Audio Component Outsourcing (Scenario)
Echo Corp., a company based in Boston, manufactures high-quality audio components, such as speakers, amplifiers, and receivers for home entertainment systems. Echo has been losing market share in recent years due to the competitive pricing of other audio component manufacturers that engage in global sourcing. Echo managers are attempting to convince Nathan Douglas, the firm's founder and CEO, that global sourcing would enable the firm to be more competitive without sacrificing quality.
-Global sourcing becomes a catalyst to overhaul organizational processes and company operations and increases the firm's overall competitive advantages by ________.
A) encouraging firms to train unskilled labor through extensive training programs
B) allowing firms to free expensive analysts, engineers, and managers from routine tasks to spend more time on high-value-adding activities
C) relaxing quality standards
D) installing a system of rewards to motivate employees

Question

Quizplus · Accepted Answer

Global sourcing allows firms to allocate resources more efficiently by outsourcing routine tasks, enabling expensive analysts, engineers, and managers to focus on activities that add more value to the company. This strategic shift can enhance a firm's competitive advantages by improving innovation, efficiency, and overall productivity.