Which of the following minimizes the risks of outsourcing?
A) the use of short-term contracts that specify price
B) shifting the firm's responsibility for on-time delivery to the supplier
C) building close partnerships with the supplier
D) increasing the contract price

Question

Quizplus · Accepted Answer

Building close partnerships with the supplier helps to establish trust and open communication, which can help minimize risks such as poor quality, delays, and loss of proprietary information. This collaboration also allows for joint problem-solving and process improvements, leading to better outcomes for both parties. Short-term contracts that specify price may lead to lower costs in the short-term, but may not foster the long-term relationship needed for successful outsourcing. Shifting responsibility for on-time delivery to the supplier may not be feasible in all cases and may result in disputes and lack of accountability. Increasing the contract price is not necessarily a guarantee of better quality or performance, and may not be financially feasible for the firm.

Which of the Following Minimizes the Risks of Outsourcing