MODULE 5 Flashcards
TITLE OF MODULE 5?
OUTSOURCING, RISK MANAGEMENT, AND PURCHASING STRATEGIES
True or False: Companies have been grappling with how to exploit their competitive advantage since the Industrial Revolution.
TRUE
True or False: The model for most of the 20th century was a small integrated company that could “own, manage, and directly control” its assets.
FALSE
True or False: The rallying cry in the 1950s and 1960s was for companies to specialize in their core business.
FALSE
True or False: By diversifying, companies expected to protect profits, even though expansion required multiple layers of management.
TRUE
True or False: Bloated management structures were not a handicap for organizations trying to compete globally in the 1970s and 1980s.
FALSE
True or False: Many large companies developed a new strategy of focusing on their core business in order to increase their flexibility and creativity.
TRUE
True or False: Identifying critical processes and deciding which could be outsourced was not a part of the strategy of focusing on core business.
TRUE
True or false: Outsourcing was recognized as a business strategy before 1989.
FALSE
True or false: Most organizations can be self-sufficient and do not need to outsource any functions.
FALSE
True or false: Publishers often purchase composition, printing, and fulfillment services from external suppliers.
TRUE
True or false: Outsourcing support services was the first stage in the evolution of outsourcing.
FALSE
True or false: Outsourcing support services was the first stage in the evolution of outsourcing.
FALSE
True or false: In the 1990s, organizations started outsourcing functions necessary to run a company but not related to the core business.
TRUE
True or false: Managers contracted with service companies to deliver accounting, human resources, and plant maintenance as a matter of “good housekeeping”.
TRUE
True or false: Outsourcing key functions does not affect cost savings.
FALSE
True or false: Managers do not seek to improve their finances by outsourcing components.
FALSE
True or false: The current stage of outsourcing is the outsourcing of core competencies.
FALSE
True or false: Outsourcing core functions is considered anathema in modern business.
FALSE
True or false: A core competency is defined as any function that gets close to customers.
TRUE
True or false: Outsourcing some core functions may be a good strategy in some cases.
TRUE
True or false: Some organizations outsource customer service because it is not important.
FALSE
True or false: Eastman Kodak’s decision to outsource its IT systems was not revolutionary.
FALSE
True or false: Eastman Kodak was the only major corporation to outsource its IT systems.
FALSE
True or false: The focus in outsourcing today is more on ownership than on developing strategic partnerships.
FALSE
True or false: Organizations are likely to select outsourcing based on who can deliver more effective results for a specific function rather than on whether the function is core or commodity.
TRUE
True or false: Outsourcing is the use of internal resources to perform activities traditionally handled by outside staff.
FALSE
True or false: Outsourcing involves the contracting out of major functions to specialized and efficient service providers.
TRUE
True or false: Companies have not always hired contractors for particular types of work.
FALSE
True or false: The difference between outsourcing and subcontracting is insignificant.
FALSE
True or false: The most common reasons to outsource in earlier periods were strategic drivers.
FALSE
True or false: Outsourcing can help companies reduce and control operating costs.
TRUE
True or false: Outsourcing is only used when there are insufficient resources available internally.
FALSE
True or false: The main reason companies outsource is to free internal resources for other purposes.
FALSE
True or false: Understanding company goals and objectives is not a critical factor for a successful outsourcing program.
FALSE
True or false: Selecting any vendor is fine for a successful outsourcing program.
FALSE
True or false: Open communication with affected individual/groups is not necessary for a successful outsourcing program.
FALSE
True or false: Senior executive support and involvement is not important for a successful outsourcing program.
FALSE
True or false: There are only three main aspects to a typical outsourcing program.
FALSE
True or false: Program closure is not one of the main aspects of a typical outsourcing
FALSE
True or false: Final Agreement is one of the main aspects of a typical outsourcing program.
TRUE
True or false: The Program Initiation Stage is concerned with implementing the outsourcing program.
FALSE
True or false: The purpose and scope of the outsourcing program are established during the Program Initiation Stage.
TRUE
True or false: The ideas and intentions about the outsourcing program are not documented during the Program Initiation Stage.
FALSE
True or false: The Program Initiation Stage is the final stage of the outsourcing program.
FALSE
True or false: The Program Initiation Stage involves drafting a contract based on the ideas and intentions of the outsourcing program.
TRUE
True or false: Service Implementation is concerned with developing ideas and intentions into a formal outsourcing program.
TRUE
True or false: Transferring staff is not one of the activities covered under Service Implementation.
FALSE
True or false: Service Implementation does not involve defining the Service Level Agreement (SLA).
FALSE
True or false: Service Implementation is not concerned with maintaining continuity of service during the hand-over phase.
FALSE
True or false: Quality of delivery and deadlines are not important during the hand-over phase of Service Implementation.
FALSE
True or false: The final Contract is produced during the Program Initiation stage.
FALSE
True or false: The draft contract is not amended during negotiations.
FALSE
True or false: The Final Agreement is produced on completion of the negotiation cycle.
TRUE
True or false: The negotiation cycle is not an important part of Final Agreement.
FALSE
True or false: Final Agreement does not involve any amendment to the draft contract.
FALSE
True or false: Program Closure involves continuing to argue lost causes.
FALSE
True or false: Formal filing of information is not required during Program Closure.
FALSE
True or false: It is not necessary for staff and companies to accept the new situation and move forward during Program Closure.
FALSE
True or false: Program Closure does not involve storing information for future reference.
FALSE
True or false: There is no need for a formal close down of the program in order to gain maximum benefit.
FALSE
True or false: There are simple criteria to conduct an outsourcing versus in-house analysis.
FALSE
True or false: Cost is the only consideration when deciding whether to outsource.
FALSE
True or false: Outsourcing allows organizations to be more efficient, flexible, and effective.
TRUE
True or false: Outsourcing does not help in reducing costs.
FALSE
True or false: One of the advantages of outsourcing is the ability to tap into best practices.
TRUE
True or false: Outsourcing does not involve knowledge transfer to permanent staff.
FALSE
True or false: Outsourcing does not provide access to the flexibility and creativity of experienced problem solvers.
FALSE
True or false: Outsourcing diverts focus from core competencies.
FALSE
True or false: Business Process Outsourcing (BPO) involves the engagement of services from a first-party provider.
FALSE
True or false: BPO can involve back-office activities such as payroll, accounting, and human resources.
TRUE
True or false: BPO cannot involve front-office jobs such as customer service, sales, and marketing.
FALSE
True or false: BPO can involve hiring remote writers, editors, or virtual assistants.
TRUE
True or false: BPO slows down processes and decreases efficiency.
FALSE
True or false: BPO allows companies to focus on their core services and competencies.
TRUE
True or false: BPO does not help in improving customer satisfaction.
FALSE
True or false: Companies find it impractical to hire a full-time position in-house because of the cost associated with doing so.
TRUE
True or false: Business process outsourcing does not result in cost savings.
FALSE
True or false: Outsourcing provides access to a bigger employment pool of talent.
TRUE
True or false: Having a global presence through outsourcing increases trade opportunities.
TRUE
True or false: Outsourcing does not reduce internal local labor and employment compliance obligations.
FALSE
True or false: Outsourcing allows companies to leverage the skills of other specialist companies.
TRUE
True or false: Outsourcing hinders the client company’s ability to focus on their core functions.
FALSE
True or false: A realtor hiring a virtual assistant for appointment scheduling and customer inquiries is an example of business process outsourcing.
TRUE
True or false: Telecommunication companies outsourcing customer service teams for technical and billing support is an example of business process outsourcing.
TRUE
True or false: Small businesses outsourcing lead generation to gather more customers locally and overseas is not an example of business process outsourcing.
FALSE
True or false: Hiring professionals locally for complex tasks can be expensive due to scarce demand.
TRUE
True or false: Entrepreneurs and small teams may need additional training or a professional license to accomplish complex tasks.
TRUE
True or false: Professional outsourcing is not a solution for tasks that require specialized skills or licenses.
FALSE
True or false: Accountants and bookkeepers are hired only to comply with annual tax filing and income statements.
FALSE
True or false: CAD operators and engineers cannot do building layout, including floor plans and mechanical designs.
FALSE
True or false: Outsourcing marketing to professionals can lead to better management of promotions and marketing strategies.
TRUE
True or false: Offshoring IT services is not a common type of outsourcing.
FALSE
True or false: IT outsourcing involves contracting technology-related services and resources for a part or the entirety of an information technology business function.
TRUE
True or false: Every business, regardless of its size, has no IT needs.
FALSE
True or false: Alibaba outsourced software developers locally at first.
FALSE
True or false: Slack’s platform interface is outsourced to a software development company in the United States.
FALSE
True or false: Telecommunication companies have been outsourcing IT infrastructure to India and the Philippines to improve their capacity and better their services.
TRUE
True or false: Multi-sourcing is commonly applied only in sectors of high specialism and/or complexity.
TRUE
True or false: Multi-sourcing involves combining outsourcing output from dedicated specialized companies to create a finished product.
TRUE
True or false: Multi-sourcing does not require a comprehensive strategy and a network of governance and relationships.
FALSE
True or false: Multi-sourcing forms teams that are not focused on achieving business goals.
FALSE
True or false: Making your own products in-house is a cost-effective option.
FALSE
True or false: The cost of raw materials and factory workers can be high if you make your own products in-house.
TRUE
True or false: Outsourcing the manufacturing process can help you reduce costs.
TRUE
True or false: You still need to pay for infrastructure and equipment if you outsource the manufacturing process.
FALSE
True or false: Labor costs are not a concern if you outsource the manufacturing process.
FALSE
True or false: Apple designs and manufactures its products in China.
FALSE
True or false: H&M and Zara produce their clothing products in their own factories.
FALSE
True or false: Ikea outsources the manufacturing of their furniture to China to reduce costs.
TRUE
True or false: Outsourcing allows tasks to be completed faster and with better quality output due to specialized expertise and equipment.
TRUE
True or false: Outsourcing supporting processes can help organizations focus more on strengthening their core business process.
TRUE
True or false: Outsourcing can mitigate risks by allowing the organization to shift certain responsibilities to the outsourced vendor who is a specialist in risk-analysis.
TRUE
True or false: Outsourcing can increase recruitment and operational costs.
FALSE
True or false: Outsourcing HR, Payroll and Recruitment services can expose confidential company information to a third-party.
TRUE
True or false: Choosing the wrong outsourcing partner can result in stretched delivery time frames, sub-standard quality output, and inappropriate categorization of responsibilities.
TRUE
True or false: Hidden costs can be a serious threat when signing a contract for outsourcing across international boundaries.
TRUE
True or false: An outsourced vendor may lack complete focus on an organization’s tasks due to catering to the needs of multiple organizations at a time.
TRUE
True or false: The Oxford English Dictionary definition of risk only includes negative consequences.
FALSE
True or false: The Institute of Risk Management defines risk as the combination of probability and consequence.
TRUE
True or false: ISO Guide 73 is a guide to risk management definitions.
TRUE
True or false: The IIA defines risk as the certainty of an event occurring.
FALSE
True or false: Health and safety professionals define risk as a combination of likelihood and magnitude.
TRUE
True or false: Corporate objectives are always fully stated by most organizations.
FALSE
True or false: Personal objectives set for staff in an organization tend to refer to routine operations.
FALSE
True or false: Risk can be related to opportunity, hazard, or uncertainty.
TRUE
True or false: Hidden costs are not a disadvantage of outsourcing.
FALSE
True or false: Outsourcing always results in reduced operational and recruitment costs.
FALSE
True or false: Risks are always associated with negative outcomes.
FALSE
True or false: Risks can only result in uncertainty and never in positive outcomes.
FALSE
True or false: Hazard risks are also known as speculative risks.
FALSE
True or false: Control risks are also known as uncertainty risks.
TRUE
True or false: Opportunity risks are also known as pure risks.
FALSE
True or false: Every risk requires the same management or analysis approach.
FALSE
True or false: Taking a proactive approach to risk and risk management will only lead to improvement in operations.
FALSE
True or false: The events in the world financial system during 2008 had no impact on organizations’ interest in risk and risk management.
FALSE
True or false: By considering risks involved in alternatives and delivering process changes effectively, processes will become less effective.
FALSE
True or false: The risks associated with different strategic options can be fully analyzed to make better strategic decisions.
TRUE
True or false: Stakeholders expect organizations to take full account of risks that may cause disruption within operations, but not failure to deliver strategy.
FALSE
True or false: The likelihood and impact of a risk can be used to define the exposure presented by that risk.
TRUE
True or false: As risk exposure increases, likely impact will decrease.
FALSE
True or false: It is no longer acceptable for organizations to find themselves in a position where unexpected events cause financial loss and damage to reputation.
TRUE
True or false: Risk management can only help reduce the damage caused by events that can cause disruption to normal efficient production operations.
FALSE
True or false: The term “efficacious” refers to the fact that the strategy developed will be fully capable of delivering the required outcomes.
TRUE
True or false: Hazard risks can have positive outcomes.
FALSE
True or false: Hazard risk management is not related to the management of insurable risks.
FALSE
True or false: Hazard risks can only cause disruption to normal operations.
FALSE
True or false: Hazard risks are not related to business dependencies such as IT and other supporting services.
FALSE
True or false: Theft and fraud are not significant hazard risks for many organizations.
FALSE
True or false: Different organizations have the same attitudes to risk.
FALSE
True or false: The attitude of an organization to risk is dependent on the sector and the nature of the marketplace.
TRUE
True or false: An organization may be considered to be risk aggressive because it has decided to pursue a high-risk opportunity.
TRUE
True or false: One of the major contributions from successful risk management is to ensure that strategic decisions are taken with all of the available information.
TRUE
True or false: Improvement in decision-making processes is not one of the key benefits of risk management.
FALSE
True or false: Hazard risks are the risks that can only enhance the achievement of the corporate mission.
FALSE
True or false: Control risks are associated with uncertainty, and examples include the potential for legal non-compliance and losses caused by fraud.
TRUE
True or false: Opportunity risks are the risks that are usually avoided by the organization.
FALSE
True or false: Control risks are the easiest type of risk to describe.
FALSE
True or false: Control risks are the easiest type of risk to describe.
FALSE
True or false: Organizations with a large appetite for opportunity investment may have a small hazard tolerance.
TRUE
True or false: Organizations should be tolerant of health and safety risks.
FALSE
True or false: Organizations should take all appropriate actions to eliminate health and safety risks.
TRUE
True or false: Organizations manage safety risks to the highest possible level.
FALSE
True or false: Hazard risks do not result in unplanned disruption for the organization.
FALS
True or false: Disruptive events should always be avoided, regardless of the circumstances.
FALSE
True or false: The desired state in hazard risk management is to have no unplanned disruption or inefficiency.
TRUE
