Outsourcing Risks Include Breaches in Intellectual Property, Provider Shirking, and Opportunistic

question 47

Multiple Choice

Outsourcing risks include breaches in intellectual property, provider shirking, and opportunistic renegotiation. The combination of contractual incompleteness, asset specificity, and uncertainty gives rise to these risks when firms pursue external sourcing. Outsourcing organizations must have a clear _____________________.

• A) legally binding contract
• B) understanding of the contract
• C) understanding of true supplier intentions
• D) definition of supplier roles and responsibilities
• E) understanding of the supplier's role and responsibilities

Understand the goals and structure of effective adjustment messages.

Realize the significance of expressing authenticity and sincerity in goodwill, condolences, and thank you messages.

Recognize the potential of complaint messages as opportunities for improvement.

Understand the formatting and stylistic preferences for business communications to enhance professionalism and clarity.

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Definitions:

Acid-Test Ratio

A financial metric used to determine a company's short-term liquidity position, calculated by dividing current assets excluding inventory by current liabilities.

Working Capital

The difference between a company's current assets and current liabilities, indicating the short-term financial health and operational efficiency.

Marketable Securities

Financial instruments and assets that are easily convertible into cash, typically with high liquidity and short maturities.

Current Ratio

A financial metric indicating the capacity of a business to meet its obligations due within the next year, determined by dividing its current assets by its current liabilities.