Heinsert Inc. is a computer manufacturing firm. Its core business process is the production ofefficient processors and storage disks. It outsources the manufacturing of its computer screen to a camera and lens manufacturing firm called Zetax, which is highly efficient and has world-class capabilities. Identify the most appropriate reason why Heinsert outsources its computer screen production.

Question

a. To increase the marketing expenses on its core operation
b. To upgrade its products’ capabilities and services
c. To increase the revenue ofits products
d. To decelerate the products’ time to market

Answer 1

b. To upgrade its products’ capabilities and services
An outsourcing service provider can perform a business process better than its clients ever could. The outsourcing provider might be highly efficient, with world-class capabilities and access to new technology, methods, and expertise that would not be cost effective for its clients to acquire and maintain. Thus, outsourcing a function can provide a considerable upgrade in capabilities and service.