Whereas 'strategic alliances' focus on collaboration and exchange between partners to achieve some benefits, 'outsourcing' usually focuses more explicitly on the uni-dimension of a firm reducing its _________.

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BlackTom AI · Accepted Answer

The prompt presents a comparison between two coordination strategies and asks to identify the uni-dimensional focus of outsourcing.
First, restating the key idea: Strategic alliances emphasize collaboration and exchange between partners to achieve shared benefits, whereas outsourcing typically focuses on a specific, measurable outcome for the firm, often related to cost reduction.
Because there are no answer options provided, we consider the conventional understanding of outsourcing: it is a governance choice where a firm transfers certain activities or processes to an external provider with the aim of achieving lower costs, access to scale, or improved efficiency. In this framing, the primary, widely cited objective of outsourcing is cost reduction, not necessarily other dimensions like speed, quality, or strategic control, though those can be implications.
Option: If we examine the statement as a fill-in-the-blank about outsourcing’s uni-dimensional focus, the most fitting completion is that outsourcing concentrates on reducing costs. This is due to the emphasis on cost-efficiency through external specialization, price arbitrage, and economies of scale that third-party providers often offer.
Contrast with strategic alliances: while alliances can pursue multiple goals such as knowledge exchange, risk sharing, co-development, or market access, outsourcing narrows the emphasis toward cost and efficiency gains, making it more uni-dimensional in the typical framework.
Potential misconceptions to watch for: - Thinking outsourcing only touches costs and ignores strategic benefits like outsourcing can enable access to specialized capabilities, speed to market, or strategic flexibility; those are real benefits but they extend beyond a purely uni-dimensional cost focus.
- Assuming strategic alliances always fail to produce cost savings; alliances can yield cost synergies but also broader strategic benefits, whereas outsourcing is usually evaluated primarily on cost-related metrics.
If a student were given options, they would likely include alternatives such as reducing costs, gaining market power, increasing control, or improving product differentiation. Among these, the statement that outsourcing reduces costs aligns best with the classic, defined objective of outsourcing in the literature.
In summary, given the standard interpretation, outsourcing is typically driven by the goal of cost reduction, distinguishing it from strategic alliances that pursue a broader set of collaborative benefits.

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Whereas 'strategic alliances' focus on collaboration and exchange between partners to achieve some benefits, 'outsourcing' usually focuses more explicitly on the uni-dimension of a firm reducing its _________.

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INNO6225.17781.202610 Quiz 6- Requires Respondus LockDown Browser

Whereas 'strategic alliances' focus on collaboration and exchange between partners to achieve some benefits, 'outsourcing' usually focuses more explicitly on the uni-dimension of a firm reducing its _________.

View Explanation

Log in for full answers

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Part 1What is transferring a firm's activities that have traditionally been internal to external suppliers?Part 2 A. keiretsu network B. make-or-buy C. outsourcing D. vertical integration