The two big drivers of outsourcing are:
A. an increased ability to cut R&D expenses and an increased ability to avoid the problems of strategic alliances.
B. that outsiders can often perform certain activities better or more cheaply, and outsourcing allows a firm to focus its entire energies on those activities that are at the center of its expertise (its core competencies).
C. a desire to reduce the company's investment in fixed assets and the need to narrow the scope of the company's in-house competencies and competitive capabilities.
D. the ability to avoid capital investments that accompany vertical integration and a desire to reduce the company's risk exposure to changing technology and/or changing buyer preferences.
E. that a smaller in-house workforce and a low investment in intellectual capital will produce cost savings.
Answer: that outsiders can often perform certain activities better or more cheaply, and outsourcing allows a firm to focus its entire energies on those activities that are at the center of its expertise (its core competencies).