Q25-23RQ - Horngren'S Financial And Managerial Accounting

Question

What questions should managers answer when considering outsourcing?

Step-by-Step Solution

Answer

Answer

When considering outsourcing, the manager must consider some important questions such as cost-saving, quality, the deadline to deliver the product, impact on sales revenue, and many more. 

Step-by-Step Solution Step 1: Meaning of Management

The term management refers to the authority of a business entity responsible for managing and controlling the activities and operations of the business and its human assets. Lower, middle and upper levels are some levels of management of an organization. 

Step 2: Important questions when considering outsourcing

A manager must answer the following questions when considering the outsourcing:

• A manager must review the outsourcing will save the company’s costs or not.
• The impact of outsourcing on the sales revenue must be taken into mind when considering outsourcing.
• Whether the client will be able to deliver the services or products to meet the deadlines.
• Whether the vendor is trustworthy or may harm business information should be reviewed. 
• Also, the managers must check the resources and technology of the service provider to ensure quality.