APICS Exam CSCP Topic 5 Question 97 Discussion

Actual exam question for APICS's CSCP exam

Question #: 97
Topic #: 5

[All CSCP Questions]

The primary risk associated with outsourcing innovative components to suppliers is:

Adecreased flexibility.

Bhigher carrying costs.

Cemployee turnover.

Dloss of competitive knowledge.

Show Suggested Answer

Suggested Answer: D

Outsourcing innovative components can lead to several risks, but the primary risk is the loss of competitive knowledge:

Intellectual Property: When innovative components are outsourced, there is a risk that critical intellectual property and proprietary knowledge will be transferred to or accessed by suppliers.

Competitive Advantage: These components often embody the firm's core competencies and technological advantages. Losing control over these can diminish the company's competitive edge.

Dependency on Suppliers: Relying on external suppliers for innovative parts can reduce the firm's ability to rapidly adapt and innovate, leading to decreased flexibility and potential delays in response to market changes.

While decreased flexibility and higher carrying costs are concerns, they are secondary to the risk of losing competitive knowledge.

Pisano, Gary P., and Willy C. Shih. 'Restoring American Competitiveness.' Harvard Business Review.

Quinn, James Brian. 'Strategic Outsourcing: Leveraging Knowledge Capabilities.' Sloan Management Review.

by Mable at Sep 18, 2024, 02:08 PM

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Erick

28 days ago

Outsourcing innovation? That's like asking a toddler to build a rocket ship. I'll go with D and hope for the best!

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Gwenn

29 days ago

This question is just like my love life - full of risks and uncertainties! But I think D is the right answer here.

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Cheryl

1 months ago

But what about the loss of competitive knowledge? That's a big risk too.

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Elizabeth

1 months ago

I agree with Marnie, outsourcing can limit our ability to make changes quickly.

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Gary

1 months ago

Hmm, I'm torn between B and D. Higher carrying costs and loss of competitive knowledge both seem like major concerns to me.

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Lashawna

5 days ago

Yes, losing competitive knowledge can also be a huge issue when outsourcing.

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Marget

8 days ago

D) loss of competitive knowledge.

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France

9 days ago

I agree, higher carrying costs can definitely be a major risk.

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Desmond

18 days ago

A: I think D is the bigger risk. Losing competitive knowledge could really hurt us in the long run.

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Laurel

22 days ago

B) higher carrying costs.

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Jennifer

28 days ago

A) decreased flexibility.

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Marnie

1 months ago

I think the primary risk is decreased flexibility.

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Vanna

1 months ago

I'd go with A. Decreased flexibility. You lose control over the development process when you outsource, and that's a recipe for rigidity.

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Letha

11 days ago

That's a good point, we could lose our edge if we rely too much on suppliers.

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Delfina

18 days ago

D) loss of competitive knowledge.

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Berry

22 days ago

I agree, outsourcing can limit our ability to make changes quickly.

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Jeanice

25 days ago

A) decreased flexibility.

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Roosevelt

2 months ago

Definitely D. Loss of competitive knowledge - that's the biggest risk when outsourcing innovative components. Can't afford to give away the secret sauce!

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