Outsourcing 1
A vocabulary exercise covering the language of outsourcing and third-party business relationships. These terms are used in vendor management, service agreements, and the broader discussion of make-vs-buy decisions.
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Choose the correct response to complete each sentence.
1. The decision to outsource is often made ____________________ lowering costs.
Correct answer: in the interest of.
2. The process of __________________________ is similar to outsourcing, but it refers to finding the cheapest products, not services.
Correct answer: global sourcing.
3. "Offshore outsourcing" refers to outsourcing __________________________.
Correct answer: to another country.
4. One potential benefit of offshore outsourcing is lower ____________________ in some markets.
Correct answer: labor costs.
5. A country with a lower average income and a less industrialized economy may be described as ____________________.
Correct answer: developing.
6. Bringing work back inside a company is known as ____________________.
Correct answer: insourcing.
7. Companies must consider labor standards and ____________________ when selecting an outsourcing location.
Correct answer: workers' rights.
8. Proponents of outsourcing claim that it allows companies to develop competitive strategies that will help them compete in the __________________________ marketplace.
Correct answer: global.
9. ____________________ of outsourcing may question its effects on service quality.
Correct answer: Opponents.
10. One common ____________________ of outsourcing is that local jobs may be moved abroad.
Correct answer: criticism.
📚 Important Words to Know
request for proposal (RFP) — a document inviting suppliers to submit bids for a specific product or service
purchase order (PO) — a commercial document authorizing a supplier to deliver specific goods or services at an agreed price
vendor management — the process of overseeing and controlling relationships with external suppliers and service providers
supply chain risk — the potential for disruptions or failures at any point in the supply chain that could affect operations
strategic sourcing — a systematic approach to procurement that optimizes costs and aligns supplier relationships with business goals
sole sourcing — purchasing from a single supplier when only one vendor can provide a particular product or service
competitive bidding — a procurement process where multiple suppliers submit offers and the best one is selected
vendor due diligence — the process of evaluating a supplier's financial stability, compliance, and capability before engagement
SLA (Service Level Agreement) — a contract defining the expected level of service between a supplier and a client
total cost of ownership (TCO) — the full cost of acquiring, operating, and maintaining a product or service over its lifetime
request for proposal (RFP) — a document inviting suppliers to submit bids for a specific product or service
purchase order (PO) — a commercial document authorizing a supplier to deliver specific goods or services at an agreed price
vendor management — the process of overseeing and controlling relationships with external suppliers and service providers
supply chain risk — the potential for disruptions or failures at any point in the supply chain that could affect operations
strategic sourcing — a systematic approach to procurement that optimizes costs and aligns supplier relationships with business goals
sole sourcing — purchasing from a single supplier when only one vendor can provide a particular product or service
competitive bidding — a procurement process where multiple suppliers submit offers and the best one is selected
vendor due diligence — the process of evaluating a supplier's financial stability, compliance, and capability before engagement
SLA (Service Level Agreement) — a contract defining the expected level of service between a supplier and a client
total cost of ownership (TCO) — the full cost of acquiring, operating, and maintaining a product or service over its lifetime
▶ Keep practicing — more exercises for you:
Starting a business 1
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Starting a business 3
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Project management 2
Project management 3
Business negotiations 1
Business negotiations 2
Starting a business 2
Starting a business 3
Project management 1
Project management 2
Project management 3
Business negotiations 1
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