Hydrus Corp. contracted most of its business processes to various other companies. This helped the company generate immediate profits, but Hydrus was losing competitive advantage over its rivals in the long run due to its lack of innovation. Which of the following is a danger of outsourcing that Hydrus Corp. experienced?
A)Lack of control
B)Loss of capabilities
C)Lack of focus
D)Loss of technology

Question

Quizplus · Accepted Answer

By outsourcing most of its business processes, Hydrus Corp. lost capabilities and expertise in those areas, which caused it to fall behind its competitors in terms of innovation and long-term competitiveness.