An MNE can build strategic flexibility and reduce economic exposure by contracting out manufacturing.

Question

Quizplus · Accepted Answer

By contracting out manufacturing, an MNE can reduce its level of economic exposure as it is not entirely dependent on its own manufacturing facilities. This allows the MNE to be more flexible in responding to changes in the market and reduces its risk in case of economic downturns or disruptions in production. Additionally, contracting out manufacturing can free up capital, resources, and personnel to focus on other areas of the business, providing the MNE with greater strategic flexibility.

An MNE Can Build Strategic Flexibility and Reduce Economic Exposure