Teal Motors Inc., an automobile company, outsources the manufacturing of most of the automobile parts to several other companies that specialize in making parts such as ignition boxes, coil wires, and grills. Teal Motors makes sure to get these parts manufactured at a much lesser rate than it would if it manufactures its own parts. In this scenario, Teal Motors Inc. is effectively avoiding a _________.
A)loss of identity
B)loss of frequency
C)loss of facility
D)loss of focus

Question

Quizplus · Accepted Answer

Teal Motors Inc. is effectively avoiding a loss of focus by outsourcing the manufacturing of most of the automobile parts to several other companies that specialize in making parts. This enables the company to focus on its core competencies such as design, marketing, and distribution, and avoid the distraction of trying to manufacture parts that it may not have expertise in.