ISST7322 31/10/2025

The make-or-buy decision in sourcing refers to:

• Build systems internally or purchase them externally

• Lease or buy hardware equipment

• Hire or train staff internally

• Develop open-source software

Which of the following is a primary advantage of insourcing?

• Lower labor costs

• Greater control over data security and confidentiality

• Guaranteed service quality

• Reduced management oversight

A major risk of insourcing is that:

• It reduces innovation

• It diverts resources from other value-added activities

• It limits access to expertise

• It causes data breaches

Outsourcing primarily involves:

• Buying off-the-shelf software only

• Acquiring internal resources for new projects

• Purchasing goods or services from external providers

• Building systems internally

One of the key benefits of outsourcing is:

• Increased management attention

• Economies of scale

• Higher in-house innovation

• Reduced security risks

Which of the following is not a common risk of outsourcing?

• Loss of control

• Dependency on providers

• Guaranteed cost savings

• Difficulty terminating contracts

Crowdsourcing differs from traditional outsourcing because it:

• Involves only professional firms

• Uses a large group of individuals

• Is performed exclusively in-house

• Focuses on physical products

Onshoring refers to:

• Moving operations to a nearby foreign country

• Performing outsourced work domestically

• Hiring foreign contractors

• Relocating data centers offshore

Offshoring typically involves:

• Contracting with providers in the same country

• Using a hybrid in-house/offshore model

• Relocating business processes to another country

• Hiring only local employees

A major reason companies consider outsourcing is:

• To increase operational control

• To reduce costs and focus on core activities

• To limit flexibility

• To centralize all functions