Case Number: 5-404-767, Year Published: 2006
HBS Number: KEL256
Outsourcing, Supply Chain Management, Pricing Models, Return on Investment (ROI)
The case is based upon a real supply chain outsourcing management decision at a major manufacturing company. The company has been disguised for confidentiality reasons. The case discusses different types of outsourcing, supply chain management, the benefits and risks of outsourcing, and various pricing models for outsourcing contracts. Students must make a management decision and answer the following questions:
Students learn the different types of outsourcing, supply chain management, the benefits and risks of outsourcing, and various pricing models for outsourcing contracts. Students also learn how to calculate the return on investment of supply chain outsourcing. Most important, the case enables students to understand the strategic context of outsourcing, and which outsourcing model and pricing is appropriate.
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