There are many drivers influencing the offshoring decision. Selecting a dominant driver is the key to a success of an offshoring venture. Supposed your Boston company is planning to develop, manufacture and market a line of luxurious clocks. Several offshoring options are being evaluated. Here is the list of offshoring and internal candidates along with their corresponding engineering hourly burden rates: Shanghai ($20) St. Petersburg ($45) Dallas ($85) Honolulu ($120) Berlin ($200) Zurich ($300) After the first round of various considerations and responding to RFPs (Request for Proposals), China, Russia, Texas and Hawaii dropped out. An extensive second round resulted in Swiss winning the contract. Of the following four key drivers, which one is the most probable dominant factor at the top of the list of the decision making? to get a shot at even a small chance on a global market, you must hire the best possible people, the strongest talent... and forget about any other consideration you ever had language barrier is the biggest hindrance to a successful business cheap labor drives the bottom line of a modern enterprise you must collocate your people to simplify their communication

Purchasing and Supply Chain Management

6th Edition

ISBN:9781285869681

Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Publisher:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

ChapterC: Cases

Section: Chapter Questions

Problem 6.3A

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There are many drivers influencing the offshoring decision. Selecting a dominant driver is the key to a success of an offshoring venture. Supposed your Boston company is planning to develop, manufacture and market a line of luxurious clocks. Several offshoring options are being evaluated. Here is the list of offshoring and internal candidates along with their corresponding engineering hourly burden rates:

Shanghai ($20)
St. Petersburg ($45)
Dallas ($85)
Honolulu ($120)
Berlin ($200)
Zurich ($300)

After the first round of various considerations and responding to RFPs (Request for Proposals), China, Russia, Texas and Hawaii dropped out. An extensive second round resulted in Swiss winning the contract. Of the following four key drivers, which one is the most probable dominant factor at the top of the list of the decision making?

		to get a shot at even a small chance on a global market, you must hire the best possible people, the strongest talent... and forget about any other consideration you ever had
		language barrier is the biggest hindrance to a successful business
		cheap labor drives the bottom line of a modern enterprise
		you must collocate your people to simplify their communication

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