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Re: Outsourcing is the practice of obtaining from an independent supplier [#permalink]
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 04 Apr 2016, 20:23
I really don't agree with E for the same reason stated earlier, how can you decide if the tasks performed inefficiently are the tasks which are outsourced..and even if managers are spending more time on them we dont really know if their paying attention on the core business will for sure boost profits as there are many variables. Anyway, the not to go out of scope, I will stick with the reason that we dont know if inefficient tasks are the ones outsourced.
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Re: Outsourcing is the practice of obtaining from an independent supplier [#permalink]
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09 Apr 2016, 07:12
I am still confused why the answer cant be D.
Vernon main aim is to get the work done at a lower cost.
What if the thing is outsourced but is costly to the company?
The plan will be successful only if the costs are low.
D clearly states that Vernon will have bidding based on which it can select which company can be called in for outsourcing?
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Re: Outsourcing is the practice of obtaining from an independent supplier [#permalink]
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15 Apr 2016, 23:27
eyunni wrote: Outsourcing is the practice of obtaining from an independent supplier a product or service that a company has previously provided for itself. Vernon, Inc, a small manufacturing company that has in recent years experienced a decline in its profits, plans to boost its profits by outsourcing those parts of its business that independent suppliers can provide at a lower cost than Vernon can itself.
Which of the following, if true, most strongly supports the prediction that Vernon's plan will achieve its goal?
Please explain your answers. A. Among the parts of its business that Vernon does not plan to outsource are some that require standards of accuracy too high for most independent suppliers to provide at a lower cost than Vernon can. argument is not concern about plans that Vernon does not plan to outsource. so out of scope choice it is.
B. Vernon itself acts as an independent supplier of specialized hardware items to certain manufacturers that formerly made those items themselves. so what stated in this choice could help as motivation to have this plan come in place. but we are looking for a choice that tells YES, this plan will be successful. this is why it is an Out of scope choice.
C. Relatively few manufacturers that start as independent suppliers have been able to expand their business and become direct competitors of the companies they once supplied. this choice says those independent suppliers of products or services are danger to those obtaining these services. this is a weaken-er type of choice.
D. Vernon plans to select the independent suppliers it will use on the basis of submitted bids. this choice is an evaluation not strengthen. if no bidder provide service or product in lower cost than that vernon has to bear on its own then plan is failed. vice-versa, plan is successful. this is an EVALUATE choice.
E. Attending to certain tasks that Vernon performs relatively inefficiently has taken up much of the time and effort of top managers whose time would have been better spent attending to Vernon's core business. If certain task that eat up all valuable time, time that can help business grow and in turn help reduce the cost, then it is good to outsource those task to indep suppliers. - this is strengthen-er choice.
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Re: Outsourcing is the practice of obtaining from an independent supplier [#permalink]
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23 Aug 2016, 08:58
manlog wrote: Very confusing one. There is no linkage between task that are performed inefficiently and tasks that could be done by outsource companies cheaply. Attending to certain tasks that Vernon performs relatively inefficiently has taken up much of the time and effort of top managers whose time would have been better spent attending to Vernon's core business. First of all you can bring new information because it is a strengthen question. But this new information should connect to the key elements on which the argument is based. here key elements are profit, cost, outsource.So your question about connection of inefficiency and outsourcing is valid. but here is how they are connected:If time can affect the core business than Time is that crucial factor, which impacts the profits. If you could get a grip on this dimension by outsourcing the tasks which are victim of it then vernon for sure should go ahead and outsource relevant tasks. How come the time was impacted? it was because of the inefficiency. so here is the casue and effect relation: inefficiency ---> eat up hell lot of time ----> impacts business ----> impacts profits Initial cause and final effect are supposed to be considered in relation to conclusion.inefficiency ---> impacts profits outsource --> take away the impact on profits ---> take away the inefficiency.hope it clears the doubt!
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Re: Outsourcing is the practice of obtaining from an independent supplier [#permalink]
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23 Aug 2016, 10:22
manlog wrote: Very confusing one. There is no linkage between task that are performed inefficiently and tasks that could be done by outsource companies cheaply. There are some tasks that are done inefficiently - since those are inefficiently done, top managers have to spend more time supervising those tasks. If those tasks are outsourced to cheap subcontractors, the cost will come down (and thus profits will go up) in two ways: 1. Saving in cost of parts: Save cost by getting it done by cheap subcontractors. 2. Saving management cost: the managers will not be required to spend time on those inefficient tasks. The question is about "plans to boost profit " rather than plans to reduce parts cost. Hence option E "most strongly" supports the prediction.
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Re: Outsourcing is the practice of obtaining from an independent supplier [#permalink]
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23 Aug 2016, 10:59
manlog wrote: HKD1710 wrote: manlog wrote: Very confusing one. There is no linkage between task that are performed inefficiently and tasks that could be done by outsource companies cheaply. Attending to certain tasks that Vernon performs relatively inefficiently has taken up much of the time and effort of top managers whose time would have been better spent attending to Vernon's core business. First of all you can bring new information because it is a strengthen question. But this new information should connect to the key elements on which the argument is based. here key elements are profit, cost, outsource.So your question about connection of inefficiency and outsourcing is valid. but here is how they are connected:If time can affect the core business than Time is that crucial factor, which impacts the profits. If you could get a grip on this dimension by outsourcing the tasks which are victim of it then vernon for sure should go ahead and outsource relevant tasks. How come the time was impacted? it was because of the inefficiency. so here is the casue and effect relation: inefficiency ---> eat up hell lot of time ----> impacts business ----> impacts profits Initial cause and final effect are supposed to be considered in relation to conclusion.inefficiency ---> impacts profits outsource --> take away the impact on profits ---> take away the inefficiency.hope it clears the doubt! Thanks for sharing your view. However, your explanation assumes that tasks, that are inefficient right now at Vernon, can be done at a lower cost by suppliers. Otherwise is doesn't make sense to outsource them. And there is nothing about this nor in the premises nor in the answer choice E. Without this assumption, choice E doesn't strengthen the argument and this assumption is quiet a big stretch. Well argument says -- "company plans to boost its profits by outsourcing those parts of its business that independent suppliers can provide at a lower cost" Out of the tasks that eat up a lot of time of managers, Obviously, there would be few tasks for which company may not find the suppliers who would do those tasks at lower costs. But there would be few other such tasks for which suppliers would provide the service. Hence few services that are outsourced do add to the boost in profit, this definitly aligns with the PLAN i.e. shows the success of the plan (strengthens). Now we,ourselves, cannot assume number of tasks or boost the profit amount because that is not the concern here.
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Re: Outsourcing is the practice of obtaining from an independent supplier [#permalink]
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15 Mar 2017, 19:32
eyunni wrote: Outsourcing is the practice of obtaining from an independent supplier a product or service that a company has previously provided for itself. Vernon, Inc, a small manufacturing company that has in recent years experienced a decline in its profits, plans to boost its profits by outsourcing those parts of its business that independent suppliers can provide at a lower cost than Vernon can itself.
Which of the following, if true, most strongly supports the prediction that Vernon's plan will achieve its goal?
A. Among the parts of its business that Vernon does not plan to outsource are some that require standards of accuracy too high for most independent suppliers to provide at a lower cost than Vernon can.
B. Vernon itself acts as an independent supplier of specialized hardware items to certain manufacturers that formerly made those items themselves.
C. Relatively few manufacturers that start as independent suppliers have been able to expand their business and become direct competitors of the companies they once supplied.
D. Vernon plans to select the independent suppliers it will use on the basis of submitted bids.
E. Attending to certain tasks that Vernon performs relatively inefficiently has taken up much of the time and effort of top managers whose time would have been better spent attending to Vernon's core business.
Please explain your answers. Merging topics. Please, refer to the discussion above: https://gmatclub.com/forum/outsourcing- ... 53143.html
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Re: Outsourcing is the practice of obtaining from an independent supplier [#permalink]
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21 Mar 2017, 09:34
Outsourcing is the practice of obtaining from an independent supplier a product or service that a company has previously provided for itself. Vernon, Inc, a small manufacturing company that has in recent years experienced a decline in its profits, plans to boost its profits by outsourcing those parts of its business that independent suppliers can provide at a lower cost than Vernon can itself. Which of the following, if true, most strongly supports the prediction that Vernon's plan will achieve its goal? A. Among the parts of its business that Vernon does not plan to outsource are some that require standards of accuracy too high for most independent suppliers to provide at a lower cost than Vernon can. B. Vernon itself acts as an independent supplier of specialized hardware items to certain manufacturers that formerly made those items themselves. C. Relatively few manufacturers that start as independent suppliers have been able to expand their business and become direct competitors of the companies they once supplied. D. Vernon plans to select the independent suppliers it will use on the basis of submitted bids. E. Attending to certain tasks that Vernon performs relatively inefficiently has taken up much of the time and effort of top managers whose time would have been better spent attending to Vernon's core business.
The best approach is by Process of elimination A,B,C and D are clearly out of scope since they have no corelation with the provided argument,we are only left with option E
which describes the situation of the company in an alternate explaination.
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Re: Outsourcing is the practice of obtaining from an independent supplier [#permalink]
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29 Mar 2017, 23:58
This post is so messed up . Same question strengthen , weaken type. Some other question also 
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Re: Outsourcing is the practice of obtaining from an independent supplier [#permalink]
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09 Apr 2017, 05:37
A. Among the parts of its business that Vernon does not plan to outsource are some that require standards of accuracy too high for most independent suppliers to provide at a lower cost than Vernon can.
B. Vernon itself acts as an independent supplier of specialized hardware items to certain manufacturers that formerly made those items themselves.
C. Relatively few manufacturers that start as independent suppliers have been able to expand their business and become direct competitors of the companies they once supplied.
D. Vernon plans to select the independent suppliers it will use on the basis of submitted bids.
E. Attending to certain tasks that Vernon performs relatively inefficiently has taken up much of
answer is E
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Re: Outsourcing is the practice of obtaining from an independent supplier [#permalink]
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18 Jul 2017, 13:54
sayantanc2k wrote: manlog wrote: Very confusing one. There is no linkage between task that are performed inefficiently and tasks that could be done by outsource companies cheaply. There are some tasks that are done inefficiently - since those are inefficiently done, top managers have to spend more time supervising those tasks. If those tasks are outsourced to cheap subcontractors, the cost will come down (and thus profits will go up) in two ways: 1. Saving in cost of parts: Save cost by getting it done by cheap subcontractors. 2. Saving management cost: the managers will not be required to spend time on those inefficient tasks. The question is about "plans to boost profit " rather than plans to reduce parts cost. Hence option E "most strongly" supports the prediction. I strongly feel that answer should be D here 2 questions here 1. How can we assume that the inefficiently done tasks will have independent suppliers offering to support those tasks at a lower cost ? 2. In D option ,folks have mentioned that getting to select the suppliers based on the bid doesnt mean that the bid offered will be lower than the cost that Vernon will take to execute the same. But that is the main point of the argument that outsourcing will be done for those parts of business where independent suppliers are able to offer a lower price than Vernpnn itself can and we have to prove that profits will increase if outsourcing is done. If we take D option the optimal bid can be chosen which in turn can maximize profits(an obvious assumption would be the that the bids offered are lower than the cost for Vernon to execute the same otherwise it wouldnt have outsourced) so if the cost for a task for vernon was 50 we have 3 bidders with proposals pf 15$,20$,30$ we would choose 15$ and maximize the profit. Can you explain ?
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Re: Outsourcing is the practice of obtaining from an independent supplier [#permalink]
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13 Aug 2017, 03:42
Can anyone please help how can we say in choice E that those task (which are mentioned in choice E) are certainly related to the task that Vernon planned to outsource?
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Re: Outsourcing is the practice of obtaining from an independent supplier [#permalink]
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15 Aug 2017, 11:40
eyunni wrote: Outsourcing is the practice of obtaining from an independent supplier a product or service that a company has previously provided for itself. Vernon, Inc, a small manufacturing company that has in recent years experienced a decline in its profits, plans to boost its profits by outsourcing those parts of its business that independent suppliers can provide at a lower cost than Vernon can itself. Vernon Inc has experienced a decline in profits, and plans to boost its profits by outsourcing business that independent suppliers can provide at a lower cost.Which of the following, if true, most strongly supports the prediction that Vernon's plan will achieve its goal? Quote: (A) Among the parts of its business that Vernon does not plan to outsource are some that require standards of accuracy too high for most independent suppliers to provide at a lower cost than Vernon can.
How would this help in increasing profits for the company? This doesn't really help answer the question. OUT! Quote: (B) Vernon itself acts as an independent supplier of specialized hardware items to certain manufacturers that formerly made those items themselves.
This is irrelevant. OUT! Quote: (C) Relatively few manufacturers that start as independent suppliers have been able to expand their business and become direct competitors of the companies they once supplied.
This is Out of Scope! OUT! Quote: (D) Vernon plans to select the independent suppliers it will use on the basis of submitted bids.
The plan is to outsource businesses that are not core to the company, and focus on the core to increase profitability. This doesn't help answer if the plan would succeed. OUT! Quote: (E) Attending to certain tasks that Vernon performs relatively inefficiently has taken up much of the time and effort of top managers whose time would have been better spent attending to Vernon's core business. This says that Vernon was performing non-core tasks inefficiently taking up too much time and effort => outsourcing these to independent suppliers would free up managers time to focus on the core business and that should help increase profitability in theory. E is the answer.
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Outsourcing is the practice of obtaining from an independent supplier [#permalink]
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Dostner, Inc., a small manufacturing company that has in recent years experienced a decline in its profits, plans to boost its profits by outsourcing those parts of its business that independent suppliers can provide at lower cost than Dostner can itself. Which of the following, if true, most strongly supports the prediction that Dostner's plan will achieve its goal? A. Among the parts of its business that Dostner does not plan to outsource are some that require standards of accuracy too high for most independent suppliers to provide at lower cost than Dostner can. B. Dostner itself acts as an independent supplier of specialized hardware items to certain manufacturers that formerly made those items themselves. C. Relatively few manufacturers that start as independent suppliers have been able to expand their business and become direct competitors of the companies they once supplied. D. Dostner plans to select the independent suppliers it will use on the basis of submitted bids. E. Attending to certain tasks that Dostner performs relatively inefficiently has taken up much of the time and effort of top managers whose time would have been better spent attending to Dostner's core business.
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Originally posted by rohan2345 on 16 Nov 2017, 09:20.
Last edited by Vyshak on 16 Nov 2017, 21:15, edited 1 time in total.
Topic Merged. Question lacks originality.
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Re: Outsourcing is the practice of obtaining from an independent supplier [#permalink]
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30 Nov 2017, 20:32
First of all..not sure why a couple of people are talking about dinosaurs on the first page. I guess when you outsource a self-sufficient Jurassic Park, the profits just come sliding in. Secondly, again why are people arguing over this....this simple isn't an amazing question, even if it's from GMAC. A, B, and C is out of scope because they don't discuss how OUTSOURCING benefits Vernon. They discuss other benefits or other general information in the industry related to outsourcing - things we don't really care about. Let's take a closer look at D and E: (D) Vernon plans to select the independent suppliers it will use on the basis of submitted bids. => Assumption Required: Cost of lowest bid < Current Cost of Outsourced Department/Component.(E) Attending to certain tasks that Vernon performs relatively inefficiently has taken up much of the time and effort of top managers whose time would have been better spent attending to Vernon's core business. => Assumption Required: More time spent by top managers on core business => Increase Profits (either through efficiency, decrease cost, standardization, optimization, insert ridiculous corporate jargon here....)If either of the above is true, we get sweet sweet profits and thus strengthens the conclusion. Which is more common-sense? Which makes more relative sense? I don't know.....to me they are the same. People might argue that (D) is weaker. Maybe, but the assumption that more time spend by top management = increase efficiency/profits is definitely starting to erode..especially in the US with the gap of shared interest widening, C-level compensation increasing.....The association is simply too far to be logically made, hence this isn't a great question.
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Re: Outsourcing is the practice of obtaining from an independent supplier [#permalink]
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10 Dec 2017, 09:35
Hi, egmat can you please explain the difference between D and E?
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Re: Outsourcing is the practice of obtaining from an independent supplier
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