Certified Production & Operations Manager (POM) Practice Exam

What is one of the main risks associated with outsourcing?

1. Increased production speed

2. Lack of control over quality

3. Reduction of workplace distractions

4. Improved employee morale

The correct answer is: Lack of control over quality

One of the main risks associated with outsourcing is the lack of control over quality. When a company outsources certain functions or manufacturing processes to external vendors or service providers, it gives up a certain level of oversight. This can lead to inconsistencies in product quality, service delivery, and adherence to the brand's standards. The external providers may not fully understand the company's specifications or may prioritize cost savings over quality, resulting in products that do not meet the company's expectations or requirements. This risk can have serious implications for customer satisfaction, brand reputation, and overall business success. In contrast, increased production speed, reduction of workplace distractions, and improved employee morale can be benefits of outsourcing rather than risks. These aspects can enhance operational efficiency and create a more focused work environment when managed correctly, making them less aligned with the concept of risks.