Management Information System (MIS) Practice Exam

What term refers to the delegation of logistics operations to a subcontractor?

1. Outsourcing

2. In-forming

3. Offshoring

4. In-sourcing

The correct answer is: Outsourcing

The term that refers to the delegation of logistics operations to a subcontractor is outsourcing. Outsourcing involves transferring responsibility for specific operational processes or services, such as logistics, to external companies or third parties. This practice allows businesses to focus on their core competencies while leveraging the specialized skills and resources of the subcontractors for improved efficiency and cost-effectiveness. In contrast, in-forming refers to the process where businesses gather data and insights, often through technology, to inform decision-making but does not involve delegating operations. Offshoring involves relocating business processes or services to a different country to take advantage of lower labor costs but is not limited to subcontracting logistics. In-sourcing is the opposite of outsourcing; it entails bringing operations in-house rather than delegating them to external entities. Understanding these distinctions highlights why outsourcing is the correct term for delegating logistics operations to a subcontractor.