The two big drivers of outsourcing are Select one: A. that a smaller in-house workforce and a low investment in intellectual capital will produce cost savings. B. a desire to reduce the company's investment in fixed assets and the need to narrow the scope of the company's in-house competencies and competitive capabilities. C. an increased ability to cut R&D expenses and an increased ability to avoid the problems of strategic alliances. D. that outsiders can often perform certain activities better or more cheaply, and outsourcing allows a firm to focus its entire energies on those activities that are at the center of its expertise (its core competencies). E. the ability to avoid capital investments that accompany vertical integration and a desire to reduce the company's risk exposure to changing technology and/or changing buyer preferences.

Option D. that outsiders can often perform certain activities better or more cheaply, and outsourcing allows a firm to focus its entire energies on those activities that are at the center of its expertise (its core competencies).

Explanation:

Outsourcing is the use of external entities to undertake the key business activities. When we outsource certain value chain activities makes strategic sense if only the activity can be performed better or more cheaply by outside specialist, ifthe activity is not crucial to the firm's ability to achieve sustainable competitive advantage, he outsourcing improves organizational flexibility and speeds time to market and also leverage its key resources, and do even better what it already does best.