What does right sourcing aim to achieve?

Right sourcing aims to achieve a balance of sourcing options to ensure that an organization utilizes its resources effectively and efficiently. This approach involves evaluating different sourcing strategies—such as in-house, outsourcing, and partnerships—to determine which combination best meets the organization's needs and objectives. By striking this balance, companies can leverage the strengths of various sourcing methods while also addressing factors such as cost, quality, and flexibility in service delivery.

This strategic choice is crucial for optimizing performance since it allows organizations to allocate tasks and responsibilities based on competency and resource availability. For instance, core functions might be retained in-house to maintain control and quality, while non-core functions could be outsourced to specialist providers for efficiency.

The other options, such as contracting all services or outsourcing all non-core functions, do not reflect the nuanced approach of right sourcing. Instead, they represent more rigid strategies that can lead to inefficiencies or missed opportunities for optimal resource management. Similarly, maximizing fixed costs is contrary to the objective of right sourcing, which strives for agility and financial flexibility rather than committing to high fixed expenses.