Case Week 6 Xbox - GM598 International Business Case...

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GM598 – International Business Case Analysis Assignment: Microsoft - Outsourcing Xbox Production 1. What was the strategic advantage to Microsoft of outsourcing Xbox production to Flextronics? Microsoft’s primary business was to develop software. While the company also sells computer hardware, such as keyboards, these products represent a much smaller part of the company’s overall revenues. Consequently, when considering whether to produce the Xbox in house or to outsource, the company chose the latter strategy. In doing so, Microsoft was able to continue to focus on its core business while allowing another company, Flextronics, which has expertise in managing a global supply chain, to handle production (Hill, p. 577) 2. What were the risks associated with outsourcing to Flextronics? Did Microsoft mitigate these risks? Do you think Microsoft would have been better off making the Xbox itself? When a company makes the decision to outsource, it gives up control over the production
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Case Week 6 Xbox - GM598 International Business Case...

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