Outsourcing leads to the fragmentation and disintegration of the supply chain, inviting new competitors into the industry, and undermining pricing power and profitability.
Compounding the problem, outsourcing leads to the fragmentation and disintegration of the supply chain, inviting new competitors into the industry, and undermining pricing power and profitability.
And although such a fragmentation and disintegration of the value chain offers corporations a number of well publicized advantages, it has an unintended consequence: It makes entry of new competitors to the industry easier, intensifying competition, shortening product cycles, and squeezing return on invested capital.