Direct Telephone, headquartered in Newark, Delaware, is a call center that takes inbound customer support calls for various credit card companies. The fast-growing company is looking to reduce expenses wherever it can. Call center manager Doug Espinosa wants to look at placing a call center outside of the U.S., possibly in India, possibly in the Philippines, but more than like somewhere in South East Asia, in an effort to reduce labor costs. Corporate director Bonnie Kovach, on the other hand, would like to keep the call center in the U.S. in order to provide jobs to American citizens as well as support calls to improve national competitiveness. Both Doug and Bonnie are concerned with the fact that company profits have been slowing over the past three quarters. *** Question | Which of the following, if true, would strengthen call center manager Doug Espinosa’s argument for moving a portion of the business to another country? A) Lower labor costs are not likely to increase the quality of the service provided by the company. B) Direct Telephone offshoring would cause economic stress in the country where the new call center was located. C) Direct Telephone can increase profits with lower labor costs. D) Direct Telephone’s image is likely to be tarnished if Espinosa’s suggestion is implemented. E) Foreign economies depend on U.S. companies to offshore their products and services

Understanding Business

12th Edition

ISBN:9781259929434

Author:William Nickels

Publisher:William Nickels

Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment

Section: Chapter Questions

Problem 1CE

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Question

Direct Telephone, headquartered in Newark, Delaware, is a call center that takes inbound customer support calls for various credit card companies. The fast-growing company is looking to reduce expenses wherever it can.

Call center manager Doug Espinosa wants to look at placing a call center outside of the U.S., possibly in India, possibly in the Philippines, but more than like somewhere in South East Asia, in an effort to reduce labor costs.

Corporate director Bonnie Kovach, on the other hand, would like to keep the call center in the U.S. in order to provide jobs to American citizens as well as support calls to improve national competitiveness.

Both Doug and Bonnie are concerned with the fact that company profits have been slowing over the past three quarters.

***

Question | Which of the following, if true, would strengthen call center manager Doug Espinosa’s argument for moving a portion of the business to another country?

A) Lower labor costs are not likely to increase the quality of the service provided by the company.

B) Direct Telephone offshoring would cause economic stress in the country where the new call center was located.

C) Direct Telephone can increase profits with lower labor costs.

D) Direct Telephone’s image is likely to be tarnished if Espinosa’s suggestion is implemented.

E) Foreign economies depend on U.S. companies to offshore their products and services.

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