The Chief Executive Officer (CEO) has announced that the hardware division will be sold to another company.
The sale of this division is an example of which of the following?
A. Outsourcing
B. Relocation
C. Business process change
D. Business merger
Business Merger/Acquisition Changes that come in the form of mergers or acquisitions can lead to project changes or sometimes project cancellations. For the exam, it’s important to understand the difference between a merger and an acquisition. A merger is when two businesses come together to perform business as one organization.
Once the merger is complete, they are one entity. An acquisition is when one business takes over another. The organization performing the takeover has the power and authority and becomes the decision maker for both organizations. Mergers or acquisitions could change the overall objectives and goals of the project.
Business Demerger/Split A demerger or split is the opposite of a merger or acquisition. The organizations that merged or were acquired decide to break into separate entities. A demerger or split is also likely to change the overall goals of the project or perhaps cause its cancellation.
Business Process Change Business process changes typically occur within the organization. An example of a business process change is automating a process that previously was performed on paper. If your project has anything to do with this process or is impacted by the process, changes will be coming your way.
Outsourcing Outsourcing occurs when an organization uses external resources to perform business processes and tasks. Outsourcing usually involves hiring outside companies to perform business functions or tasks such as payroll, information technology, security,
janitorial services, and so on. Outsourcing project team members, for example, by bringing in consultants to help with the work, can alter the make-up of the team. You should watch for team cohesiveness when there are outside members and make certain to nip conflicts before they arise.