Answer (D) is correct . Firms may gain a competitive advantage by outsourcing those activities which can be performed more efficiently, and thus at lower cost, by outside providers. Doing this allows the company to expend its effort on those activities which it performs comparatively well, referred to as its core competencies.
Answer (A) is incorrect because To stay in business, a firm must focus on its customers whether it outsources or not.
Answer (B) is incorrect because Focusing on suppliers is not a strategy for gaining a competitive advantage.
Answer (C) is incorrect because Undifferentiated activities is not a meaningful term in this context.
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