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UPS and HP: Value Creating Ivey Case

1.Explain how and why should service level agreements be designed?

a.Why short term SLAs may be less equivocal than long-term SLAs?

b.How does the design of SLA influence information search and shape collective behavior?

2.How and why should total cost structures be established?

a.How can optimization of transportation costs adversely affect inventory costs?

b.How do functional boundaries that constrain info sharing impede such intent?

c.Why gain sharing promote collaboration and innovation?

i.How might a partnership develop metrics to quantify gain sharing?

ii.How could this process be difficult for such partnerships?

3.How and why to cultivate trust and risk sharing?

a.Why is trust important in strategic outsourcing partnerships?

b.What are the stages of trust? Why might partnerships need to go through these stages?

c.How can co-investing in assets with partners lead to risk sharing and lower transaction costs for partnerships


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