Nielsen Marketing Research (NMR), with operations in 29 countries, produces and disseminates marketing information. Nielsen has been the primary supplier of decision support information for more than 70 years. NMR’s most recognizable product is the Nielsen television ratings. Nielsen is one of the largest users of computer capacity in the United States. Its information system consistently ranks above average in efficiency for its industry. NMR hired IBM to evaluate outsourcing its information processing.

NMR wanted to know whether outsourcing would allow it to concentrate on giving its customers value-added services and insights, increase its flexibility, promote rapid growth, and provide it with more real-time information.

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What are the benefits and risks of outsourcing for NMR? Do the benefits outweigh the risks? Explain your answer.