Gizmo, Inc. is a diversified multinational manufacturer. The CEO is considering outsourcing the marketing research function to a global consulting firm. The consulting firm would charge a fixed annual fee of $1,100,000. At present, the costs of operating the marketing research department are $1,315,000 per year, as follows: Director salary $130,000 Staff salaries 800,000 Travel 105,000 Occupancy 75,000 Consultants 80,000 Executive VP 60,000 Overhead 20,000 Miscellaneous 45,000 The outsourcing firm would perform all duties currently performed by Gizmo personnel, as well as those of the external consultants. Miscellaneous expenses (supplies, etc.) would be eliminated. Travel costs would decline 90%. Occupancy costs reflect internal charge for office space in corporate headquarters. Cost for Executive VP reflect a charge for 15% of that individuals time. Overhead is an allocation of general corporate overhead. Required: Discuss the factors that the CEO should consider in deciding whether to outsource the marketing research function.