Outsourcing in general
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Outsourcing in general
Outsourcing in general1. What is outsourcing 2.Spectrum of outsourcing 3.Why company outsource 4.outsourcing risks 5.outsourcing process 6.drafting an outsourcing contract 7.concerns of outcourcing in scm 8.myths of outsourcing in scmWhat is outsourcing? What is outsourcing? Outsourcing is subcontracting a process, such as product design or manufacturing, to a third-party company. Outsourcing is defined as the contracting of one or more of a company's business processes to an outside service provider to help increase shareholder value, by primarily reducing operating cost and focusing on core competencies.The entire spectrum of sourcing
To obtain components for products or services from sources outside the organization.Transfer tasks that were performed outside the organization into the organizationOutsourcing overseas or in a separate countryOutsourcing to cheaper overseas, still geographically closer locations, e.g. Canada and MexicoOutsourcing to cheaper rural areas in the United StatesLeast expensive but sometimes most difficult to manageWhy do companies outsource?Why do companies outsource?Reduces administrative burdensFocus on strategic areasReduce costsFocus on core functionsAcquire new skillsAcquire better managementAssist a fast growth situationAvoid labour problemsFocus on strategyAvoid major investmentsWhy do company outsource?Why do company outsource?Handle overflow situation Improve flexibilityImprove ratiosJump on to bandwagonEnhance credibilityMaintain old functionsImprove performanceBegin a strategic initiativeOutsourcing RisksOutsourcing RisksShort term:pricing issuesoperational issues at supplier's endLong term:non-performance by a suppliernonalignment of company's goals with supplier's goalsOutsourcing ProcessOutsourcing Process1. Understanding company goals and objectives3. A strategic vision and plan4.Selecting the right vendor5.Management of the relationships6. A properly structured contract7.Open communication8.Senior executive support9.Use of outside expertiseDrafting an Outcourcing contractDrafting an Outcourcing contractWhy and what to be outsourced??Clear business objectivesInternal and external benchmarkingDevelop performance and cost targetsDevelop initiative-based targetsFulfillment of initiatives beneficiary for both partiesReview performance regularlyExpand or shrink the relationshipConcerns about Outsourcing in SCMConcerns about Outsourcing in SCMFear of losing controlLack of confidenceLack of outsourcing educationManagement philosophy and traditionMyths of Supply Chain OutsourcingMyths of Supply Chain OutsourcingMy Outsourced partners are all supply chain expertsPartners have state-of-the-art IT infrastructureBy outsourcing production and fulfillment, no need to worry about executionOutsourced partners will provide expert project managementOutsourcing automatically gives a time-to-market advantageFulfillment is easier to outsource than manufacturingThank youDownload 469.24 Kb. Do'stlaringiz bilan baham: |
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