By now,
organizations of all sizes and in all industries often outsource a
portion of their business activities. Whether outsourcing a single
task or an entire end-to-end process, choosing the most effective
areas involves an evaluation of many factors that often means
balancing conflicting cost, people and partner objectives. Some
of the many considerations include:
-
Critical
skills, processes and strategic competencies to retain internally
-
Trade
secrets and intellectual property
-
Control
sourcing of critical components
-
Ability
to change plans/control lead times
-
Identification
of true product cost and impact of fixed burden allocations
-
Personnel
development and retention
::
Advantages of outsourcing
While cost reduction is
often the driving factor, other common advantages may include: taking
advantage of supplier technology capabilities, focusing on core
internal competencies, shorter development/production lead times,
higher quality and better customer service. If your core competencies
include world class design and engineering, outsourcing production and
fulfillment often makes sense.
:: Why
outsourcing may not achieve goals
Many companies are not
satisfied with the end result of their outsourcing efforts- cycle time
hasn't been reduced, quality not improved, etc. Reasons
why may include:
-
Focus strictly based on
cost reduction
-
Partner not able to grow
with you and your requirements
-
Internal employee
resistance
-
Activities outsourced not
a true strategic advantage
-
Adversarial vs. shared-win
relationships
-
Inadequate contract
agreements and communications systems
:: What
to outsource: products, processes, people ?
Identifying outsourcing
candidates that best meet your company goals is a key decision that
may impact your business for years. The Bridgefield Group can assist
in identifying potential product and process candidates aligned with
your strategic goals, creating and prioritizing the financial and
business case based on company and industry knowledge, locating
high-capability partners, and creating the contractual and
communications systems that monitor fulfillment, provide relevant
performance measurements and allow for shared future growth.
For more information
about our outsourcing evaluation assistance and specific 15-step
program, please contact:
sales@bridgefieldgroup.com
