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Author
Published
March, 2005
Summary
The when, what, why and how of a supply chains outsourcing process.
This presentation provides an overall description of the supply chains outsourcing process, from the initial business decision up to the implementation approach. The typical business trade-off elements are being discussed varying from the advantage to maximize your ROI versus typical disadvantages as dependency & the irreversibility of outsourcing. These trade-off elements can be grouped into 6 business aspects: finance, product characteristics, organization, strategy, dependency & flexibility. Once the decision for supply chains outsourcing is made a Logistics Service Provider (LSP) selection process is to be started. This selection process consists a/o of sending out a tender document (Request for Proposal) and capturing the contractual, financial and operational aspects into a Service Level Agreement. The most important conclusion is that outsourcing not automatically results in lower operational costs, but that a thorough implementation preparation is required to:
- verify if operational costs savings are feasible.
- embed the outsourcing processes in your organization to make savings opportunities actually possible
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