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The pitfalls of outsourcing

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BPO : Procurement Outsourcing

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Accenture Named Top Firm for Procurement Outsourcing in Financial Services Industry, According to Everest Group | Reuters

Accenture (NYSE: ACN) has been named the leader in procurement outsourcing services within the financial services industry by Everest Research Institute, part of Everest Group, a leading global consulting firm specializing in sourcing strategy and implementation. Accenture topped the list because of the company`s experience, breadth of service offerings and 95 percent market share by annualized contract value. A total of 17 major service providers across the globe were evaluated for the report, entitled, Procurement Outsourcing in Financial Services: From Wall Street to Martin Place." As part of the study, Everest Group reviewed multi-year contracts that involved the outsourcing of three or more activities ranging from sourcing to payment.

via www.reuters.com

Genpact Ranked Top Procurement Outsourcing Provider in Black Book 2009 Annual Survey

Genpact (NYSE:G), a leader in the globalization of services and technology and a pioneer in managing business processes for companies around the world, announced that it has been named the leader in full service end-to-end procurement outsourcing by the Brown-Wilson Group’s 2009 ranking also known as the Black Book of Outsourcing. This marks the third consecutive year that Genpact has been recognized as the top Procurement BPO provider.

via www.businesswire.com

Electronics Manufacturing Outsourcing Survey

The Bear Stearns Fourth Annual Electronics Manufacturing Outsourcing Survey questioned the world's leading, mid-tier and emerging original equipment manufacturers from a wide variety of industries. Of the 150 companies polled, 104 replied--representing 71% of the estimated $772 billion in electronics hardware sold worldwide. Some of the key findings of the survey include:

-- 85% of OEMs plan on increasing their outsourcing during the next 12 months.

-- OEMs plan to increase their dependence on contract manufacturers for printed circuit board assembly and full box-builds. The increase in full box-builds will represent significant incremental revenue due to extra material and labor
costs.

-- The average OEM hopes to outsource approximately 73% of its total manufacturing, more than five times the current industry estimate of 13% outsourced.

-- 40% of the OEMs responding indicated they were hoping to outsource 90% to 100% of their final product, indicating a move towards a virtual manufacturing model in which all of a company's manufacturing would be done by contract manufacturers.

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Procurement outsourcing spikes in recession

And while indirect spend remains the biggest focus area, "procurement outsourcing is now being tailored to include all aspects of the procurement lifecycle, from strategic sourcing and procurement operations (often extending to accounts payable) to the development and management of e-procurement platforms," says the Black Book.

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Procurement Outsourcing reduces cost of Companies

The two main objectives of procurement outsourcing is reduction in cost and tightening of focus on core competencies.

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The Recession and the Outsourced Supply Chain

Less demand means fewer transaction fees associated with supply chain services. These companies have minimized their fixed overhead costs, ...

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Offshore or Near-shore?

In order to continue providing up-to-the moment authoritative coverage of the global supply chain, World Trade has partnered with the well respected consulting firm Grant Thornton to survey sourcing trends within leading U.S. manufacturing companies.

In the following excerpt on sourcing practices and trends, Grant Thornton reports that a substantial number of the three-quarters of major U.S. companies currently sourcing internationally have made changes or are planning to make changes to alter supply chains to source closer to home. These changes are being driven by considerations other than price, such as supply chain resiliency and responsiveness, suggesting the many more—and more complex—variables entering into supply chain decisions.  

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Outsource supply chain to survive downturn

Concepts:

manufacturers, ZDNet, Asia, supply chain, business, costs, reports, economists, logistics, community, capital investments, lean, technology, industry, management.

Summary:

This remedy will prove particularly useful for manufacturers that are able to outsource their supply chain and farm out capital costs to service providers.

Saj Kumar, vice president of SAP Asia's discrete manufacturing industry solutions group, said manufacturers in Asia, especially those producing high-tech products and automobiles, have been badly affected primarily because the market for their goods is U.S.-centric.

Agreeing, Loh told ZDNet Asia in an e-mail that companies can outsource supply chain management (SCM) and make strategic use of SCM applications that automate transactions and information flow, and free resources to better meet fluctuating market needs.

"Apart from improving efficiencies in managing exchange of information, employing SCM helps companies remain flexible and responsive to the demands of the changing environment, which are key to survival in a recession climate," Loh said.

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PO Annual Report 2009: Shifting Buyer Preferences Dictate New Engagement Models

The Procurement Outsourcing (PO) market remains on a growth trajectory, and witnessed 30% YoY growth in 2008, primarily driven by organic growth and continued buyer interest.

Everest Research Institute analysis indicates that the increase in single-process contract signing activity in 2008, coupled with higher granularity in process and category scope in PO contracts represents a shift in buyer adoption pattern.

PO Annual Report 2009: Shifting Buyer Preferences Dictate New Engagement Models

Methods to Do Online Business Through China Outsourcing

The potential to lead in international trade is a issue in China outsourcing but the online business supply chain which is supposed to get raw materials to assembly finished goods to retail units on time is an issue. ...

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ICG Commerce Increases Spend Under Management

Results Underscore Trend of Fortune 1000 Companies Increasingly Looking to Procurement Outsourcing to Maximize and Accelerate Cost Reductions.

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IBM to Support Procurement for Unilever

IBM (NYSE: IBM) announced an agreement to support the transformation and ongoing management of procurement operations for Unilever Europe's ...

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Sourcing Expands Role in Outsourcing

The Services Shift: Seizing the Ultimate Offshore Opportunity: Robert E. Kennedy, Ajay Sharma: Books ISBN: 0137133502 ISBN-13: 9780137133505

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“Global Sourcing of Services is a powerful source of competitive advantage as economic borders become thinner... Kennedy pulls up the curtain and explains the what, why, and where of offshoring. His work with both providers and customers illuminates both the potential and the challenges of global sourcing. The Services Shift provides insights on the shifting business paradigms. This book cuts through the rhetoric and provides managers practical advice. A must read!!!”

– Anurag Jain, Managing Director, Asia Pacific; President for Applications Solutions (AS); and President of Insurance & Business Process Solutions (IBPS) for Perot Systems