Book Summary Preview : Inside Outsourcing

The Big Idea

How can organizations use outsourcing to its full potential, as a strategic business tool?

Maximize your company’s efficiency, profitability, and cost-effective operations while allowing flexibility and building a greater customer franchise. From decision-making to implementation – to identifying what a company does more creatively than its competition- the big idea becomes clear not only through theory but in this book’s practical and detailed examination of strategic outsourcing processes. Backed up by case studies on Rolls Royce, Bethlehem Steel, Pharmacia Upjohn, Gillette, and DuPont, Inside Outsourcing offers points to help streamline your operations and maximize service quality.

First, what exactly is ”Outsourcing”?

It’s much more than just a fashionable term for getting a new caterer or cleaning service for the office.

Outsourcing is a management strategy by which an organization engages in contractual agreements to assign major non-core functions to specialized and efficient service providers. It is the strategic use of outside resources to perform activities traditionally handled by internal staff and resources.

Organizations that rush into outsourcing without fully understanding what they hope to gain may find themselves in a battle with a vendor who will supply services that make things worse rather than improving them.

Organizations choose to outsource because they expect it to be a cost-saving solution, or because they need the expertise of a particular service provider.

An organization should outsource its non-core functions so it can focus on its core competencies. Good outsourcing ensures maximum value of delivery to the customer. Good outsourcing frees managers to focus on core activities.

Before getting into any outsourcing deal, it is first necessary to ask:

• What are our core competencies?
• What is the nature of our customer franchise?
• Can we fix ourselves internally before we consider outsourcing?
• What can an outside vendor do that we cannot?
• What kind of relationship with a vendor is most appropriate?
• What kind of contract will we need with vendors?
• . . . . . . . . . . .

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