Report Benchmarks Outsourcing Strategies

Compiled By Traci Purdum Outsourcing is a fact of life for most manufacturers. Another fact of life is unsuccessful outsourcing due to outsourcing the wrong functions, according to a recent report from Cutting Edge Information, a Durham, N.C.-based business research company. The report, "Outsourcing From Strength," highlights practices from more than 50 companies across 20 industries. It includes metrics and strategic practices in vendor screening criteria and requirements, outsourcing market statistics related to size and composition, percentage of companies that outsource specific activities, key reasons why top companies are satisfied with their outsourcing relationships and typical outsourcing deal sizes and structures. Companies benchmarked include General Motors, DaimlerChrysler, Ford, Lockheed Martin, Microsoft, Dell, General Electric and DuPont. For example, the report outlines how Dell chooses vendors:

  • Identify Current Capabilities: The process starts with an internal review of what is being done and what needs to be done.
  • Create Roadmap for Success: Dell then commits to paper a process for choosing the vendor, agreed to be the decision-makers.
  • Develop Matrix: The team making the decision puts together a matrix capturing requirements and outlining a fair system for vendor comparison.
  • Gather Information: The team then gathers information from the sources at the bottom of the chart (provided in the report), including the vendors, the vendors' customers and outside experts.
"The world's best outsourcers understand where to create the most bang for the resource buck," says Jason Richardson, Cutting Edge CEO. "Regardless of where you are in the outsourcing process, learning from the top companies will help you zero in on those activities that are critical to your business -- and those that can be best performed by others." To download a free summary of the report go to www.cuttingedgeinfo.com/Reports/FL50_Outsourcing.htm. The full report is available for $495.
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