Outsourcing Less Extensive Than Assumed

Mention outsourcing and most non-business people envision a wholesale shift of activities from within a company to contractors. Not so, claims a research study by Arizona-based CAPS: Center for Strategic Supply Research and A.T. Kearney, a Chicago-based management consulting firm.

Eighty-six percent of the 165 companies in 24 industries surveyed said they outsource less than 25% of their overall business activities. Indeed, the average level of outsourcing among 14 activities, including manufacturing, was 15.8%. Even in information technology, which among the surveyed companies was business activity most extensively outsourced, only 14% of companies said they outsource more than 25% of their IT activity.

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