In an extensive outsourcing survey by Pricewaterhouse Coopers,
respondents identified focus on core competencies and reduced operating costs as the main
reasons for outsourcing. Demand for outsourcing services is increasing due to the following
market trends:
- Increased Focus on the Firm’s Core Business
- Increased Competitive Pressures and Decreasing Prices
- Need for Global Capabilities
- Rapid Incorporation of Advanced Technologies
- Continuous Process Improvements
- Need to Improve Customer Satisfaction
- Mass Customization and Increased Complexity
- Requirement for e-Commerce
In order to meet the needs of both traditional vendors and emerging
e-Commerce vendors for the outsourcing of extended supply chain management processes,
an outsource provider must be able to offer services in the following areas: e-Commerce
support services, procurement, manufacturing, fulfillment, and customer relationship
management. While many outsource providers offer one or more of these services, there
are few providers that can offer all of these services on a globally integrated basis.
Companies seeking to outsource a significant portion of their business processes
require a provider that has the technological infrastructure and expertise to seamlessly
integrate these complex business processes with their own operations. Also, because
the outsource provider is often a direct link between two of the most valuable assets
of a company, namely its products and its customers, the outsource provider must have
the experience and expertise necessary to earn and maintain the trust of the company
as a reliable and integral part of its supply chain.
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