The Operations And Innovation : Be More Ruthless About Terminating Loss Makers

Ferreira, J., & Prokopets, L. (2009). Does offshoring still make sense? Supply Chain Management Review, 13(1), 20-n/a. Retrieved from http://search.proquest.com/docview/221135949?accountid=12085

The Reshoring Initiative is focused on helping companies shift collective thinking from “offshoring is cheaper” to “local reduces the total cost of ownership.”

In 2004, Global Information Systems, Inc. began to put into motion the consideration of offshoring 3,000 jobs from here in the U.S to company locations in China, India and Brazil. These were highly compensated job positions. About half of GIS is separated into a division known as Global Services Divisions. A considerable portion of GSD’s business came from customers outsourcing their business process needs. GSD began to seek ways to cut costs and improve performance by “offshoring” certain activities in order to present the most attractive value proposition to potential customers.

The top opportunity identified after completing the T-Box Organizational Productivity for Bridgestone Americas, Inc. is offshore outsourcing. This opportunity would provide alternative options for resources that will lower costs. As a project manager for the IT Project Management Office, we are given budgets for each project that have to be closely monitored. Normally, an offshore resource per hourly rate is lower than a company employee or domestic companies. The lower hourly rate would allow more hours to be worked on the project resulting in increased quality of application or product. In addition, customer satisfaction is achieved while delivering projects under budget. According to Gupta (2009), “offshore outsourcing can lead

Outsourcing, especially offshore outsourcing, is not a new topic, but a continuing controversial global trends for the industry of manufacturing, and information technology. As Corbett said, outsourcing is the practice of transferring non-core competitiveness jobs to other suppliers rather than doing it self. Many experts are arguing that offshore outsourcing will harm the U.S. economy than it will benefit the American people in the long run, while advocates can also list a bunch of benefits over adverse. However, the practice of offshore outsourcing has been going on for decades, and it wasn’t resulting as opponents’ claimed. Instead,

For years the U.S. has seen explosive growth in the offshoring of services to many locations around the world. Many organizations are taking advantage of these opportunities because of the benefits to them and their customers. In order to compete with other companies many businesses are finding it necessary to outsource to other countries. Offshoring has produced some economic benefits but it has also created problems such as, work performed in remote areas that fail to meet quality standards, exploitation of workers, and lower environmental standards, especially in developing countries. These

Offshoring has its advantages as well as it disadvantages, as most business decisions do. It is the weighing of those two leverages that make the debate of offshoring such a conflict. Offshoring reaps many benefits for companies. For starters, offshoring allows companies to stream their productions globally. With this they may then begin to cut cost of goods to a lower rate to increase the demand, a plus for both the company and it’s consumers. This investment also acquires new customers and even puts the companies into new market

For Customer service, supply chain is all about proving the logistics of delivering the right products at the right time. Sounds simple but there are factors such as: reordering the product, supplier inventory is not enough, no consignment storage, delivery time not met, redesigning the planning. This challenge is effective and significant on both downstream and upstream of the process it affects the downstream as business partners are the one being effected upon the ordering and delivery of the product as without the product delivered they can’t start the next phase of their process; as for upstream this is extremely effective not just as revenue stream but to honor the continuous partnership shipping and delivering the product to customer is critical. Cost control of operating expense in direct and indirect commodity costs, logistic agile costs under pressure upon rising fuel/energy and freight cost, global business partners, technology investment, labor cost of recruits and manufacturing floor, and always the

Debates between business professionals regarding risk and benefits of outsourcing is becoming increasingly heated with particular focus on risks as unanticipated costs, potential for setbacks, integration difficulties, quality or benefits as minimize overall cost, focus on other business area, meet customer demand and flexibility. However, being prepared, done the research properly, hire the right company can bring plenty of benefits to an organization looking to outsource different aspects of their business. Rudzki, Smock, Katzorke, and Stewart (2005, pg.8) cover the significant importance of outsourcing as part of supply chain management and acknowledge the enormous role on raising customer satisfaction, driving higher profit margins, and fueling growth otherwise known as increasing company profitability. To understand how the risks and benefits of outsourcing could affect the company profitability, extended supply chain and how cost becomes value needs to be study. This paper will examine Boeing 787 Dreamliner product development and unconventional supply chain supply where best suppliers were considered partners and shared the risks of this product development.

In today’s global business competitive environment, business organizations must innovate and adapt new strategies to sustain revenue generation, value while remaining competitive. Organizations have embraced outsourcing principles and adopted them to help in expanding to new markets. Outsourcing has enabled US multinational corporations to reduce costs and compete effectively in the global market. While the proliferation of outsourcing has been beneficial to short term growth by taking advantages of; low wages, taxes and investment incentives in developing countries, it will significantly dissolve the competitive advantages the United States enjoys. The outsourcing approach changes the historical model of economies of scale, the resulting intangible and hidden trade costs of outsourcing shall have a heavy bearing on the US economy. The competitive advantage of high technology, support for startups will be gradually eroded, enabling developing countries to compete directly with the United States.

There are a multitude of strategic dimensions associated with sourcing and shoring techniques in the marketplace, conducting business abroad, and conducting business on the home front, or near the home place. These strategic dimensions include (a) domestic outsourcing (b) insourcing (c) backsourcing (d) offshoring (e) offshore outsourcing (f) onshoring (g) nearshoring (h) strategic outsourcing (i) business process outsourcing (BPO) and (j) offshore service providers (OSPs). These sourcing and shoring techniques can be complicated to understand. Domestic outsourcing is when a company decides to let go of an in-house job to go to another domestic company to perform (Koku, 2009). Insourcing is bringing back work internally that was previously outsourced (Nodoushani & McKnight, 2012). Backsourcing is rescinding the product or service back to the home country where it came from originally. Offshoring is when a company from one country outsources work to businesses in another country by either conducting operations in the foreign country, or subcontracting this work out through outsource providers who then transfer this work overseas (Chadee & Ramen, 2009; Koku, 2009).

There are both direct and indirect possible impacts of a global supply chain on the orderly production, distribution and sale of the company’s products. Third party vendors conduct these major functions.

We are all aware about the importance of supply, manufacturing and operations chain for any business. It becomes even more important if we are crossing the borders and entering international marketplaces as we are

When the offshoring is to be done so as to beat the competitors, the stakeholders will be affected in that the suppliers of the raw materials will be disadvantaged due to stoppage of their supply as a result of sourcing cheap raw materials and a reduced delivery cost from other countries. The community surrounding the company will also be affected as the suppliers since it’s the source of the raw material while the owners will be advantaged by the reduced production cost leading to high-profit gain.

During last decades, lots of companies in developed countries have moved their production processes from the origin country to other developing countries in the East, Southeast and South Asia (Tate et al 2014), so-called offshoring or outsourcing activities. This practice occurred strongly as a trend in the manufacturing industry due to economic and strategic objectives such as lower overseas labour cost, location advantage cost, related government and