Outsourcing (Offshoring)


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Outsourcing (Offshoring)

  1. 1. OUTSOURCING 1 www.procexcellenz.com <ul><li>Spend Analysis </li></ul><ul><li>Strategic Sourcing </li></ul><ul><li>Managed Services </li></ul>
  2. 2. <ul><li>CORE Process </li></ul><ul><li>Commodity-wise reshaped Sourcing Strategy with a 3 to 7 year outlook </li></ul><ul><li>Integrated solution to identify and develop Suppliers and Parts </li></ul><ul><li>End-to-end Program management & delivery </li></ul><ul><li>ENABLING / GOVERNING Processes </li></ul><ul><li>Support infrastructure for Ongoing improvement and management of Supplier processes </li></ul><ul><li>Supplier conditioning to World-class standards of Excellence (or) to Client norms </li></ul><ul><li>Change and Issue management at Supplier facilities </li></ul>Services Architecture 2 www.procexcellenz.com
  3. 3. Suite of Solutions Develop a 3 to 7 year Transformational Road map 6 Sigma rigour applied to addressing the Client’s CCRs Plain components re-sourcing from Source A to Source B Project Management rigour in implementation Support Enabling & Governing processes On-the-ground support to drive Supplier Excellence initiatives Complete Outsourcing of the Purchasing & Supply Chain functions End-to-end Purchasing support for the India Supply Base Manage Time, Cost & Resource challenges for the Client’s Supplier focussed initiatives On-site support to drive Program completion Provide IT solutions for real-time Customer and Supplier collaboration communication & reporting Supplier Training, 6 Sigma & Lean VST 3 www.procexcellenz.com
  4. 4. India Team 4 www.procexcellenz.com
  5. 5. Manufacturing & Sourcing in 2020 <ul><li>Study involving 152 respondents in 8 countries </li></ul><ul><li>Sector spread of the study </li></ul><ul><ul><li>General Manufacturing (40%) </li></ul></ul><ul><ul><li>Automotive, Aerospace & Defense (16%) </li></ul></ul><ul><ul><li>High Tech (20%) </li></ul></ul><ul><ul><li>Industrials : Chemicals, Steel, Medical Devices (24%) </li></ul></ul><ul><li>Geographical spread of the study </li></ul><ul><ul><li>US (18%) & UK (18%) </li></ul></ul><ul><ul><li>Germany (17%) </li></ul></ul><ul><ul><li>France (13%) </li></ul></ul><ul><ul><li>Sweden (12%) </li></ul></ul><ul><ul><li>Netherlands (11%) </li></ul></ul><ul><ul><li>India (8%) & China (3%) </li></ul></ul><ul><li>Dimensions of the study </li></ul><ul><ul><li>Engineering and R&D </li></ul></ul><ul><ul><li>Manufacturing </li></ul></ul><ul><ul><li>Supply Chain & Logistics </li></ul></ul>5 www.procexcellenz.com
  6. 6. Engineering and R&D Supplier Collaboration <ul><li>50% predict higher collaboration with Suppliers </li></ul><ul><li>More collaboration required when Outsourcing is involved </li></ul>6 www.procexcellenz.com
  7. 7. Engineering and R&D Product Lifecycle Management <ul><li>25 to 50% levels of product lifecycle shrinkage expected </li></ul><ul><li>Shrinking lifecycles will put inevitable strain on Supply Chains </li></ul><ul><li>Supply Chains must be Lean, Responsive and Flexible </li></ul>7 www.procexcellenz.com
  8. 8. Manufacturing Globalization <ul><li>Manufacturing will be for Global markets. A shift from manufacturing in one country to multiple countries expected </li></ul><ul><li>Proximity to raw materials and consumers, labor wage differentials, forex dynamics etc. will be key drivers </li></ul>8 www.procexcellenz.com
  9. 9. Manufacturing Subcontracting <ul><li>With 56%, the balance is tipped in favor of subcontractors to help develop products for the future </li></ul><ul><li>The standardized products will be subcontracted while specific products will be made internally </li></ul><ul><li>Regular visits or a Local Management Team will remain while IT based Management & Reporting Systems deployment will increase </li></ul>9 www.procexcellenz.com
  10. 10. Manufacturing Low-Cost Labour <ul><li>Manufacturing and Sourcing from cost-effective countries will increase despite partial erosion of the labor cost advantage </li></ul><ul><li>Logistics, distance, travel time, customs regulations, open market issues, accessibility, geopolitical stability and local expertise leadership could also be other determining factors </li></ul><ul><li>China and India will still continue to be preferred destinations </li></ul>10 www.procexcellenz.com
  11. 11. Supply Chain & Logistics Overseas Suppliers <ul><li>An increased reliance on Overseas Suppliers is expected in the future </li></ul><ul><li>40% wish to involve and collaborate with Suppliers right from the Concept to the Development process </li></ul><ul><li>60% of companies expect to be sourcing from more countries in the future than today </li></ul><ul><li>Closer relationship management envisaged . Co-location of Suppliers alongside Customers to increase. </li></ul>11 www.procexcellenz.com
  12. 12. Supply Chain & Logistics <ul><li>General agreement exists that Cost uncertainties or escalations could drive increasing complexity into our Supply Base positioning </li></ul><ul><li>Given the picture, proactive action to normalize Cost risks will be imperative. </li></ul>Cost of Commodities 12 www.procexcellenz.com
  13. 13. Supply Chain & Logistics <ul><li>Deployment of more sophisticated and capable IT or Web based systems will be the global norm to improve real-time information visibility and communication </li></ul><ul><li>Acute Talent shortage foreseen in the area of Supply Chain management and IT integration </li></ul><ul><li>70% predict the overwhelming use RFID technology as a key enabler </li></ul>Coping with complex Supply Chains 13 www.procexcellenz.com
  14. 14. Supply Chain & Logistics <ul><li>Global Supply chains will have a diverse set of attendant risks </li></ul><ul><li>Companies must be capable of managing Business Risks by recognizing, analyzing and preparing to manage the vulnerabilities </li></ul><ul><li>Multiple options to mitigate these risks exist. Foresight and relevant action is the key. </li></ul>Supply Chain Disruptions 14 www.procexcellenz.com
  15. 15. Thank You !! 15 www.procexcellenz.com