Overview

To improve competitiveness in the global marketplace, companies are reducing costs through outsourcing --- the purchase of goods and services from suppliers. In many cases, outsourcing is less expensive for companies than producing these goods and services internally. Companies, however, do not always achieve their ultimate goal of competing more effectively. This is because decisions to outsource are primarily based on the promise of lower direct costs, without considering other source performance criteria that also impact costs and ultimately competitiveness. Corporate Strategic Business Sourcing guides management in selecting the best sources -- those that will raise performance to world-class levels and improve competitiveness. To improve sourcing decisions, the concept of the Strategic Business Unit, or SBU, is applied to each source being considered to provide the company with goods and services. Following the SBU approach, similar product and service lines are grouped together in the corporation. As a result quality levels, delivery performance, customer service, and product enhancement, as well as costs, are more easily measured and improved.; Just as the focus of these five criteria leads to improved SBU performance, the same approach can be applied to enhance the performance of the individual sources of goods and services. This is accomplished by similarly quantifying and improving the quality, delivery, cost, customer service and product advancement performance of the companies' sources, whether outside supplier or in-house functions.

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9781280869082

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