The Outsourcing Shuffle

Overview: Every product has a life cycle. There are hot new gadgets, mature goods, and end-of-life commodities. If one’s product is no longer the hottest thing out here, it may be time to adjust the business model. The new economy dogma that outsourcing creates value has turned out to be a strategic disaster for many companies in manufacturing industries. Companies that made bad bets, outsourcing manufacturing to outside contractors without fully understanding the strategic consequences, suffered serious repercussions. The result is that many companies are now calling into question, and in some cases reversing, their past outsourcing decisions. Managing the outsourcing continuum, depending on the point at which a product is in its life cycle, certain manufacturing outsourcing strategies will work better than others. As the product, changes so must the outsourcing strategy. The best companies manage the transition from one strategy to another, and do so for every product in their portfolio. A company could have a portfolio of different outsourcing contract manufacturers in operation at any one time. To get the details of these strategies refer to the article.

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Format: PDF | Size: 381KB | Date: Jul 2003 | Pages: 15