More than half of corporate executives view non-core functions, such as transportation and logistics, as ideal outsourcing targets, a survey by Accenture indicates.
And the success rate with outsourcing seems high. Some 80% of those executives said their companies were able to cut costs, improve efficiencies, enhance customer service and revenues, or improve competitiveness with supply chain management initiatives. Based on that success, CEOs are looking seriously at outsourcing additional supply chain activities such as procurement to enhance performance, said Bill Copacino, a partner in Accenture’s supply chain management practice.
The slowdown in company revenues, which has inflated the ratio of supply chain costs to company sales, as well as increasing competitive issues, is accelerating the trend to outsourcing, Copacino said.
However, he also warned against focusing solely on cost cutting. Doing so can overshadow long-term strategic needs, which can be counterproductive at a time when supply chains need to become more global and customer focused, he said.
Accenture also said more than 70% of executives surveyed considered the Internet as one of the most important factors in facilitating greater collaboration with key trading partners because of the visibility it provides upstream and downstream in the supply chain.
Accenture, formerly Anderson Consulting, conducted the survey in conjunction with Wirthlin Worldwide, polling 150 CEOs, chairmen, and executive vps at a variety of Fortune 1000 companies.
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