Global pressures, significant changes to the regulatory environment, labor issues, capital equipment upgrades through automation, shorter product lifecycles, fragmented product offerings, inconsistent global customer demand and problematic deliveries from ever smaller supplier inventories are just a few of the issues causing increased pressures to obtain more value from the resources at hand.
From all of these constraints, emphasis must be placed on the economic productivity of a corporation’s assets, as well as the assurance that future investment and support is best focused on those activities and capabilities that are considered core to the enterprise. Likewise, all activities and capabilities that are considered to be non-core in nature are best served to be outsourced to a third party service provider whose specialization will provide strategic value not otherwise available internally, nor appropriate for continued internal development and support.
Therefore, outsourcing of Indirect Materials to a third party service provider has emerged as a credible, strategic solution for many organizations. Significantly increased adoption of Indirect Materials outsourcing is evident over the last 10 years and appears to continue to accelerate in acceptance and value realization.
However, one must consider that there are a number of outsourcing models available, each with significantly differing outcomes and resultant strategic value. These business models range from local vendor managed inventory solutions, to procure-to-pay remote purchasing services, to end-to-end comprehensive third party outsourcing that spans across planning, sourcing, procurement, storeroom/inventory management, technical services, systems integration and program management.
Ideal Setech’s comprehensive BPO solution, focused on total cost of ownership reduction, will provide opportunities for improvement through the deployment of an optimized Indirect Materials program design and system configuration and will enable and assure best practices. The result is improved asset availability, optimized inventory, assured component availability, and increased employee satisfaction, effectively supporting corporate initiatives to decrease cost, improve revenue and increase profitability.