Outsourcing is one of the most basic ”make or buy“ decisions a business has to make. On the one hand, this focuses the business on its core activities, helps to reduce capital spending, increases flexibility and reduces personnel expenditure. On the other hand, the business becomes dependant on the service provider which is reflected in the interfaces and structures that are created to support the relationship. Furthermore, from the outside the contractor’s performance whether positive or negative is always associated with the customer.
The advantages of outsourcing can only be fully realized when the service provider selection process is based on care and experience. The decision should always be based on individual considerations, the ensuing costs and potential savings as well as on a rigorous risk assessment programme. Which parts of the enterprise can be outsourced? Is it possible to cooperate with a local and reasonably priced provider or is an international network required in the long run? Which provider will support the business above and beyond any contractual agreement should the requirements and business development change?
These are just some of the questions that need to be answered with certainty before making a decision of such paramount significance for the development of a business. This is a situation where Pierau Logistics as an experienced partner could provide critical support.
Our services at a glance:
- Definition, identification and assessment of current operational data as a basis for decision making. Joint agreement on definition of realistic goals that can be achieved by outsourcing.
- Based on current operational data: illustration of alternative concepts ranging from outsourcing though to other business models e.g. joint venture, logistics subsidiary or equity participation in the service provider. Cost-benefit analysis, economic efficiency analysis and the assessment of each option.
- Planning and implementation of necessary modifications within the business, ranging from internal processes through to IT interfaces.
- Definition of the scope of service, creation of a database, definition of specifications for the service provider and publishing tender documents.
- Objective and independent preselection of potential service providers. Setting up a truly competitive selection process which produces the best service package at a highly competitive price.
- Identification and development of KPIs
- Development of performance related pay scheme.
- Comparison of quotations along with assessment and recommendation. Support during negotiations, price discussions, contract preparation and conclusion.
- Project management, support and monitoring of the physical move and transition period.