Archive for April 3rd, 2009
Outsourcing can come in surprising forms
There is a traditional view of outsourcing which means that many firms consider it good for answering telephone calls or assisting with office and administration work but outsourcing can be of great benefit in all industries and business models. With the current financial situation placing a greater need to be financially robust, more and more firms are considering outsourcing and there may be one or two surprises in store when examining the different ways of outsourcing.
The construction of the automobile has came a long way since the first ever care but the greatest ever evolution came when Henry T Ford introduced the automation construction of an automobile and this process is still prosperous today. The use of machines plays a massive role in producing a car today but one of the world’s top names in the vehicle business may not be the great manufacturer that it used to be.
Porsche is easily one of the best loved makers of automobiles, being founded in 1931 and its reputation is mainly found upon being one of the most prestigious brands available. This sort of traditional and branding does not come overnight nor is taken lightly and Porsche are fiercely proud of how they are viewed by the market place. There have been many notable changes and developments in the automobile production elements but Porsche have adapted and remained a market leader.
One of the major shifts in the industry came in the 1970s and 80s when the automobile industry learned a lot from the Japanese manufacturers, notably Toyota, and the concept of Just-In-Time inventory control quickly grew popular. This is where suppliers would maintain stock until it was required, allowing the ultimate firm to lower their costs with regards to storage. This was a turning point for many car manufacturers in receiving larger profits but Porsche have managed to go one step further.
It was back in 1997 when the demand for the 911 vehicle was putting great strain on Porsche’s production capabilities that the firm took the decision to completely outsource the production of their Boxster range, with the privilege going to Valmet from Finland. It is said in some quarters that this alliance has led to an increase in the overall quality of the finished Porsche vehicle but all parties are silent on this topic. However, it does go to show that even a firm with such a prestigious name and heritage as Porsche can find improvements from utilizing external partners and outsourcing the vast majority of their work. For the Boxster and the Cayman, Porsche have been playing the role of designer whilst the Finnish firm brings their designs to life.
When outsourcing is being discussed, it is common to consider the Far East and emerging markets as the location for outsourcing but the need for quality as well as an affordable price has sown that there is the potential for outsourcing in all avenues and areas. The current economic trend means that all firms, not only Porsche, are having to revaluate their current partnerships and production techniques which may mean that there may be a shift away from the current methods but there is no doubt that there is a need for quality outsourcing and not just low cost outsourcing.
If your brand and image is based upon a reputation that has been built up over a number of decades, choosing the wrong outsource partner or making a decision based purely on cost may well see that image destroyed in no time at all.
