By Kevin R. Maromonte
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Extra info for Corporate Strategic Business Sourcing
Under this scenario, not only do the quality, delivery, cost, customer service, and product advancement levels being achieved while producing the products need to be assessed, but the source’s R&D efforts also need to be evaluated. The method used to assess performance and develop a Strategic Business Source for R&D is addressed in the next chapter. This chapter will only address sources for production services, with no responsibility for R&D. A Sample Case of Defining the Products of Production Sources To demonstrate the approach to developing a Strategic Business Source for production services, a sample case will be used to explain each of the six steps Production Services 15 in the process.
With the measured performance levels being achieved by the sources entered, comparison ratios developed and the weighting factors assigned, the SBS Delivery, Cost, and Customer Service Performance Matrix can now be completed. The matrix is completed by multiplying the performance ratios by the weighting factors, entering the values at the bottom of the matrix and summing them for each of the sources being considered to produce the anti-lock braking systems.
Since Strategic Business Sourcing decisions need to be based on the long-term benefits to the sourcing company, the source’s success in advancing its products also needs to be assessed and considered before the optimal source is selected. For example, sources of production services may be purchasing state-of-the-art production equipment through their capital investment plans. Also, the source may, through its R&D program, be designing new products which may benefit the sourcing company when they are available for sale.
Corporate Strategic Business Sourcing by Kevin R. Maromonte