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World Industrial Reporter » Market Trends » Top Three Outsourcing Targets

Top Three Outsourcing Targets

September 28, 2012

By John R. Brandt

Manufacturers today are unlikely to be excellent at every function required to profitably meet customer demand. Outsourcing is here to stay— and the 2010 MPI Manufacturing Study identified the top three outsourcing targets for plants:

·         Transportation (72% of plants report “all” or “some” of the activity is outsourced)

·         Fabrication (61% of plants)

·         Information technology (53% of plants)

The activities least likely to be outsourced are:

·         Customer service (84% of plants report “none”)

·         Purchasing (83% of plants)

·         HR management (78% of plants)

Outsourced Activities

 

All

Some

None

Combined All or Some

Transportation

35.9%

35.7%

28.4%

71.6%

Fabrication

10.6%

50.2%

39.2%

60.9%

IT

16.8%

36.5%

46.7%

53.3%

Maintenance

7.8%

36.3%

55.9%

44.1%

Electrical

13.5%

24.0%

62.6%

37.4%

Assembly

6.2%

27.0%

66.8%

33.3%

Design and/or R&D

7.4%

25.6%

67.0%

33.0%

Sales and marketing

6.9%

23.3%

69.8%

30.2%

HR management

6.4%

15.2%

78.4%

21.6%

Purchasing

4.9%

12.0%

83.1%

16.9%

Customer service

6.4%

9.2%

84.4%

15.6%

Source: 2010 MPI Manufacturing Study

 

Should you be outsourcing more — or less?

______________________________________________________________

The 2011 MPI Manufacturing Study, conducted by the Manufacturing Performance Institute (MPI), with partnership support from Thomas International Publishing Co., is now underway. Participants receive a 
free 24-page Executive Summary of this year’s findings and six months of free online access to benchmarks from four years of the study ($495 value): You can anonymously complete the study atwww.mpimanufacturingstudy.com. Participate by April 20, 2011.

© 2011 The MPI Group

Customer demand is again booming in many markets – and manufacturers are boosting inventories back to pre-recession levels to keep up. Savvy execs at these firms will adopt recognized best practices to guarantee timely deliveries, minimal inventory and maximum cash flow.

 

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Filed Under: Market Trends

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