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How To Maximise Both Efficiency And Effectiveness Outsourcing Business At The Same Time

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How To Maximise Both Efficiency And Effectiveness Outsourcing Business At The Same Time

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In his book The 5-STAR Business Network (http://bit.ly/5-STARBN), Vivek Sood talks about prophecies coming from an article written in the Harvard Business Review in 1999.

Efficiency And Effectiveness Outsourcing Business

Although this article was written almost 15 years ago, the authors, John Hagel III and Marc Singer, were very forward thinking about companies.

In fact, they foresaw organizations would focus so much on core competencies that they would specialize in one particular area of efficiency – customer relationship management, infrastructure and assets management, or competency and innovation management.

This is what de facto happened. Companies started to focus on core competencies and this unbundling led them to high specialisation.

Some organisations decided to put their money only in innovation and, as a result, they became highly specialised in innovation and new product development, which is good in some points, but reduces their general efficiency.

In other words, too much specialisation leads to high effectiveness in the area on which they choose to focus, but it reduces the general efficiency of the organisation. There are also companies that decide to focus on the consumers.

Thus, they concentrate their efforts in understanding the consumer’s mind and needs, but it prevents them from improving their products, in terms of innovation, and their infrastructure, in terms of asset management.

Therefore, to be efficient and effective at the same time, your company needs the support of its network. In fact, although focusing on core competencies is essential in today’s businesses, it is also essential not to neglect the other areas.

This is the role of your network. When talking about these new businesses in his book, Vivek Sood calls them “Super Networked Businesses”. In fact, you can focus on core competencies, as long as you have an appropriate network to back your core competencies’ processes.

Then, companies can reach effectiveness and efficiency at the same time by using strategically their business and supply networks. Besides, your IT system can help you reach these objectives in the global business environment.

One more time, collaboration with your partners is very important in this perspective. In effect, your business will benefit from synergies provided by the collaborative teamwork within the supply network, and you can go even further to achieve synchronicity.

The concept of synchronicity has been developed in a previous article and more information is also available in Vivek Sood’s book. Therefore, through the teamwork of companies’ networks, a process of re-bundling has been appearing since the 00s and 10s.

These companies are building super networked businesses, and collaboration enables to be efficient and effective, putting customer, innovation and infrastructure areas back together.

Today’s technologies and methodologies can help you build super networked businesses, especially using teamwork. In fact, all the areas within a company must be aligned with the same strategy and on the same features.

This is the reason why collaboration is important within the network, as well as within the organisation itself. This is the key for the success. Consequently, in this article, I would say the key word is “teamwork”.

This word reveals the importance of collaboration to build super networked business, which will be effective and efficient at the same time, in today’s globalised business world.

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1. These ideas and concepts will be usually expressed by our thought leaders in multiple forums - conferences, speeches, books, reports, workshops, webinars, videos and training. You may have heard us say the same thing before.

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ABOUT THE PRINCIPAL AUTHOR

Today, Vivek and his partners are among 20-30 people on the planet earth who have this deep understanding of supply chain systems, practices and tools. CEOs, COOs, executives and Boards call them in most challenging situations once they know the full potential of supply chain based transformations. Following are key milestones in Vivek's journey:

  • Started in 1983 as a merchant navy cadet at 18 years age, worked his way to qualify as a Captain – qualified to take command of any merchant ship, worldwide.
  • Earned a top tier MBA from UNSW at the top of his class.
  • Joined highly regarded strategy consulting firm Booz Allen & Hamilton, consulting to the CEOs, Boards and senior management of global corporations within Australia.
  • To learn and specialise in supply chain – against all odds, sought out the co-inventor of supply chain in Germany and convinced him to be a partner in his firm, GLOBAL SUPPLY CHAIN GROUP, launched in January 2000.
  • More than 500 successful blue chip projects with high impact business transformations in large corporations using the full power of SUPPLY CHAIN MANAGEMENT.
  • 4 Seminal and path breaking business books IN SUPPLY CHAIN MANAGEMENT – these are available in bookstores and universities and libraries worldwide.

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THE 5-STAR BUSINESS NETWORK

If you are deeply passionate about the world of business and supply chain networks as I am, and enjoy digging answers to critical questions that will help build and steer your business with wisdom, then join me. This book is a journey of exploration through the world of business networks that run along the veins of today’s commercial world.

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OUTPERFORM OUTSOURCE OUTPROFIT

The trend of outsourcing continues to grow unabated with the whole gamut of services, from simple to mission-critical tasks. There is not a single company on earth that does not outsource anything. It is not just about cost arbitrage, it is also a finer expression of division of labour at the organisational level. Like all leverage, outsourcing is a double-edged sword too. On one hand, it allows you to do more, faster. On the other hand, if it goes bad, it can easily kill your business. If you do not believe that is possible – you can google the Fox Meyer saga from the 90s and see for yourself.

4.3
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UNCHAIN YOUR CORPORATION

Businesses Are Chained By Unseen Chains. If You Are Looking For Ways To “Unchain Your Corporation” A Successful Business Transformation Is Required.

Successful Business Transformations Are Difficult, Yet Rewarding.

Business Transformation Is Fast Becoming A Question Of Survival In The Modern Globalised Era.

Modern Supply Chains Integrate Businesses And Economies Faster By Systematic Information Sharing From Internal And External Sources.

Companies Can Multiply Profits By Progressively Ramping Up Cohesion And Collaboration Of All Moving Parts In B2B Network To Achieve Tighter Integration.

4.3
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GREEN SUPPLY CHAIN – AN ACTION MANIFESTO

It is generally accepted that environmental consciousness is now changing to environmental proactiveness as organizations are discovering that it makes good commercial sense.

Boards are asking the management to review their policies related to environmental norms, not only to bolster their corporate social responsibility aims, but also because consumers are asking for greener supply chains

It is also widely agreed that consumers will increasingly prefer to buy more and even pay more for products or services provided in an environmentally sound manner.

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