Collaborative Onsite Outsourcing

In response to the article in LinkedIn: 5 Smart Reasons Employers Should Stop Hiring for Full-time Jobs written by J.T. O’Donnell,  I wrote that companies must utilise all forms of employment including full-time, part-time, outsourced and contracted. Only this will allow companies to get the best ROI from the available and seemingly diminishing pool of Supply Chain talent (I have included my original response below).

Today I find a paper published  by C.H. Robinson stating a similar fact. Their paper “Collaborative Outsourcing: How to gain value from a strategic onsite logistics resource” is focused on Logistics and how outsourced suppliers may need to place some of their own resources on site with their customer.

Not only is this good reading but is a good guide to what and how companies can optimise their requirements.

My original response to JT’s article: There many facets to the concept of “employment”, the problem as I read it, the author seems to be extreme one way and many of the comments extreme the other way. In reality there should be more project driven roles (contract) but this does not detract from the fact that there also needs to be a large part of the organisation that remains permanent. Companies should be utilising the best people for the particular task/function in the most appropriate manner. Some tasks/projects are always better to be managed by either outsourcing or having a person contracted for that project, remembering this can be a short term or long term/extended contract, other roles should nearly always be done on a permanent basis in-house (full-time or part-time). Aside from the perceptions of individuals many companies do not analyse their requirements correctly, too many focus on an immediate requirement or need and hire to an outdated expectation for example: “THIS should be a permanent role and we will have to hire a temp for THAT one”. Also: Project driven roles should not be considered “Temps” – there is too much negative stigma attached to this title, call them Project Contractors, for that is what they are. There are far too many people not being allowed to be the best they can, or to give the best they can to the company they work for, in any capacity, due to so much inaccurate and inconsistent thinking about what a “job” is.

* Supply Chain Trends – just how many are there?

The Supply Chain continues to change at an ever increasing rate.  This is primarily due to the advances in technology and the availability of massive amounts of information.

To keep up with current issues and the impending changes, all those associated with the supply chain need to keep abreast of the “trends” as the saying goes, forewarned is forearmed.  But, there is a fundamental problem that any forecaster of sales, demand, usage or even the weather can tell you, it is all a calculated guess.  The ‘guesses’ get better with the more history and validated algorithms you have.

The supply chain at this level is changing so rapidly history becomes redundant and there are no algorithms.  Plus there is a plethora of opinions, some of which in reality are just a marketing tool. I wanted to see if there were overarching trends across the supply chain so did some research across a wide range of companies and organisations.

I have found there is a trend to the trends, with some particular ones floating to the top, although the individual weighting/ranking of these is hard to define. But the 15 top trends based on my research are:

  • Technology: Technology is having a major effect on the total supply chain, from cloud computing to mobile solutions and smart phones to artificial intelligence.
  • Information/Communications: The volume and types of software along with the proliferation of data has changed the way the Supply Chain is managed, even viewed.  There are better processing systems as well as automated performance reporting and even supply chain simulation software.  And because of the web, the cloud, and the number of software developers, companies of all sizes can operate with the same tools, cost is no longer the barrier it was.
  • Collaboration: This is all about collaborative relationships and closer integration between supplier-&-customer and supplier-&-supplier as well as intra-company relationships.  A common theme stated is to “build the relationship and trust between and within, companies”. This is not a “nice to have”, it is all about building strategic alliances, its importance can be shown by the number of positions now advertised with “…. Alliance Manager” within the position title (although there are a lot that are technically sales positions)
  • Outsourcing: Companies are divesting themselves of the tasks they do not excel in. We are all aware of the growth of the 3PLs over the last 20+ years but 4PLs are also now a standard business arrangement.  This trend is also obvious with call centres (on- or off-shore) as well as other back-room functions. The use of contractors is also gaining momentum.
  • Flexibility: Companies must be able to tailor their supply chains and processes to accommodate 1- increasingly demanding customer requirements 2- needs of different customer segments (or diversification of sales channels) 3- current unpredictability of the supply chain (due to market, regulatory and geographical changes/problems)
  • Sourcing: This trend had multiple options; some suggest regional and local sourcing whilst others are suggesting global sources. There is also densification of products, decentralisation of production and greater focus on Total Cost in Supplier Selection.  This area has a lot of inherent risk and all companies should be continually reviewing their sources with an eye on the risks with each.
  • Reporting and responsibility: Governments are now better able to ensure adherence to regulations and as the world grows smaller, companies must comply with an ever increasing number of regulations and requirements. Investors are also requiring better, clearer and more visibility in company reporting.
  • Environment: This is a double edged sword. There is a ground swell of customers and governments requiring companies to be more environmentally responsible.  But there is a growing need to use all available resources more effectively to contain costs for example utilising or selling waste product.
  • Strategy: Companies need to reassess their all strategies from the emergence of control towers to proliferation of product types and re-alignment of the supply chain architecture/structure. But even more critical, the Supply Chain must be acknowledged as a major strategic asset.

Once the trends are known, it is imperative companies have strategies in place to manage these trends. This will not be an easy task as each industry and each company within that industry will need to define its own appropriate strategy.

Click here,  to see a sample of the sources I used along with their own summarised list of trends. Included are Hyper-links to the relevant sites or PDFs giving a detailed perspective.