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HomeProcurementFive Key Success Factors with Outsourced Partners

Five Key Success Factors with Outsourced Partners

Entrepreneurs and small business people are always looking for creative ways to accomplish more of their business goals at a lesser cost. Many of these firms have turned to outsourcing for manufacturing, engineering, and other functions. Companies that outsource concentrate effort on core areas of expertise or strategic importance, reduce costs, and improve services. Companies that embrace these key points are more likely to experience a boost in sales and reduced commercial operations costs.

outsource design flow
Diagram extracted from Bret Caldwell, et.al. (2012)

Success Factor 1: Defining Success

All key stakeholders within an organization (e.g., IT, sales, and marketing management) must agree on the meaning of “success” before outsourcing their operations or services. In addition to cost savings, companies can employ an outsourcing strategy to better focus on core aspects of the business.

Outsourcing non-core activities can improve efficiency and productivity because the outsource partner performs these smaller tasks better than the company itself. This strategy may also lead to faster turnaround times, increased competitiveness within an industry and the cutting of overall operational costs.


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Ravinder Singh, DPSM
Ravinder Singh has more than 15 years of work experience, and in recent years has been responsible for the procurement of medical consumables in the healthcare sector. He is a member of the Singapore Institute of Purchasing and Materials Management (SIPMM). Ravinder completed the Diploma in Procurement and Supply Management (DPSM) course on September 2018 at SIPMM Institute.
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