What To Know As You Consider Outsourcing Manufacturing
Companies that successfully develop a world-class supply chain, without exception, focus on four fundamentals.
Companies that successfully develop a world-class supply chain, without exception, focus on four fundamentals.
Many manufacturers stood to gain when Walmart opened its procurement process to a new wave of suppliers during its two-day “2015 Manufacturing Summit” held last week at its Bentonville, Ark., headquarters. But some manufacturers already are benefiting from the giant retailer’s 2013 pledge to spend an additional $250 billion on products supporting domestic manufacturing and American jobs over a 10-year period.
With Walmart on the top-5 client list of thousands of U.S. manufacturers, it’s not surprising that many providers are feeling the heat of new pressures in their relationship from America’s largest retailer.
For decades, the relationship between American companies and China was relatively uncomplicated: The world’s most populous country served as the best base for low-cost manufacturing of goods for the U.S. market and as a rising market for American products ranging from commodities to smartphones and other consumer goods. But this relationship has been changing rapidly, and growing more complex by the day.
For 30 years, companies have sought to outsource and offshore IT as a way to reduce costs and/or quickly improve performance. Mega-deals were done in the ’90s and then, after that market was saturated, lesser deals ensued.
Don Rongione, CEO of Bollman Hat Co. in Adamstown, Pennsylvania, had a unique ally in his effort to shift hat production from China to Pennsylvania—famed actor Samuel L. Jackson, who, along with other Hollywood stars, was a fan of the company’s Kangol 504 woolen knit cap.
In its earliest phase, offshoring was driven by cost reduction and limited to non-mission-critical work such as call centers, credit card processing and administrative work.
American businesses have been shifting operations offshore so that now international sales account for 60% to 80% of total sales. It’s time to brings things back to the States. William Holstein explains why CEOs need to rethink the impulse to go offshore.
For the fourth consecutive year, reshoring of manufacturing operations to the United States in 2015 failed to keep up with continued offshoring of factory output. In fact, an index compiled by A.T. Kearney showed the largest year-over-year decrease in reshoring-vs.-offshoring in the last 10 years.
Businesses that outsource research and development (R&D) overseas are more likely to innovate than those who outsource at home, says new research. IBM’s strategy of building research capability in places like Switzerland, China, and India mirrors that of GE, Intel and others. Ordinarily the purpose of outsourcing R&D was cost reduction, but many are now doing it to boost innovation as well.
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1:00 - 5:00 pm
Over 70% of Executives Surveyed Agree: Many Strategic Planning Efforts Lack Systematic Approach Tips for Enhancing Your Strategic Planning Process
Executives expressed frustration with their current strategic planning process. Issues include:
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2:00 - 5:00 pm
Female leaders face the same issues all leaders do, but they often face additional challenges too. In this peer session, we will facilitate a discussion of best practices and how to overcome common barriers to help women leaders be more effective within and outside their organizations.
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10:30 - 5:00 pm
General’s Retreat at Hermitage Golf Course
Sponsored by UBS
General’s Retreat, built in 1986 with architect Gary Roger Baird, has been voted the “Best Golf Course in Nashville” and is a “must play” when visiting the Nashville, Tennessee area. With the beautiful setting along the Cumberland River, golfers of all capabilities will thoroughly enjoy the golf, scenery and hospitality.
The golf outing fee includes transportation to and from the hotel, greens/cart fees, use of practice facilities, and boxed lunch. The bus will leave the hotel at 10:30 am for a noon shotgun start and return to the hotel after the cocktail reception following the completion of the round.