Outsourcing is Critical to Growth and Profits
A company's growth is critical to it's long-term success. Smart companies are realizing that and pushing for better performance from everyone in the company and their supply chain partners.
In the June 2006 Harvard Business Review, General Electric CEO Jeff Immelt said, "Another decade of 4% growth, and General Electric will cease to be a great company." Immelt said to really maintain its place at the top of the Fortune 500, he has committed the company to 8% organic growth.
But to fully support growth, a company must operate its supply chain at peak efficiency to meet the demands of its customers.
How can outsourcing maximize a company's performance? Our client Redback Networks serves as a perfect example.
Today, at Managing Automation's Progressive Manufacturing Summit 2006, Redback Networks was selected as one of the top five winners in the “Business Model Mastery Category.” Redback received recognition for its business strategy of outsourcing its international logistics network to D.W. Morgan Company. Through its partnership with Morgan, it greatly improved its ability to meet its customer's stringent service level agreements, reduced the number of global service depots and saved 30% in operational costs.
Developing and mastering a streamlined supply chain may not be easy. Many companies are faced with the continued expansion of their operation to more remote locations around the world and work with partners of varying levels of process and technology abilities.
This is where the value of outsourcing becomes critical to the successful growth of the company. A recent survey by Northwestern University and Accenture of the largest manufacturers in the U.S., 80% of the logistics executives said they use some type of third-party services t handle supply chain activities---that's up from just under 40% in 1991. Reflecting continuing global expansion, approximately 60 to 65 percent of respondents said they need third-party help in Asia, Western Europe and Eastern Europe.
Many of our clients have turned to us as a outsourced logistics services and supply chain consultant. With our help, they can quickly ramp up business and capture opportunities in an emerging market without the upfront capital investments.
When our clients outsource to us, they see significant operational and financial improvements. Cost savings, increased ability to focus on the core business and improved process speed, quality and accuracy are just a few of the benefits that occur.
Need help seeing and managing your company's global supply chain? We invite your company to join the list of business leaders that are relying on Morgan as their outsourced partner in success.
David W. Morgan
Founder & CEO |
“Effective management of in-transit goods can reduce operational costs by as much as 20%”