Integrated firms ‘are set for success’ with global sourcing

New research suggests that firms looking to global sourcing as a part of their supply chain may meet with greater success if their own operations are already well integrated.

A team at the University of Twente in the Netherlands interviewed 82 purchasers from a multinational automotive manufacturer based in Germany – a truly international study.

They found that “internal integration is a precondition for external integration with suppliers, which accordingly has a strong positive influence on global sourcing success”.

In simpler terms, if you get your own house in order, you are more likely to reap the benefits of outsourcing on a global scale.

However, the researchers found some differences between the internal and external perspectives of the supply chain process.

Internally, they found that the clear communication of goals was an important priority, so everybody is clear as to what the company is working towards.

Externally, they found that it was more important to define ‘mutual contact points’ between organisations – again ensuring regular and clear communication.

The findings should make interesting reading for anyone considering global outsourcing, and who is keen to make it a resounding success.

With a structured internal approach to the process, combined with clear outward communication across your supply chain, your chances of making a substantial profit from the process should be much improved.