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Go4customer Blog

Some Value Propositions Of Supply Chain Management Outsourcing


SCM or supply chain management companies traditionally focus on sourcing and procurement of ancillary goods and services. But beyond PO, SCM companies can explore buyer adoption and solution characteristics in many areas and profiles. These SM capabilities are possessed by certain BPO service providers in India.

In this fast maturing procurement outsourcing market, organizations are now realizing the budding benefits of outsourcing. These doles span across key supply chain functions like order management and fulfilment as well as logistics, inventory management, returns management and most importantly, master data management.

The main dimensions of the SCM BPO market are:

1. Service provider profiles

2. Buyer adoption trends

3. Solution characteristics

4. Market overview

5. Key business drivers

Since supply chain operations have been witnessing an increasing complexity, value proposition of outsourcing SCM processes has expanded a lot. As a result, favourable business outcomes have been created around several activities such as

1. Inventory management

2. Cash flow management

3. Good customer/vendor experience

Some robust SCM BPO capabilities are:

1. SCM BPO delivers a strong cost-cum-value proposition because it carries a strong linkage to the overall product life cycle

2. SCM BPO enables enterprises to address business issues such as inefficient cash-flow management, order-to-deliver delays, high inventory related expenses and low customer satisfaction rates (caused by inefficient customer care service).

3. Some unique challenges posed by SCM BPO are dependency on cross-functions, direct exposure with end customer, disjointed technology landscape and lack of mature service providers.

4. SCM BPO has been adopted by large enterprises. The supply chains here are defined around “product” life cycles.

5. A very high rate of offshoring arises due to SCM BPO alone.

6. Existing technology landscape readily gets improved within the predominant SCM BPO technology model.

7. Both logistics specialists and BPO providers are included in SCM BPO.

In order to identify SCM BPO processes, one has to understand that it is a specialized BPO which is quite unlike traditional call centres. Thus, it successfully renders a better value proposition that arises due to complex commercial models, technology incorporations and better skilled experts.


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