Background: Bentley & Brooks (B&B) is one of the world's 10th largest multinational B2C
companies, producer of consumer goods focusing on the food and household product sector in
the industry. Despite many milestones, B&B is facing obstacles for outsourcing arrangements at
operational level yielding the goal of high innovation and continuous improvement.
Issues:
1)
2)
3)
4)
Lack of CI and innovation
No predefined approach to quantify the outsourced service levels achieved
Lenient contract condition for suppliers regarding deliverables
Weak strategies to ensure proper CI and innovation
Analysis:
Sourcing Decision Cycle Framework (step-by-step)
Make-or-Buy sourcing decision: Resolves whether a company should insource or outsource
its goods or services. B&B has a strong offshore and onshore outsourcing for many of its IT
services, communications, finance mainly from Europe and HR functions for maintenance
mainly from America
Selection: B&B makes long term relationships with outsourcing providers in order to bring
new innovation and CI on board
Contracting: The outsourcing contracts sustain over a long period of time usually 5-10 years,
in some cases contracts are subject to extension.
Scope: B&B has utilized its max level for outsourcing to maximize innovation and efficiency
Outsourcing HQ: A big concern to carefully select how efficiently the service will be received
from offshore. Such as Alphacorp, central HQ is in Europe, support centres in Portugal,
Tennessee and Chile.
Keep as is or change decision: Companies need to weigh the benefits received from
outsourcing. B&B has faced issues with Alphacorp regarding new innovations and CI not
efficiently coming to the company with many loose contract conditions.
Recommendation: For short term benefits B&B should try outsourcing with external companies
with revised contract conditions for a small span time leveraging a trial period to improve its CI
and innovations. For the long term, B&B should consider a new set of strategies and proper
quantity methods to weigh the outcomes including improvised contract conditions for all its
existing outsourcing partners.