| | |
| Summary |
| Please note: The McKinsey Quarterly has agreed to a special arrangement for CEOExpress members that allows member access to their articles. Articles must be clicked on directly through the links below to gain access to this group of articles.
|
Loosening up: How process networks unlock the power of specialization
When it comes to outsourcing (and, indeed, to all interactions with other companies), most corporations cling to a managerial preference for tightly integrating the processes involved in producing and delivering goods and services. This tight control, across corporate boundaries, comes at a steep price—the loss of flexibility—for the more tightly coupled, or integrated, processes may be across suppliers, the less flexibility companies have to handle unanticipated problems such as a fire at a supplier's plant that forces delays in shipping key products. Is there a way to achieve high performance from suppliers without sacrificing the strategic value of flexibility?
The take-away: Companies need not trade off flexibility for integration in critical cross-company processes. By managing the activities of and relationships with suppliers as networks rather than production lines, companies can swap their tightly coupled processes for loosely coupled ones, thereby gaining much needed flexibility and improving their performance in the bargain.
Articles provided by The McKinsey Quarterly
© 1992-2003 McKinsey & Company, Inc
|
|
|
