Outsourcing and the Flexible Firm; The Financial Services Industry

This chapter investigates, through a literature review, the increasing use of outsourcing by organisations and why this has become so prevalent in recent years. The use if an effective performance management system for outsourcing projects in the financial services organisation is considered as a means of ensuring success, and how outsourcing can be sustainable through the use of appropriate KPI’s. The research results give valuable information on the use of monitoring the performance of suppliers through the use of a clear framework for performance management, and how this will avail the organisation of the many potential pitfalls which may be encountered with outsourcing. Further work is recommended in the area of outsourcing relating to the use of effective performance management and key performance indicators, which are carefully chosen to reflect the markets the organisation operates in, to reduce the risk of failure

Innovation in Limited Markets: Managing PCP Projects in the UK Defence Industry

This chapter will outline guidelines developed to both support and enhance innovation within the context of procuring complex performance (PCP) contracts. Such contracts are currently being employed across a range of sectors where limited market conditions exist. Such contracts and market conditions are set to remain the dominant form of defence procurement strategy for the foreseeable future. The case of the Typhoon combat aircraft programme is presented as an example of a typical, large-scale, complex procurement programme for the defence industry. This is of great relevance with national defence budgets reducing over time as a result of environmental changes and continued economic uncertainty [1]. The MoD and the UK defence industry have developed new, contractual models for procuring complex equipment, such as aircraft and naval ships. These models involve the contracting for complex performance which has changed the paradigm in the relationship between the customer(s) (MoD, UK Armed Forces) and the supplier (UK Defence Industry). Outcome-based contracts for procuring complex performance (PCP) have been employed widely by the defence industry and other sectors in limited or oligopolistic markets. Ten theoretical propositions are presented in this chapter, to help us discuss PCP contracts the literature review will include, Servitisation, Complex Performance Models and discuss Innovation Strategies in the context of limited markets. This chapter will allow the reader to understand the level of influence that contracting for complex performance has had on the innovation strategies of UK defence companies and offer some lessons learnt from the case that moves us to towards some guidelines for enhancing innovation in limited markets

A framework for using business excellence models for performance improvement at operational level.

It is important that manufacturing organisations are able to measure their performance in a way that will enable them to better manage their organisation to achieve competitive advantage. This paper argues that there are already appropriate methodologies that have been developed for this purpose, namely self-assessment against quality awards and business excellence models. Subject to development to overcome their weaknesses, these can be used for measuring manufacturing performance at an operational level. The research reported here outlines the development of such a framework and its successful application to a case example of a manufacturing facility in the UK

Self Assessment: use at operational level to promote continuous improvement.

The European Foundation for Quality Management (EFQM) Excellence 2000 Model is widely adopted by organizations as a means of self-assessment to enhance performance. This self-assessment has focussed mainly on the company or strategic level, but it is argued here that the self-assessment process can be modified to more appropriately suit the different needs of continual improvement at an operational or departmental level. This paper reports a generic process, applicable to the majority of situations, whereby self-assessment can be developed to meet the continual improvement needs of individual departments. The development process involves the application of Grounded Theory Learning Activities to generate a set of departmentally relevant constructs or issues which are then reviewed against a simple five-step model of self-assessment to determine the most appropriate departmental approach. The process is illustrated through a case application showing the use of the methodology

Supplier replenishment policy using E-Kanban: a framework for successful implementation.

This paper provides generic implementation guidelines for an electronic supplier Kanban in the form of an eight-step implementation Framework. This has been tested, proven and realised, providing a clear process to follow. The steps provide a clear process from mapping and analysing the current situation, an analysis of potential suppliers with corresponding criteria, and an analysis of purchased items and bottlenecks in their use within the organisation. This includes a review of the types of Kanban, Kanban loop, supplier preparation for using the system and then the integration of processes to ensure success in its use. Operational issues are comprehensively covered, together with strategic aims and underlying problems that may impact upon success. The above approach can be used to both introduce new suppliers to the system and give assistance to other companies wishing to implement an e-supplier Kanban

Performance management of suppliers in outsourcing project: case analysis from the financial services industry.

This study investigates the characteristics of an effective performance management framework for outsourcing projects in a UK-based financial services organisation and how this may contribute to the success of the outsourcing arrangement. The analysis draws on outsourcing and performance management theory, and uses both primary and secondary data. Valuable information was found on objective setting, performance measurement and performance improvement in the outsourcing project. An adapted version of the Balanced Scorecard, termed a Logic Scorecard, is suggested as a measurement tool; a service credit system and a continuous improvement schedule used to enhance supplier performance. The performance management framework, which is one of the pillars of the supply chain operations reference (SCOR) model, was developed, and provides practitioners with step-by-step guidance for the implementation of performance management in outsourcing projects. This combines both suggestions for performance management before and after the outsourcing decision, thus considering the entire outsourcing lifecycle. The proposed 10-step framework for outsourcing not only incorporates strategic propositions but also shows its implementation at an operational level