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Outsourcing

Strategic Choice to Purchase Some Activities From Outside Suppliers

Firm Infrastructure
Human Resource Management M
Support A
RG
Activities
Technological Development IN
Procurement

Service
Operations

Outbound

Marketing
Logistics
Inbound

& Sales
Logistics

IN
RG
A
M
Primary Activities
Outsourcing
Strategic Choice to Purchase Some Activities From Outside Suppliers

Firm Infrastructure
Human Resource Management
Human Resource Management M
Support A
Firms often purchase a portion
Technological Development RG activities
of their value-creating
Activities
Technological Development IN suppliers
from specialty external
Procurement who can perform these functions
Procurement more efficiently

Service
Service
Operations

Outbound

Marketing
Logistics
Inbound

& Sales
Logistics

IN
RG
Outbound
Inbound Operations Logistics Marketing

A
& Sales

M
Logistics

Primary Activities
Value
Value Chain
Chain with
with Typical
Typical Strategic
Strategic IS
IS
Mapped
Mapped onto
onto itit

EDI-Based Computer- Automated Expert Telemaintenance


Purchasing Integrated Ordering Systems for Expert
System Mftg. System Salespeople Systems

Inbound Operation Outbound Marketing


s Service
Logistics Logistics and Sales

Upstream Chains Downstream Chains


of Suppliers of Customers
Competitive
Discovering Core Advantage
Gained through
Competencies Core Competencies
Strategic
Competitiveness
Discovering Above-Average
Core Returns

Core
Competencies
Competencies
Sources of
Competitive
Advantage

Capabilities Criteria of Value


Teams of Sustainable Chain
Resources Advantages Analysis
Resources
* Tangible
* Valuable * Outsource
* Intangible * Rare
* Costly to Imitate
* Nonsubstitutable

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