Value chain outsourcing – a solution for flex-lean-agile manufacturing
by R.M. Ilyas, D.K. Banwet, Ravi Shankar
International Journal of Value Chain Management (IJVCM), Vol. 2, No. 2, 2008

Abstract: The manufacturing industry is in a state of flux, with an increasing need to be flexible, agile and lean. Organisations are unable to achieve the triple objectives, as the interventions to achieve one contradicts the need of the other. The outsourcing of the segments of chain activities can emerge as a key to achieve the desired flexible, agile and lean chains. The industry has accepted that by outsourcing activities, organisations deliver better value to the customer. This research article studies the characteristics of flexible, agile and lean chains and establishes, by factor analysis, that outsourcing can be an intervention to achieve the triple objectives of flexibility, agility and leanness. It also identifies the variables for effective value chain outsourcing and by using Interpretive Structural Modelling (ISM), it establishes a relational hierarchy among these variables. This structural analysis draws the interventional roadmap to facilitate value chain outsourcing. This article further explains the application of this process in drawing the outsourcing roadmap of a global petrochemical firm. The article is a blend of theoretical framework and practical application.

Online publication date: Fri, 28-Mar-2008

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