Could This be the Future of Outsourcing?
© BOMBMAN
I don't usually quote press releases – they tend to be speculative, at best, and over-hyped, at worst. However, the process offered here is interesting – not so much for its actual presence in the market, but because of the underlying concept of reverse project auctions.
I have long thought that outsourcing projects could be susceptible to reverse auctions. In commodity-level sourcing, a project can be positioned in the marketplace and prospective bidders can bid price, quality and turnaround. A customer could choose the best bid, send the work out and receive turnaround in a very price-efficient manner.
Even in higher-order outsourcing, this approach could work. If a company maintains a multi-supplier environment – where each is familiar with the baseline requirements – projects can be opened for formal bid by each supplier and select the one that offers the best price and terms.
There are some real potential benefits for both suppliers and customers. First, customers could take comfort in the fact that they're getting the best price for their requirements. Suppliers, too, can bid to fill gaps, for example, turning previously underutilized bench time into a revenue generator.
Unfortunately, this approach does wreak havoc on relationship-oriented suppliers – it is unlikely that the relationship will be well factored into the auction. Still, as a way to ensure best-price sourcing, it may have promise. Stay tuned!
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@Gary
I absolutely agree with you on ths point. With the trend in the market it’s really a possibility that outsourcing gains such a form. I work for one such company which is already doing this for the clients looking for IT needs. Check out yourself
http://www.usourceit.com
Comment by Sonal Maheshwari on June 16, 2009 11:37 pm
Great article! But I think this is already happening in terms of search engine search. The first ten outsourcing company sites on Google are impliedly on auctions. The best title and snippet matching the keyword/s search used gets to be clicked first. The marketing strategies set on the website per se will play a very significant role to capture the interest to eventually lead to an online/phone inquiry.
Comment by Business Process Outsourcing on June 19, 2009 1:45 am
Precisely, today’s outsourcing trends is that outsourcing companies with terrific marketing strategies will prosper…right? just like us!
Comment by Philippines Outsource on July 17, 2009 4:58 am
hi i found this great tutorial while im surfing the net they are giving up a free minicourse on how to become successful in out sourcing thank for this article also this is a great article. if anyone is interested here is the url of the site that im talking about the strategies of outsourcing http://virtualadministrativeassistant.info/minicourse/index.html
Comment by SARAH on July 20, 2009 10:17 am