'Functions such as distribution, marketing and manufacture will be outsourced to firms with specialist capabilities.'
The primary benefits or motivation for offshore sourcing include opportunities for cost reduction, increased exposure to worldwide product technology, increased exposure to worldwide process technology and the introduction of competition to the domestic supply base. The ability to obtain quality improvements through worldwide sourcing is not currently a highly rated benefit. ('Executive Summary of Purchasing and Supply Management', CAPS, 1996)
will become increasingly important. E-business is an important enabler of this innovation and will continue the drive towards global sourcing. Faster worldwide communications reduce the costs of working with partners far away. However, the costs of transporting goods and the challenge of working across cultures will remain, encouraging organisations that function globally to source in the regions in which they operate. It is beyond the scope of this report to evaluate political restraints on globalisation. Over the period considered by the study it seems unlikely that all such restraints will disappear. They will continue to be part of the environment that global procurement and relationship managers must understand and in which they must operate, as previously explained in Open global supply.
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