Manufacturing Technology Outsourcing (Review Report)

In order to cut costs, manufacturers are re-focusing on their core competency production. To do this, many are outsourcing non-critical processes to service providers in the hopes of gaining greater overall efficiency with a lower cost base. This review report combines Datamonitor's research into the outsourcing theme.

• Looks at manufacturers' views towards changing their outsourcing strategies.
• Covers PLM and BPO as solutions to help manufacturers with their outsourcing strategies.
• Sizes the market for BPO services in five countries from 2002 till 2008.

Outsourcing within the manufacturing industry is a hot topic within multiple different industries. As manufacturers look to cut costs, outsourcing appeals to many, however there are multiple areas where they can begin. There are two core types of outsourcing manufacturers are looking at: operational and horizontal.

• Understand what intentions manufacturers have with regard to changing their outsourcing strategies.
• Assess how PLM and BPO helps manufacturers achieve their outsourcing goals.
• Identify the market opportunity for BPO services in five key countries: Italy, France, the UK, Germany and the Nordics.

DATAMONITOR VIEW

CATALYST

SUMMARY

METHODOLOGY

EXECUTIVE SUMMARY

Introduction

Outsourcing technology for manufacturers (Technology Focus)

BPO in the ... manufacturing industry (Databook)

Summary

Operational outsourcing is increasing at a steady rate as manufacturers look to specialize

Manufacturing outsourcing is still a growing market but the cost of logistics is rising

Product design is helping manufacturers bring better, safer products to market faster

Logistics has been the traditional area of operational outsourcing and remains a key industry

Horizontal BPO continues to grow, driven by customer interaction outsourcing

Human resource management is a low priority for manufacturers looking to outsource

Finance and accounting is experiencing slow growth as manufacturers continue to rely on ERP systems

Customer support is currently a 'boom' area for manufacturers after competitive differentiation

OUTSOURCING TECHNOLOGY FOR MANUFACTURERS (TECHNOLOGY FOCUS)

Summary

PLM supports manufacturers who wish to utilize operational outsourcing

Collaboration on design is a key feature of PLM

Support for the input of contract manufacturers helps maximize the outsourcing agreement

PLM helps to integrate the output from outsource design partners

Security remains a key issue, but PLM can handle it well

Manufacturers can allow outsourcers access to internal systems

An external platform provides additional security for manufacturers

PLM helps manufacturers assess the impact of an outsourcing-related problem

Metadata can automatically be associated with a specific product

Manufacturers seek to derive value from progressive BPO strategies

BPO contracts can take various forms, but normally break down into two categories

Manufacturers have the opportunity to outsource a number of different business functions

Finance and accounting helps manufacturers comply with regulation and focus on their core competency

Human resource management is one of the more popular functions to be outsourced

Manufacturers can improve their customer relationship management by outsourcing its processes

Supply chain management outsourcing is a small segment of the market, but is growing quickly

Outsourcing brings multiple benefits to manufacturers faced with increasing market and internal pressures

The market for BPO services in the manufacturing industry is continuing to grow

The worldwide market for BPO services will grow at a steady rate

The finance and accounting segment is growing, but at a decreasing rate

Human resource management is on the rise, and at an increasing rate

Customer relationship management outsourcing is the largest component of the BPO market

Supply chain management is growing at the fastest rate, but remains the smallest contributor to BPO

BPO IN THE UK MANUFACTURING INDUSTRY (DATABOOK)

Introduction

Definitions

Total BPO revenues within the UK manufacturing industry

CRM BPO revenues within the UK manufacturing industry

F&A BPO revenues within the UK manufacturing industry

HR BPO revenues within the UK manufacturing industry

KP BPO revenues within the UK manufacturing industry

P&B BPO revenues within the UK manufacturing industry

SM BPO revenues within the UK manufacturing industry

BPO IN THE NORDIC MANUFACTURING INDUSTRY (DATABOOK)

Introduction

Total BPO revenues within the Nordic manufacturing industry

CRM BPO revenues within the Nordic manufacturing industry

F&A BPO revenues within the Nordic manufacturing industry

HR BPO revenues within the Nordic manufacturing industry

KP BPO revenues within the Nordic manufacturing industry

P&B BPO revenues within the Nordic manufacturing industry

SM BPO revenues within the Nordic manufacturing industry

BPO IN THE GERMAN MANUFACTURING INDUSTRY (DATABOOK)

Introduction

Total BPO revenues within the German manufacturing industry

CRM BPO revenues within the German manufacturing industry

F&A BPO revenues within the German manufacturing industry

HR BPO revenues within the German manufacturing industry

KP BPO revenues within the German manufacturing industry

P&B BPO revenues within the German manufacturing industry

SM BPO revenues within the German manufacturing industry

BPO IN THE ITALIAN MANUFACTURING INDUSTRY (DATABOOK)

Introduction

Total BPO revenues within the Italian manufacturing industry

CRM BPO revenues within the Italian manufacturing industry

F&A BPO revenues within the Italian manufacturing industry

HR BPO revenues within the Italian manufacturing industry

KP BPO revenues within the Italian manufacturing industry

P&B BPO revenues within the Italian manufacturing industry

SM BPO revenues within the Italian manufacturing industry

BPO IN THE FRENCH MANUFACTURING INDUSTRY (DATABOOK)

Introduction

Total BPO revenues within the French manufacturing industry

CRM BPO revenues within the French manufacturing industry

F&A BPO revenues within the French manufacturing industry

HR BPO revenues within the French manufacturing industry

KP BPO revenues within the French manufacturing industry

P&B BPO revenues within the French manufacturing industry

SM BPO revenues within the French manufacturing industry

APPENDIX

Definitions

Further reading

Ask the analyst

List of Tables

Table 1: Manufacturing outsourcing intentions for the following 12 months

Table 2: Product design outsourcing intentions for the following 12 months

Table 3: Logistics outsourcing intentions for the following 12 months

Table 4: Human resource management outsourcing intentions for the following 12 months

Table 5: Accounting and finance outsourcing intentions for the following 12 months

Table 6: Customer support outsourcing intentions for the following 12 months

Table 7: The Global market for BPO services within manufacturing (2002-08)

Table 8: The Global market for finance and accounting BPO services within manufacturing (2002-08)

Table 9: The Global market for HRM BPO services within manufacturing (2002-08)

Table 10: The Global market for CRM BPO services within manufacturing (2002-08)

Table 11: The Global market for supply management BPO services within manufacturing (2002-08)

Table 12: BPO definitions

Table 13: BPO services in the UK MFG industry. 2002-08 ($m)

Table 14: CRM BPO services in the UK MFG industry. 2002-08 ($m)

Table 15: F&A BPO services in the UK MFG industry. 2002-08 ($m)

Table 16: HR BPO services in the UK MFG industry. 2002-08 ($m)

Table 17: KP BPO services in the UK MFG industry. 2002-08 ($m)

Table 18: P&B BPO services in the UK MFG industry. 2002-08 ($m)

Table 19: SM BPO services in the UK MFG industry. 2002-08 ($m)

Table 20: BPO definitions

Table 21: BPO services in the Nordic MFG industry. 2002-08 ($m)

Table 22: CRM BPO services in the Nordic MFG industry. 2002-08 ($m)

Table 23: F&A BPO services in the Nordic MFG industry. 2002-08 ($m)

Table 24: HR BPO services in the Nordic MFG industry. 2002-08 ($m)

Table 25: KP BPO services in the Nordic MFG industry. 2002-08 ($m)

Table 26: P&B BPO services in the Nordic MFG industry. 2002-08 ($m)

Table 27: SM BPO services in the Nordic MFG industry. 2002-08 ($m)

Table 28: BPO definitions

Table 29: BPO services in the German MFG industry. 2002-08 ($m)

Table 30: CRM BPO services in the German MFG industry. 2002-08 ($m)

Table 31: F&A BPO services in the German MFG industry. 2002-08 ($m)

Table 32: HR BPO services in the German MFG industry. 2002-08 ($m)

Table 33: KP BPO services in the German MFG industry. 2002-08 ($m)

Table 34: P&B BPO services in the German MFG industry. 2002-08 ($m)

Table 35: SM BPO services in the German MFG industry. 2002-08 ($m)

Table 36: BPO definitions

Table 37: BPO services in the Italian MFG industry. 2002-08 ($m)

Table 38: CRM BPO services in the Italian MFG industry. 2002-08 ($m)

Table 39: F&A BPO services in the Italian MFG industry. 2002-08 ($m)

Table 40: HR BPO services in the Italian MFG industry. 2002-08 ($m)

Table 41: KP BPO services in the Italian MFG industry. 2002-08 ($m)

Table 42: P&B BPO services in the Italian MFG industry. 2002-08 ($m)

Table 43: SM BPO services in the Italian MFG industry. 2002-08 ($m)

Table 44: BPO definitions

Table 45: BPO services in the French MFG industry. 2002-08 ($m)

Table 46: CRM BPO services in the French MFG industry. 2002-08 ($m)

Table 47: F&A BPO services in the French MFG industry. 2002-08 ($m)

Table 48: HR BPO services in the French MFG industry. 2002-08 ($m)

Table 49: KP BPO services in the French MFG industry. 2002-08 ($m)

Table 50: P&B BPO services in the French MFG industry. 2002-08 ($m)

Table 51: SM BPO services in the French MFG industry. 2002-08 ($m)

List of Figures

Figure 1: Manufacturing outsourcing intentions for the following 12 months

Figure 2: Product design outsourcing intentions for the following 12 months

Figure 3: Logistics outsourcing intentions for the following 12 months

Figure 4: Human resource management outsourcing intentions for the following 12 months

Figure 5: Accounting and finance outsourcing intentions for the following 12 months

Figure 6: Customer support outsourcing intentions for the following 12 months

Figure 7: Datamonitor's view of PLM

Figure 8: The Global market for BPO services within manufacturing (2002-08)

Figure 9: The Global market for finance and accounting BPO services within manufacturing (2002-08)

Figure 10: The Global market for HRM BPO services within manufacturing (2002-08)

Figure 11: The Global market for CRM BPO services within manufacturing (2002-08)

Figure 12: The Global market for supply management BPO services within manufacturing (2002-08)

Figure 13: BPO services in the UK MFG industry. 2002-08 ($m)

Figure 14: CRM BPO services in the UK MFG industry. 2002-08 ($m)

Figure 15: F&A BPO services in the UK MFG industry. 2002-08 ($m)

Figure 16: HR BPO services in the UK MFG industry. 2002-08 ($m)

Figure 17: KP BPO services in the UK MFG industry. 2002-08 ($m)

Figure 18: P&B BPO services in the UK MFG industry. 2002-08 ($m)

Figure 19: SM BPO services in the UK MFG industry. 2002-08 ($m)

Figure 20: BPO services in the Nordic MFG industry. 2002-08 ($m)

Figure 21: CRM BPO services in the Nordic MFG industry. 2002-08 ($m)

Figure 22: F&A BPO services in the Nordic MFG industry. 2002-08 ($m)

Figure 23: HR BPO services in the Nordic MFG industry. 2002-08 ($m)

Figure 24: KP BPO services in the Nordic MFG industry. 2002-08 ($m)

Figure 25: P&B BPO services in the Nordic MFG industry. 2002-08 ($m)

Figure 26: SM BPO services in the Nordic MFG industry. 2002-08 ($m)

Figure 27: BPO services in the German MFG industry. 2002-08 ($m)

Figure 28: CRM BPO services in the German MFG industry. 2002-08 ($m)

Figure 29: F&A BPO services in the German MFG industry. 2002-08 ($m)

Figure 30: HR BPO services in the German MFG industry. 2002-08 ($m)

Figure 31: KP BPO services in the German MFG industry. 2002-08 ($m)

Figure 32: P&B BPO services in the German MFG industry. 2002-08 ($m)

Figure 33: SM BPO services in the German MFG industry. 2002-08 ($m)

Figure 34: BPO services in the Italian MFG industry. 2002-08 ($m)

Figure 35: CRM BPO services in the Italian MFG industry. 2002-08 ($m)

Figure 36: F&A BPO services in the Italian MFG industry. 2002-08 ($m)

Figure 37: HR BPO services in the Italian MFG industry. 2002-08 ($m)

Figure 38: KP BPO services in the Italian MFG industry. 2002-08 ($m)

Figure 39: P&B BPO services in the Italian MFG industry. 2002-08 ($m)

Figure 40: SM BPO services in the Italian MFG industry. 2002-08 ($m)

Figure 41: BPO services in the French MFG industry. 2002-08 ($m)

Figure 42: CRM BPO services in the French MFG industry. 2002-08 ($m)

Figure 43: F&A BPO services in the French MFG industry. 2002-08 ($m)

Figure 44: HR BPO services in the French MFG industry. 2002-08 ($m)

Figure 45: KP BPO services in the French MFG industry. 2002-08 ($m)

Figure 46: P&B BPO services in the French MFG industry. 2002-08 ($m)

Figure 47: SM BPO services in the French MFG industry. 2002-08 ($m)