What is outsourcing in supply chain management?
SCM outsourcing the entire supply chain management activity of an organisation to an external organisation that specializes in the same. Outsourcing the supply chain management helps in minimizing overall cost, focus on its core competencies, meet customer demands more effectively and avail greater flexibility in maintaining and operating its supply chain. While outsourcing the SCM activities, organisations take care of integration issues that they might face, when an external organisation manages the supply chain, which is the backbone of the organisation. If integration phase is taken care of and the third party organisation has expertise and prior experience in managing the supply chain of other organisations, SCM can provide strategic advantage to an organisation.