Flexibility, or resilience, is an organization’s capacity to continue generating economic profit through cyclical and structural changes in supply and demand — changes like a pandemic, yes, but also any of the thousands of other sources of potential turbulence. What can you do to build a more resilient business?
Many companies have found that choosing to work with the right outsourcing partner is a powerful way to increase the flexibility of their operations. Teaming with an experienced managed services provider can help contain costs, streamline your operations, and provide access to specialized expertise. All this can free up time and internal resources that can be directed to enhancing core business activities — but only if you can maximize this partnership. Here are three key tactics for effectively working with a managed services partner to achieve these advantages and ensure that your enterprise is more resilient and better prepared for the future.
Launch a business process assessment to compare actual performance to potential optimal performance.
Developing optimal processes is essential for a resilient business. Many organizations fall short of maximizing their partnerships with managed service providers by failing to properly assess the efficacy of their processes, so they aren’t able to target the right issues in outsourcing.
In today’s business environment, no process exists in a vacuum — but often, processes are evaluated as if they do. Rapid digitization has increased the interconnectivity and complexity of organizations. This scaling of complexity means that poor performance or vulnerability in one process can ripple across the enterprise. Furthermore, the impact of these ripples is amplified during times of volatility and uncertainty — the very conditions that truly resilient business is built to navigate.
An honest appraisal of your process performance requires a holistic approach that accounts for interdependence and complexity. One effective approach is to map your processes so you can analyze the inputs, resources, links and feedback loops among them. This can help you identify gaps in optimization. It also allows your managed services partner to build a similarly holistic solution that accounts for complexity. Process assessment maximizes opportunities to automate, dedicate the right combination of onshore and offshore resources, and leverage robust business insights for continuous improvement. Optimized processes reduce the impact of sudden change, and that’s the hallmark of flexibility.
Mitigate risk with a solid business continuity plan that helps your business maintain usual operations in the face of unexpected disaster.
The events of 2020 have reminded every business that, when it comes to the unpredictable, it’s a matter of “when” and not “if.” Successful organizations understand the need for a strong business continuity plan, but traditionally these plans have only treated the symptoms of unexpected events.
In resilient organizations, however, adaptability in the face of disaster is a core competency that is developed long before disaster strikes. Genuine resilience ingrains continuity planning into business operations so you can better absorb chaos, rather than taking a “break in case of emergency” approach.
Your outsourcing partner plays a vital role in ensuring that your continuity plan is resilient rather than reactive. The previous tactic showed how optimized processes give your organization operational clarity, which means your plan can address a broader spectrum of risk. But a managed services partner can also help you identify and correct workforce challenges, provide comprehensive information governance to expand your emergency response options, and support critical back-office operations. By coordinating your continuity planning with your managed services provider, you can put resilience to work as your first line of defense, not your last.
Build greater flexibility into your supply chain, particularly in warehouse and distribution processes.
Volatility is often most acutely felt in the supply chain, where dramatic changes to market conditions are magnified at every link. Again, the pandemic provides a clear example of cascading disruption. With many stores and offices forced to close for quarantine, consumer behavior shifted online. This sudden, rapid expansion of the digital economy put tremendous strains on warehouses and distribution centers attempting to keep up with increasing demand while often being cut off from critical supply.
A holistic approach to resilience can’t eliminate these disruptions, but it does provide a road map to maximize flexibility in your warehouses and distribution networks. With the complexity of today’s supply chains, many organizations are turning to experienced third-party experts to help them build in that flexibility. A good outsourcing partner can support this flexibility in two key areas:
- Rightsizing your workforce — During times of unexpected fluctuation, your partner can provide insights to help you rebalance the size of your teams to match demand so you can optimize workload per employee, help control overtime costs and provide targeted training.
- Reevaluating inventory levels and facility design — An experienced managed service provider can help you tighten controls around inventory management to reduce overhead and increase the accuracy of forecasting. They can also help you create a careful assessment of your facilities to reduces pack times and utility spend and increase storage density.
Resilient organizations are better equipped to respond, recover, and even thrive in the face of accelerated volatility. Such organizations account for increasing complexity and turn adaptability into a core competency by focusing on the full spectrum of business fundamentals. They also don’t tackle uncertainty alone. Building strong fundamentals in concert with the right managed services partner is part of a holistic approach that is critical to true resilience.