Boston Consulting Group on China Sourcing

5 comments October 23rd, 2007 David Bush - Iasta

Boston Consulting Group, a highly respected consultancy, has released a new publication named Sourcing From China - Lessons from the Learners. It is another one of these reports that I have come across recently which is a digestible size and easily read. I recommend downloading and saving, if your organization does any offshoring or plans to. Understanding the risks versus the rewards is the first thing that should be done before proceeding. It can be wildly successful, or implode spectacularly. Or, more likely, it will be somewhere in between, and require more than you ever anticipated.

Of interest to me, was an exhibit which describes the four stages of successful China Sourcing. These follow as Stage 1: Test the waters; Stage 2: Early Engagement; Stage 3: Full Integration; Stage 4: Make China a Center. A larger version of the image is available below.

BCG also identified ten recommended best practices (nice, convenient round number) which they go into great detail on each. At the high level three listed that I found helpful and interesting were:

• Define a clear sourcing strategy with specific targets and plans
• Align the China Sourcing Organization with Global Procurement
• Gain 100% transparency into Sourcing volumes and savings

Its a good report and worth saving for reference.

Entry Filed under: Analysts/Research, Global Supply Issues/Risk, Suppliers