OUTSOURCING OCTOBER 2019
PLAYING
THE GAME OF RISK
We are currently living in what
Why strategic outsourcing o ers the perfect antidote to risk and the
uncertain times manufacturers are increasingly facing
BY TONY HAGUE, CEO, PP CONTROL & AUTOMATION
many media commentators are
calling ‘unprecedented times’.
It’s diffi cult to argue with that
notion, especially when it feels
like uncertainty is growing with
every passing day.
In fact, if you look at the global economic
landscape there is a toxic cocktail of events
clearly developing. Trump’s well publicised US
trade war with China promises to suck the rest
of us into a potential slowdown whilst, closer
to home, we have the shambles that goes by the
name of Brexit.
Just when you think politicians couldn’t
cause further issues along comes another bill or
another amendment. Even staunch ‘Remainers’
from the business community are sick of the
limbo we currently fi nd ourselves in.
This uncertainty is certainly transmitting
itself into the world of manufacturing, with
August’s PMI fi gures of 47.4 the lowest in seven
years. And it’s not just the automotive sector that
is struggling. We have seen small signs across
many of the sectors we supply that confi dence
isn’t what it used to be, and that new projects and
associated investment are being put on hold.
With all this in mind, it is no surprise that an
increasing number of companies are looking to
Manufacturers are looking
carefully at how they balance
short-term term pain with
the medium and longer-term
picture and how they juggle
maintaining capacity and
inventory whilst protecting
their cash.
If companies react to the
uncertainty by cutting too deep,
too soon it can remove their
ability to respond when things
begin to pick up and leaves
them unable to meet existing or
new customer demand.
Placing this risk with a
strategic outsourcing partner is
a viable way of avoiding ‘Russian
roulette’ when it comes to the
future of your business.
We currently work with
over 25 world class companies
on this basis, spanning over 12
diff erent markets. Together, we
have developed relationships
that allows our clients to focus
on their core competencies,
leaving PP Control &
Automation to take care of noncore
mitigate their risk and choosing to use strategic
outsourcing as a way of achieving that.
core manufacturing processes.
PP Control &
Automation CEO
Tony Hague
The customer benefi ts
from reduced operating
costs, the elimination of
unnecessary stock and
reduction in work in progress
and, importantly, improved
manufacturing lead times.
They also gain immediate
‘agility’ with the ability to
reduce and increase volumes
at the press of a button – ideal
in the current climate of
economic uncertainty.
Now, imagine if they didn’t
have an outsourcing partner?
If sales increased rapidly
they would have to invest in
new machines/buildings or
costly sub-contract labour to
cope with the peaks. When
times are tough and volumes
drop, this could well turn
into redundancies and capital
equipment lying idle.
In our world, there are
few costs for the customer
to pick up when establishing
a strategic outsourcing
partnership. In fact, once an
agreement is in place, we will
take on the majority of the
up-front costs, investing time
and money into production
engineering, setting-up test
jigs/rigs and, if requested,
taking on supply-chain
management.
Keep your
suppliers closer
Whether it’s the possible
ramifi cation of a no deal
Brexit having an impact or
not, there is no getting away
from the fact that a lot of UK
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