Tag Archives: Outsoucing

Dyson Car to ‘hoover up’ competition……#innovation

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Dyson-carSir James Dyson has revealed what many automotive industry insiders already knew by rumour – his company is developing an Electric car ! The fact that Dyson have no automotive precedence or manufacturing facility should not be seen as a show stopper – there is plenty of subcontract capacity available (at a price) although his timescale of 2 years to volume manufacture is probably over ambitious.

Many current Automotive specialists will laugh at the idea of Dyson moving into this arena with its complex & demanding legislative requirements but perhaps that is missing the point.

Dyson recently bought innovative Solid State battery development company Sakti3 for $90 million & half of Dysons $2.7 billion will be spent on battery development.

The batteries developed by Sakti3 are Solid State which offer much higher energy densities & battery life than current Lithium Ion batteries.

Perhaps the likely scenario is that Dyson will use his Electric car to showcase the real diamond in the rough – a vastly superior battery technology which will then be licensed to the main automotive players enabling the Wiltshire Innovator to truly ‘clean up’

chris@amberhill.biz

www.amberhillassociates.com

Globalisation is Good………………………………..#innovation

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design-processMuch has been said about the ‘evils’ of Globalisation & the impact on impoverished workers resulting in Brexit in the U.K & Trumps victory over the pond. But what about the positive impacts of Globalisation which are rarely trumpeted (excuse the pun)

The export of manufacturing jobs from the West to Asia has undoubtedly impacted on job security in the West but what about the subsequent cost reduction in the price of consumer products.

Also, hundreds of millions of people have been lifted out of poverty in China & Asia as a result.

Those very same products are bought by the same people who moan about foreigners stealing their jobs. A TV which can be bought for £200 in a UK supermarket would cost may times that if manufactured in the UK.

Protectionism is no answer to under employment. All that will happen is the Countries affected by Tariffs will introduce their own in ‘revenge’, take the auto industry as an example.

Every car manufactured in the U.S contains hundreds of components which are made abroad. If each of these components increases in costs the unit cost of the car goes up reducing competitive advantage & ultimately the business is bankrupt.

In the end everyone loses as bureaucracy strangles innovation & the economy shrinks.

The only way to ‘protect’ jobs is by investing in education & innovation. By producing individuals who can develop & create the products & services of the future. These will be made wherever it is cheapest to do so lifting the impoverished up the socio economic ladder & increasing their own economic power.

In the UK manufacturing is only 10% of the economy but we have some of the worlds best design & development Engineers earning good salaries creating innovative products even if they are manufactured overseas.

Apple is recognised as one of the Worlds most successful & innovative corporations employing thousands in well paying jobs – but not a single iPhone is made in the USA.

‘Putting America first’ may give short term gains but will ultimately end in disaster.

chris@amberhill-associates.com

www.amberhill-associates.com

 

Start your own #consultancy #business from scratch..

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So you really want to start your own Consultancy business from scratch !?

ppt1Here are some tips I hope will help:-

  • Identify your key skills – if you want to sell yourself as a Consultant the first thing you need to identify is the skills you possess which people will be willing to pay for. If you can’t do this don’t give up your day job.
  • Develop a Business Plan – don’t put it off because you can’t be bothered or don’t think it’s necessary. If you want people to take you seriously as a Business you need to start thinking like a Business.
  • Identify your target market – who are you going to sell your skills to ? – your current or former employer perhaps ? Former customers or suppliers, ex colleagues, business partners etc etc
  • Network – Develop your contacts, LinkedIn is great for this but don’t forget about your address book & business card collection.
  • Have a look at the Professional Contractors Group website www.pcg.org.uk – it has a fantastic free downloadable guide for freelancers/consultants.
  • If you still want to take the plunge this is perhaps the hardest step of all – You will need a MINIMUM of 6 months income in the bank before you start. Do not plan to earn anything from your Consultancy business for the first six months. If you really want to succeed with your own Consultancy business you will find this money. If you see this as too big a hurdle then sorry but Consultancy is not for you.

Look out for my new book “Start your own Consultancy – Now!”

chris@amberhill-associates.com

www.amberhill-associates.com

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Happy National Freelancer Day #NFD2014

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Today is National Freelancer Day in the U.K (apparently) So what’s it like to be a ‘Freelancer’ in 2014 ?                                                                                                                          FreelancerSpeaking purely from personal experience I have been freelancing for over 5 years so here are my findings:-

Employment – Since leaving ‘permanent’ employment I have never been out of work & have moved fairly seamlessly from one contract to another. I am in Engineering so this may not be so easy in other professions. It also requires a degree of forward planning, I generally start ‘sniffing around’ 2 months from the end of my current contract. You also need to develop an extensive network of contacts & I have found ‘Linked In’ invaluable for this.

Earnings – This is what interests people the most about Contract work. In Engineering earnings are typically 20-30% higher than prermie’ earnings BUT it has to be remembered this doesn’t include holiday or sick pay, pension contributions, bonus etc etc. So if you are regularly sick & enjoy extensive holidays your probably better off as a ‘permie’

Tax – As a contractor you pay less tax. This is because you can set yourself up as a Limited Company & pay yourself minimum wage & the rest in Dividends which are taxable at the Corporation Tax rate which is lower that what you would pay as an individual. You can also deduct legitimate expenses from your taxable income. You can also take advantage of the Flat rate VAT scheme where you collect 20% & pay HMRC 13% of total earnings, keeping the difference. All of this is perfectly Legal & proper but do seek the advice of a qualified Accountant.

Be your own Boss – Sounds great but you always have to remember you also have a Client who is effectively paying your salary & you will have to report to someone.

All in all I have never looked back & intend remaining as a Contractor for the rest of my career. If you are considering this career option I wish you a Happy Freelancer Day & good luck.

chris@amberhill.biz

www.amberhill.biz



#Insource is the new #Outsource

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workersA recent report from Deloitte suggests that bringing jobs back in house (Insourcing) is a small but growing trend against the much larger tendency to Outsource which has dominated western industry for the last thirty years.

Companies are increasingly realizing that Outsourcing is no longer the best value option. Anyone who has been involved in Outsourcing knows it is never as simple as it’s made out, often requiring intensive effort from Managerial & Engineering staff & extensive, frequent travel. Not to mention increased wage costs in China & India, increased shipping costs and numerous supply chain delays.

The biggest issue Western companies face with Insourcing is the lack of trained, skilled staff to deliver the service. Having made thousands of workers redundant in the pursuit of cheaper Outsource options this is somewhat ironic.

This need may be met by making good use of the highly skilled Freelance professionals who operate in the market to satisfy just such demand.
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10 tips to ensure project delivery….#pmot #in

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On target delivery

On target delivery

As Project Managers our business is project delivery. However some external suppliers are more reliable than others so here are 10 tips to ensure success:-

1) At the first sign of trouble arrange to have a face to face meeting with your supplier. It doesn’t matter if they are on the other side of the world, clear a space in the diary, book the flights and get in front of them. It will be worth every penny.

2) Raise your concerns in an open, honest none aggressive manner. By all means express your irritation but don’t blow your top – you will make yourself look foolish and unprofessional.

3) Identify the key stakeholders within your own organization who share an interest in the project.

4) Identify the key stakeholders in the supplier organization who share an interest in delivering the project.

5) Break the task down into manageable chunks and identify responsibility for each sub-task.

6) Insist the supplier provide a daily report of activity to be delivered at a specific time. This report should include a simple graphical representation (such as a bullseye chart) to indicate days ahead or days behind schedule. It should also stipulate actions required and responsibility. This report should be circulated to all key stakeholders. Accept no excuses for late or none delivery of this key report.

7) Following the face-to-face have a daily conference call. Do this whether there are any issues or not. 2 minutes passing the time of day reminds the supplier they are uppermost in your mind.

8) Identify Carrots and Sticks. What penalty clauses can you invoke ?  What are the opportunities of new business ?  Identifying them gives you additional leverage.

9) Make it easy for them – have they got a spec, is it up to date, is it comprehensive enough, do they understand exactly what is required ?

10) Don’t assume everything is the fault of the supplier, have you communicated clearly and concisely what your expectations are ?  Have you paid each milestone on time ? Is the SOW & Contract clear ?

Some suppliers are always easier to deal with than others but employing the above tips should help. Have you got any more you could share ?

chris@projectsguru.co.uk

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Insource or Outsource ? #pmot #in

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Far East manufacture should not be the default option

Far East manufacture should not be the default option

Over the last 14 years Manufacturing in the U.K has shrunk from a respectable 28% of GDP to today’s all time low of 10%.

So maybe it is time to rethink our outsourcing strategy ?

Over the years we have become very complacent in the U.K about manufacturing, and in many respects have given up the ghost. We have blithely subcontracted all of our manufacturing operations with no long term view of the consequesnces. We have given away millions of jobs for a short term monetary gain and are now reaping the rewards of an economy built on sand.

Outsourcing to the Far East should NOT be the default option. We need to look at the alternatives and take the following into consideration:-

1) Compare Apples with Apples – just because the Direct labour Cost may be cheaper in the Far East what about the support costs. It is inevitable that a subcontracted operation will need more indirect suppport, sometimes more than you could possibly imagine, and this cost needs to be accounted for somewhere.

2) Is the Quality of the product really going to be the same ?- how will you ensure this ?

3) Cost of shipping – with rising fuel costs have you taken this into consideration ? you need to understand the cost per unit shipped.

4) Environmental Policy – How does the transport and distribution of products across the world fit in with your Environmental Policy – if you want customers to “buy in” to your Environmental Policy it needs to be credible and any offshore manufacture and transport should be accounted for in your overall Carbon Footprint.

5) Time of shipping – can you afford to delay initial deliveries while they are on the Sea for 5 weeks or do you want to pay extra for air freight to ensure fast delivery ?

6) Have you considered the cost of Import Duties ?

Consider the success of some of our best industries in the U.K – auto manufacture, Aerospace, telecommunications, mobile phones etc etc

Outsourcing should remain a key component of our manufacturing strategy but should note be the default option. We need to challenge the assumption that manufacturing will be subcontracted by asking the right questions.

chris@projectsguru.co.uk

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Stop trade with China Now ?

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Today’s news that the Chinese dissident Liu Xiaobo has been awarded the prestigious Nobel Peace Price for his peaceful resistance to Chinese oppresion and work for Human rights has raised the heat on the debate – “Should we stop trade with China now ?”

Most people are aware that the vast majority of Western companies outsource manufacturing operations to China for cost reasons and perhaps it is time we began to seriously question this strategy. Have a look at any company’s website and you will find a description of the company’s environmental policy but you will be hard pressed to find any information about the company’s attitude towards democracy or human rights.  If we are so concerned about Global Warming and it’s impact on the planet perhaps we should also be paying more attention to which regimes we do business with.

Of course the opposite argument is that by doing business with China we are helping to raise living standards which will inevitably lead to greater pressure for democracy and human rights.

However it would be nice to know that the debate had at least taken place and to see some kind of clear policy on company websites regarding human rights policy.

What do you think ?

Join the debate on Twitter now @projectsguru

chris@projectsguru.co.uk

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Stop corporate abuses - Amnesty International

Outsourcing at any cost ?…..

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In July 2009 Sun Danyong comitted suicide by throwing himself from his 12th flloor apartment. Sun’s apartment had been ransacked and he claimed in a text, immediately before his death, that he had been badly beaten.

Sun worked for the massive Taiwanese CEM Foxconn (Turnover |$10 billion) which manufactures Apples iconic iphone. He was rumoured to have been suspected in the theft of an iphone prototype. The incident sparked an Audit by Apple but to date no visible action has been taken.

iphoneThis incident highlights the ethical dilemmas posed in Subcontracting. How do we deal with massive corporations which often dwarf our own ?  How do we balance the need to reduce manufacturing cost with the need to deal with undemocratic regimes with questionable human rights records ?

Do we do business at any price ?

Like most dilemmas the answer lies with the consumer. Western consumers are increasingly conscious of the ethical and environmental impact of their actions, where does that food come from, what is involved in it’s manufacture ? Who benefits and who gets hurt ?

This conciousness will extend to all areas of consumption including electronic products and it is those companies which pursue an active, ethical and evironmental policy which will ultimately benefit.

chris@projectsguru.co.uk

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Outsourcing trends point to further job losses…

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SPA032The outsourcing market is a large, diversified and complex model but it is still possible to discern some notable trends:-

1) The manufacturing industry in the West looks likely to continue to shrink, according to Electronics Times the U.S semiconductor industry lost 107,000 jobs between 2001 to 2009 and some predictions estimate a further loss of 146,000 jobs from 2008 – 2018 – Scary stuff.

2) The latest Labour Market Outllook report from CIPD suggests that 10% of all UK companies intend to outsource some work in 2010 with 41% of I.T companies planning to outsource key activities.

3) According to the Bangkok Post the Outsourcing market was worth $24.9 billion at the end of Q4 2009 up 8% on the previous year.

4) An interesting observation is that Chinese & Indian companies are looking at Outsourcing within their own National boundaries. This is perfectly understandable given both countries vast size and untapped resource. We may see a gradual migration of economic activity from coastal areas inwards.

All of the above highlights the need for Western companies to accellerate Innovation to stay ahead of the value curve.

It also suggests that Western governments need to look very carefully at their strategy for Manufacturing and Innovation if they want to preserve what remains of the High Technology sector to provide skilled employment in the future.

As per usual Cash is King.

chris@projectsguru.co.uk

www.projectsguru.co.uk