Question 8-17 Hammaker Manufacturing Ii (Business Process Reengineering or Outsource)
Hammaker Manufacturing (HMC) has had its AIS in place for the past 15 years, and is interested in reevaluating its business processes to identify any potential areas for improvement. The current system has worked well for the company so far, however with the increasing pace of modern technological advances, HMC is weighing its options between business process reengineering and the potential to outsource. Denise Charbonet, the CEO, is currently working with Lloyd Rowland, a software consultant, to evaluate the feasibility of outsourcing jobs.
Some tools that they could use to …show more content…
Producing automotive parts is a core business for HMC because the company's business is making specialty Corvette car parts. This is the process they are known for and all of the other processes in the company's operations support the goal of making parts for customers. HMC's success depends not only on how well each department performs its work, but also on how well it manages to coordinate departmental activities to conduct the core business process (http://en.wikipedia.org/wiki/Core_business), which for HCM is producing automotive parts. It is necessary for all the departments to be focused on the overall, "core" business process in order for HCM to be successful.
4. Do companies outsource "core" business processes? Search the Internet to see if you can find an example of a company or industry that outsources core business processes. What are they? Why are they doing this?
Although it is often more common for companies to outsource secondary business processes, some companies do choose to outsource their core competencies. In some cases, outsourcing a process to another company can result if the other company has more scale or expertise in a particular area. For example, Nike is the largest supplier of athletic sneakers in the world and it outsources 100% of its production. This enables Nike to focus on research and development before the shoes are manufactured and then on