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Everest Research Institute: Third-Party Outsourcing Suppliers Can Provide 5-15 Percent More Savings Than Captives; Best-in-Class Captives Can Match Third-Party Performance.



Third-party vs. Captive captive

said of naturally wild or feral animals kept in captivity for educational and scientific investigation with no attempt being made to domesticate them.
 Study Advises Value Evaluation More Important than Costs

DALLAS -- Third-parties outsourcing (1) Contracting with outside consultants, software houses or service bureaus to perform systems analysis, programming and datacenter operations. Contrast with insourcing. See netsourcing, ASP, SSP and facilities management.  suppliers are typically 5-15 percent less expensive than captives in terms of their total cost of operations, according to according to
prep.
1. As stated or indicated by; on the authority of: according to historians.

2. In keeping with: according to instructions.

3.
 a recent study by the Everest Research Institute. The study makes a holistic Holistic
A practice of medicine that focuses on the whole patient, and addresses the social, emotional, and spiritual needs of a patient as well as their physical treatment.

Mentioned in: Aromatherapy, Stress Reduction, Traditional Chinese Medicine
 comparison of costs across operating costs operating costs nplgastos mpl operacionales , productivity, transition, sales and marketing and margins. The cost advantage of the third-party model is derived primarily from better leverage of scale, leaner operating environments In computing, an operating environment is the environment in which users run programs, whether in a command line interface, such as in MS-DOS or the Unix shell, or in a graphical user interface, such as in the Macintosh operating system. , more complex overhead management associated with most captives, as well as higher investments that captives make in knowledge transfer during offshore migration and creation of a more global culture. However, best-in-class captives are observed to operate at similar and even lower costs.

Although cost reduction is important, the study, Comparison of Outsourced and Captive Solutions for Capturing Value from Outsourcing, advises that a company's decision of which model to leverage must be aligned with its near- and long-term strategic goals. The Institute will also host a Webinar on October 11 at 8 a.m. CDT CDT
abbr.
Central Daylight Time


CDT Central Daylight Time

CDT n abbr (US) (= Central Daylight Time) → hora de verano del centro;
(BRIT
, to provide multiple viewpoints on the third-party and captive offshore divide.

"Many of the factors that drive up the near-term captive operating cost structure can be valuable investments in the long-term to create business and strategic impact," said Nikhil Rajpal, Vice President of Global Sourcing for Everest Research Institute. "To capture the value associated with the captive model requires an investment of effort and finances, and the company moving the work offshore as a captive operation must maintain focus on cost-reduction opportunities where relevant."

According to the study, the third-party model can be better suited for companies who value goals such as minimizing location risk, attracting scarce talent that is not core to the business, and scaling costs to match demand for processes with fluctuations in volume. Conversely con·verse 1  
intr.v. con·versed, con·vers·ing, con·vers·es
1. To engage in a spoken exchange of thoughts, ideas, or feelings; talk. See Synonyms at speak.

2.
, the captive model can further goals such as to gain access to new geographic markets, increase access to management talent, achieve end-to-end control, and enable greater integration with the parent company.

"A company must identify the model that works best for its specific objectives and situation," said Eric Simonson, Managing Principal of the Everest Research Institute. "It is becoming increasingly clear that the third-party and captive models are differentiating themselves and should be compared based upon their unique attributes. There are unique types of value that the third- party and captive models are better suited to capture that can help a company better reach its strategic goals and, in many cases, a combination of both models is the optimal solution."

This report builds on to the results of a recent Everest study, Captive Value Diagnostic Study Market Update, which surveyed over 100 key executives who operate captives across global companies. The survey revealed that more than 85 percent of these executives believe that their captive operations are delivering on cost savings and service expectations, despite contrary opinions.

The Webinar will take place on October 11, 2007, at 8 a.m. CDT; 1300 GMT (Greenwich Mean Time) See UTC.

GMT - Universal Time 1
; 6:30 p.m. IST. To register, please visit: www.everestgrp.com/Webinars.

To read more about the results of the captive studies, an extract of both reports are available at www.outsourcing-center.com. To purchase the reports or receive more information about other research services, please e-mail info@everestresearchinstitute.com or call +1-214-451-3110.

About Everest Research Institute

Everest Research Institute (www.everestresearchinstitute.com) serves as a central source of independent and objective strategic intelligence, analysis, and actionable Giving sufficient legal grounds for a lawsuit; giving rise to a Cause of Action.

An act, event, or occurrence is said to be actionable when there are legal grounds for basing a lawsuit on it.
 insight for leading corporations, service providers, and investors in the global outsourcing and offshoring
Offshore may refer to oil and natural gas production at sea; see oil platform.


Offshoring describes the relocation of business processes from one country to another.
 marketplace. The Institute addresses both business process and information technology sourcing topics, providing the global outsourcing and offshoring community with information that empowers highly productive, sustainable sourcing strategies and relationships. The Institute's distinguished Board of Advisors, senior executives and thought leaders oversee the Institute's research agenda to ensure that it fully supports the business needs of corporations, service providers and investors.

Everest Research Institute members receive access to unparalleled analytical and advisory services advisory services

advisory services provided to the public, in their capacity as owners and managers of animals, are an important part of veterinary science. They may be provided by government bureaux, by commercial companies who deal in pharmaceuticals or animals or animal
, including access to Everest analysts, in-depth reports on major outsourcing and offshoring topics, white papers on market-shaping events, and Webinars designed to provide insight and information about important market trends. The Institute's wealth of knowledge and experience provides members with unique perspectives into today's marketplace and the competitive edge required to take advantage of emerging opportunities.

Everest Group is a global operational strategy consulting firm Noun 1. consulting firm - a firm of experts providing professional advice to an organization for a fee
consulting company

business firm, firm, house - the members of a business organization that owns or operates one or more establishments; "he worked for a
 with offices in such leading business centers as Dallas; Gurgaon, India; London; New York New York, state, United States
New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of
; Toronto and Melbourne. An industry leader since 1991 when we created the sourcing consulting category, Everest Group has earned a worldwide reputation for ongoing innovation as we help clients achieve maximum value from their operations, which includes sourcing strategy and implementation. Everest created the Everest Research Institute (www.everestresearchinstitute.com) as the central source of industry information. Please visit www.everestgrp.com and www.everestresearchinstitute.com for more information.
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Date:Oct 2, 2007
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