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Industry Background

In the early 1990’s outsourcing was traditionally restricted to basic support activities. Sourcing areas such as IT, Telecommunications, Fulfillment, Sales and Marketing Services were not common practice. 

In the late 1990’s companies realized the need to focus on their core competencies and maximize their internal expertise and resources to improve productivity and profitability. They began to recognize outsourcing as a powerful tool to cut costs, improve performance in areas such as IT, Manufacturing and all types of Marketing Services.

Up until that time, sourcing marketing services in particular were not common place or part of an organizations approach to gaining trial, awareness and pull through at the direct to consumer or business to business levels.  Marketing services were handled by the Ad Agencies and internal marketing and sales management.

During that time, it was clear outsourcing was advancing into the sales and marketing services arena and becoming a critical part of a company’s brand strategy.

Outsourced providers were establishing themselves in areas such as field marketing, promotion, merchandising, sales, fulfillment, auditing, etc. to meet the emerging market needs. Many of these groups were and still are outstanding and industry leaders.

With the growth of these outsource service providers however came virtual companies and/or “Multi-layer” Groups. They presented themselves as experts in channels where they have limited knowledge, service capabilities or were “seamlessly” sourcing services themselves without the client’s knowledge. The results included over promising, under delivering expectations, negative brand impression and poor management of programs. 

While the decision to outsource initiatives were compelling, in the early stages of outsourcing companies were realizing that this decision was not meeting management's expectations for many reasons as stated above as well as:

  • Limited knowledge base or background to make informed decisions on their outsourced solutions.
  • Limited time devoted to fully understanding organizations fully loaded costs associated with internal and outsourced services.
  • Outsourcing services that did not provide profitable value to the organization.
  • Outsourcing to vendors that did not meet organizations needs.
  • Rush to contract decisions resulting in poorly written contracts.
  • Limited integration of internal and outsourced personnel.
  • Poor Management of outsourced vendors.
  • No understanding of the fully loaded cost of internal versus outsourced services.

These were among many of the reasons ARS was formed with the Mission to work as an extension of our client’s management team to create and/or implement programs that are customized to meet their specific needs.

 

 


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