Research On The Decision For Production Outsourcing Of Suzhou Schindler

With the accelerated process of economic globalization and competition globalization, for the purpose of keeping or strengthening the competitive power, more and more modern manufacturing enterprises have taken the method of production outsourcing to achieve the cost reduction and improve the core competence. However, production outsourcing is not a fashionable follow suit. A successful production outsourcing is restricted by many factors. The decision-making of production outsourcing involves following factors which are enterprise’s overall strategy, the nature of the production, the supplier selection and the management of the outsourcing process.This paper takes Suzhou Schindler Elevator Company as an example. It studies its decision model for the decision-making of production outsourcing and the application of this model in the decision-making of production outsourcing and management. This model includes four categories of factors. Firstly, the enterprise’s decision-making of production outsourcing must be consistent with its overall strategy. Secondly, the enterprise has to choose the right outsourcing objects based on the enterprise’s production business. Thirdly, the selection of the outsourcing supplier needs comprehensive consideration on the service level of the supplier, but not to blindly emphasis on price factor. Fourthly, to consider the information asymmetry, the enterprise’s cultural and ideas differences, the enterprise must establish the effective communication mechanism and strengthen the management of the outsourcing process. This paper applies the Analytic Hierarchy Process (AHP) to construct a decision model which is involved above four categories of factors. It also carries on the simulation analysis of the outsourcing decision of Suzhou Schindler Elevator Company and obtains the result of the outsourcing decision based on the simulation analysis.The study of this paper provides the basis for the outsourcing decision of Suzhou Schindler Elevator Company. Meanwhile, this outcome also provides a good example and reference for the theories of outsourcing and similar enterprise’s outsourcing decision.