1.What Practices in vendor selection, contract formulation, and outsourcing process Management and Governance would you recommend to ensure that B&B can achieve innovations in its future Outsourcing arrangements?
2.How to handle the Ownership of HRA2? Would it be exclusive to B&B or could AlphaCorp offer it to other clients? Justify your suggestion.
1.Bentley and Brooks or in short B&B is a company that produces and supplies consumer goods and household products that manage their business through distributing their products to another company named AlphaCorp who ultimately sells the products in the consumer market. B&B after facing some challenges in the recent global market has started to find some alternatives for their business outsourcing by which they can bring innovativeness in their products.
Vendor Selection is one of the chief tasks of a business house for their increase of their stocks of services and products at suitable price along with good terms and conditions of the delivery system. In order to attain success in the present business condition can take up the process of vendor selection in a fresh innovative manner. The process of selecting vendor can be carried out in simply trying and vexing method which consists of two ways- either the company can directly choose the vendors or they can let vendors give their tenders for their work (Malik, Sinha, & Blumenfeld, 2012). Now the selection of vendor requires the fulfillment of various criteria. These criteria again depend on certain analyzation of the requirements which are as follows- the types of products required by vendors for their selling, the quality of the product required demanded, the levels of stock required for selling, how frequent can the vendor deliver the products to their customers and lastly the pricing of the products asked by the vendor. The company an also approach some easy methods for choosing their vendors. It is suggested that the company must negotiate an agreement regarding the pricing of the products instead of giving them a list of the prices. This will enable the company to negotiate better levels of price with good terms. It is recommended however small a company might be, it must not show the price list to its vendors. Once the vendors agree on the terms and conditions of the distributor, the distributor must layout a master contract highlighting the pricing, delivery options, delivery times, terms and conditions of the company and the range of products and services that are negotiated earlier. This will help the company to function effectively within his selected group of vendors.
On the other hand, tendering is a complicated system of selecting vendor. It is suggested that for such small like B&B tendering process must be avoided as it will require the negotiations from both ends to satisfy the demands of both the vendor and the distributor (Baltzan, 2012). Tendering process starts with the Request for Proposal or RFP from the distributor’s end. RFP details the requirements necessary for delivery potentials and the terms and conditions of the distributor. It is recommended that while tendering first let the distributor company get the bid and then move into negotiation with the vendors. This will enable the distributor to receive a number of tenders to provide them with better quality terms and services. This is followed by evaluating each of the bids mostly undertaken in an official manner with the intention of choosing one or more new vendors. Henceforth, the vendors sign the master agreement and enter into the business contract.
Contract formulation records the term and conditions that are negotiated by the two companies. The main objective of the formulation of contract is to simplify the entire process of business. Initially, the contract formulation emphasizes on the contract negotiated between the two distributors and the vendors regarding their business management (Parthiban, Zubar, & Katakar, 2013). In this case, when negotiations were made with AlphaCorp, the company promised to provide their distributors with innovative technics in the process of selling the products, however it has become very difficult at the present situation to meet such innovative terms. Another important drawback of the contract formulation is that while signing the contract, there were provisions for cost reduction management and it was said that if those targets are met, there will be rewards. Nevertheless, this innovativeness in meeting targets are currently avoided by AlphaCorp and they are demanding funds if asked about these innovative technics in the processing of the products. The only innovativeness that has been received from AlphaCorp is the initiative taken by the company towards HRA in Western Europe. In this case of formulation of contract of B&B, it is recommended that the contracts that are related to management must flexible enough from both sides for willingness to consider the terms and requirements for the outset of the future prospect. The contract must clearly mention the outcomes if the terms are not met by the company signing the treaty (Weiss, 2014). It is proposed that B&B in their future treaties must keep some possible alternatives that are suitable for the existing contract. The treaty must mention the risks that might be related to the production.
The outsourcing process management initiative at present includes outsourcing of a wide IT infrastructure with IBM in Europe, a wide European outsourcing communications with France telecom and a few such outsourcing consultation and HR outsourcing in America.
Governance is a very important aspect of outsourcing. It enables a management to make decisions that will increase the business value that is derived from the relationships that are outsourced and at the same time reduce the risks related to it. On the contrary, outsourcing is a plan of additional document to the contract of outsourcing (Massini, & Miozzo, 2012). While B&B started outsourcing their business they came to know that they themselves are not able to understand their own business which lead to a situation that currently states that B&B is now strongly dependent on their providers of the outsourcing. Thus, it is recommended here that B&B must implement some strong governing measures to gain their foothold in the business sector.
2.The effective HRA can be managed by following a few steps. The first and foremost step is to begin a plan for the health safety of the employees from any date. The main purpose of HRA of the company is to endow information on value of cost in order to make appropriate and effective management resolutions regarding procurement, allocation, development and preservation of human resources in order to achieve the organizational effective cost benefit (Babin & Schuster, 2012). B&B in order to grow in the global market must monitor effectively the HRA management of the company. This will also help the company in the resolution of decision making and analyzing of critical issues to compete in the global financial market.
At present B&B along with the assistance of AlphaCorp manages a global HRA in Europe and America (Chon & Yu, 2012). It is likely that there are more scopes of HRA for AlphaCorp as it currently outsources B&B’s administration. It is highly recommended to B&B to manage the HRA initiatives on its own rather than giving AlphaCorp the charge for HRA outsourcing. B&B if takes the management of HRA, then it will be beneficial for the company to invest accordingly for the five factors which are recruitment of the employees, acquisition policy of the company, induction training and conducting of other formal programs for the new employees making them aware of the companies rules and regulation. The company can also experience the real scenario of the global market employment and can take initiatives accordingly which the company at present lacks due to the management of HRA by AlphaCorp.
Since the HRA process is maintained by AlphaCorp it is predictable that AlphaCorp can likely offer it to B&B as it is their main client. This will enable both the companies to grow together and compete in the world market with effectiveness.
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