Nicholas Beaumont

Outsourcing in Australia

This paper reports on data pertaining to outsourcing collected from a survey administered in 2002 in Australia. The underlying assumption was that outsourcing is becoming popular for sound business reasons such as economies of scale and enabling executives to concentrate on core business activities. This paper explores the outsourcing decision (to outsource, not to outsource, or to discontinue outsourcing), especially reasons for (not) outsourcing. Most of the reasons have been anticipated in the literature. The strongest group of reasons (termed “Operational”) pertained to cost savings and improving performance, but outsourcing is also used to access skills and resources not available in‐house. The most important impediment to outsourcing was ascertaining relevant costs, and formulating and quantifying requirements. We describe the methodology, report findings and allude to future research.

Scheduling staff using mixed integer programming

Abstract This paper describes the solution of a problem of scheduling a workforce so as to meet demand which varies markedly with the time of day and moderately with the day of week. The main objectives are determining how many staff to employ and the times at which shifts should start. The problem is expressed as a large MIP problem initially presenting computational difficulties. The difficulties vanish when the formulation is modified and a package allowing the use of reduce and (especially) special ordered sets becomes available. The client has commissioned the study primarily to benchmark its existing schedule by comparing it with a theoretical optimum. The optimal schedule and comparison are very sensitive to technical and cost coefficients which are not precisely known.

Do foreign‐owned firms manage advanced manufacturing technology better?

This paper uses regression analysis of factors obtained from measured variables to find statistical relationships between investment in advanced manufacturing technology (AMT), the planning effort associated with that investment and operational performance of manufacturing firms operating in Australia and Canada. We used this data to test the proposition that foreign firms manage the implementation of AMT better than their domestic counterparts. Several reasons have been advanced for this largely untested proposition. Three hypotheses derived from it were supported by statistical analysis even when the effect of different organisational sizes is taken into account; lending some support to the persistent idea that Australian managers are not as effective as their overseas counterparts.

Comparing quality management practices in the Australian service and manufacturing industries

Presents a comparative analysis of the attitudes to and the use of quality management practices (QMP) in Australia’s manufacturing and service industries. Outlines the survey methodologies, lists questions asked and summarizes responses to them. Identifies and comments on statistically significant differences in the use of quality management practices between the two sectors. Discusses the attitudes towards the use of and factors which encourage or discourage the implementation of QM practices in Australia’s manufacturing and service industries. Finds that the manufacturing sector uses quality management practices more than the service sector. Attempts to explain these differences and suggests further research.

The effect of electronic commerce on small Australian enterprises

Abstract In Australia, although electronic commerce (e-commerce) has generated a plethora of media articles there has been comparatively little research into its effects on organisations. E-commerce comprises several different technologies (especially those associated with the internet); this paper investigates the frequency of use by and usefulness of these technologies in small Australian businesses. The technologies are differently associated with intermediate variables such as the attraction of new customers and the ability to participate in overseas markets. The statistical evidence that e-commerce is positively correlated with some intermediate variables is overwhelming. We consider the statistical relationships between intermediate variables and final variables (revenues, costs and competitive advantage). There are significant correlations between some sets of intermediate and some final variables; most of these correlations had plausible explanations. There are clear implications for small businesses, for example, the internet allows them to maintain a low-cost foreign presence but it allows foreign firms to compete (at marginal cost) in Australia.

Technology, manufacturing performance and business performance amongst Australian manufacturers

Abstract In 1994, the Australian Manufacturing Council completed a comprehensive survey of Australian manufacturers. The survey sought information on elements of manufacturing strategy, manufacturing practices (e.g. benchmarking and people management), manufacturing performance (quality and timeliness) and business performance (sales growth, exports and market share). An aspect of manufacturing practice was the use of advanced manufacturing technology (AMT). In this paper we report on the statistical links between the use of AMT, manufacturing performance and business performance amongst Australian manufacturers. Statistical estimates of the strength of these links depend on the assumptions made about the data. Our findings will disappoint those who hope or expect technology to be strongly associated with business success: the statistical evidence is equivocal. While noting that statistical association does not imply causation, we nevertheless suggest some plausible explanations of strong associations. More study of the ways in which human, social and organisational factors mediate the way in which technology affects organisational performance is required.

Service level agreements: An essential aspect of outsourcing

This paper notes and explains the increasing use of service level agreements (SLAs), stresses their importance to insourcing and outsourcing relationships, proposes a taxonomy of service attributes, and recommends a hierarchical methodology for constructing SLAs. Evidence from interviews and examination of SLA documents suggests that well-designed SLAs contribute to fruitful relationships between business partners. The proposed methodology and taxonomy will simplify the time-consuming tasks of writing and negotiating SLAs. SLAs have not received academic attention proportionate to their commercial importance. Research to ascertain whether SLAs are used effectively and to seek better expression of business requirements in an SLA is appropriate.

Quality management in Australian service industries

Reports the results of a survey of quality management practices (QMP) in Australian service companies. Although service industries are much more important contributors to GNP and employment than manufacturing industries, most quality management literature is oriented toward manufacturing. We review relevant parts of that literature, especially that on QMP, and propose a definition of this concept. Provides basic information on the use of QMP in Australian service industries such as what QM practices are used, what training is undertaken, attitudes to QMP and impediments to its adoption. We draw conclusions and suggest areas of potential improvement. The most interesting findings are that, first, although 94 per cent of the companies used at least one QM practice, there is no link between the use of QMP and company size or success, second, most companies are progressive in their dealings with suppliers and customers and, third, view training positively.

Benchmarking business processes in software production: A case study

Organisations constantly seek improvement of organisational practices or market positions by implementing improvement programs and quality initiatives such as ISO certification. An improvement project is any project that aims to make a business process more efficient, flexible, reliable or responsive; or raise the quality of working life. Notes that few organisations make the effort to evaluate the effectiveness of such improvement programs, explores why this might be so, and describes some of the benefits of undertaking evaluation activities. Presents a methodology for selecting Key Performance Indicators most appropriate to selected business processes and assessing an improvement program, and describes the methodology’s implementation in a small Australian software company. Stresses that measurement of performance before and after ostensible improvements is needed for objective assessment of change processes.

Investment decisions in Australian manufacturing

Abstract In 1996–7 the author conducted structured interviews with managing directors and production managers of Australian manufacturing companies. The objectives were to ascertain the criteria firms used to make investment decisions in manufacturing technology; how (and how well) they managed the introduction of new technology; whether (after implementation) they had experienced unanticipated effects from new technology and what factors impeded or assisted its implementation. This paper discusses past work, describes the methodology, suggests a way of grouping criteria and gives some preliminary findings. The most important finding is that tangible criteria dominate decision processes but that considerable intangible benefits are usually experienced.