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This report is based on extensive research and fieldwork conducted since 2006 by the University of Tennessee on the Vested Outsourcing Business Model. Research partners over the years have included the US Air Force, the Forefront Group, the Sourcing Industry Group, the Centre for Outsourcing Research and Education, the International Association for Contract and Commercial Management (IACCM), the International Association of Outsourcing Professionals and the Council of Supply Chain Management Professionals.
Companies and organizations included in the research and interviews for books, white papers and case studies have included: Minnesota Department of Transportation, Water for People, Dell, GENCO, McDonald's, Procter & Gamble, Microsoft, Novartis, Intel, DHL, Jones Lang LaSalle, Wi-Pro, Expeditors, Adelante.
Vested has published six books:
Vested Outsourcing: Five Rules That Will Transform Outsourcing (2010)
The Vested Way (2010 eBook)
The Vested Outsourcing Manual (2011)
Vested: How P&G, McDonald 's and Microsoft are Redefining Winning in Business Relationships (2012)
Getting to We (2013)
Strategic Sourcing in the New Economy (2015)
The Vested library also has 10 Case Studies and 15 White Papers.
Introduction
Smith (1776), an eccentric Scottish academician at Glasgow University, observed the human propensity for self-interest and formulated the "invisible hand" theory of supply and demand in 1776 with the publication of An Enquiry into the Nature and Causes of the Wealth of Nations. His theory said that society benefits as a whole from a multiplicity of trading transactions because humans seek what is best for them, resulting in fairness and honesty among equals. He also encouraged "division of labor" - a key justification for helping early businesses drive efficiencies in operations and to work more efficiently with trading partners.
As demand for repeat transactions emerged, trading preferences evolved and modern transaction-based business models were born. Transaction-based business models remain the cornerstone of conventional business relationships and form the backbone of current procurement processes.
For the most part, transaction-based approaches served procurement professionals well through the twentieth century. Organizations formed back-office functions to manage the "buying" of goods and services needed to support their organizations.
The procurement profession got a boost beginning in the early 1980s when pioneers such as Kraljic (1983) and Porter (1980) pushed procurement professionals to think more strategically about the art, science and practice of procurement....