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Why we should rely on those who know best to deliver more value

Outsourcing

Pierre Bastjaens

Head of Services & Operations Procurement

16 March 2017

“Do what you do best, and outsource the rest”

3

4

1.3 million bottles

5

1 million nights

6

ULDs

1,000,000

movements

per annum

20,000

pieces

13

types

58 to 100

kilos

Plan

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© Cathay Pacific Airways Limited and its subsidiaries

Business objectives

• Cost optimisation

• Efficiency gains

• Innovation

Partnership P

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© Cathay Pacific Airways Limited and its subsidiaries

The right partner

• Major player

• Scale and strong financials

• Solid track record

• Strong innovation capabilities

Process

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The process

• Business requirements definition

• Risk analysis

• Contractual framework

• Financial modelling

• RFP

Challenges P

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The challenges

• Specifying precisely what was required

• Defining clear and realistic service levels

• Working out the baseline cost

• Resistance to change

Progress

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Progress

• Typical teething issues have been overcome

• Resistance to change has disappeared

• Value is coming to the business

Outsourcing was the right decision!

Value P

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Procurement’s value

• Work closely with the business

• Challenge the requirements

• Robust and flexible contract

• A well balanced deal

Take-aways

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Take-aways

• You should focus on what you do best

• Outsourcing = competitive advantage

• Outsourcing should be on your radar

“If you deprive yourself of outsourcing and your competitors do not, you’re

putting yourself out of business”