Contract Manufacturing vs. Outside Processing – Which Process Fits This Scenario?

We are working on a subcontracting scenario in Oracle Fusion and trying to determine whether Contract Manufacturing or Outside Processing is the best fit for our operational requirements.

Below is the detailed process we follow today:

Current Process Flow

1. A “Make” requirement is generated in Supply Planning.
2. A Work Order (WO) is created, containing an operation configured as subcontracting.
3. When the first operation is completed, the system generates a requisition that creates a subcontracting Purchase Order (PO).
4. The PO is sent to the subcontracted supplier.
5. The components required for the subcontracted operation (listed on the WO) are picked from inventory and physically shipped to the supplier.