Outsourcing Engineering Services in Canada – Risk or Safeties?

Outsourcing has existed for as long as one can remember, but it has garnered greater attention due to the revolution brought in by the Internet. Outsourcing of engineering services has not reached the scale attained by the IT services Industry yet, but it has the potential to do so.

The principal driver of outsourcing is the availability of low-cost resources in developing nations coupled with competitive pressures exerted on organizations in developed nations. While the benefits of outsourcing are evidently manifold, it is not immune to risks. An effective outsourcing strategy, therefore, should have risk management built into the supply chain.

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The ecosystem of service providers in the developing world can be aptly described as a few islands of excellence in the sea of mediocrity'! The trick, therefore, lies in identifying agencies that represent these islands of excellence. It is the intent of this article to enable the reader to spot the lighthouses and icebergs on their way to those islands.

Resources: In its essence, the agency to which an assignment is outsourced is as good as the constituent team that is engaged for the delivery of that assignment.

Therefore, an effective way to differentiate winners from the 'also ran's is to assess the key team members. Educational qualifications, diversity of work experience, number of years with the firm, and a list of assignments executed by them are good indicators to assess the competence of the team.

Freelancers Vs Organization: If good employees were the only checkpoint, one could easily get hold of 'free lancers' who do not have the backing of any organization. Freelancers suffice for small jobs once in a while, but they cannot be relied upon for large assignments requiring diverse skills in a sustained manner.

Especially in the services industry, where the requirement could be generic or specialized depending on the type of assignment, it is imperative that execution be undertaken by a team comprising multiple resources (with diverse capabilities and points of view).

Therefore, one should look for organizations that have been in the business for at least a few years. Size of the organization, registration with local statutory bodies, web presence, and client list are some of the aspects to be examined.

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