Does Everyone Outsource Now?

I have a positive feeling about outsourcing and off-shoring because of our experiences. I know these feelings aren't universal. But I suspect you have some experience, too, although you don't think of it that way.

For instance, do you hire engineers for structural work? Or how about a 3D rendering outfit. Sub-contracting is just another word for outsourcing. Outsourcing has the connotation of being off-shore, but that may not be the case. Anyway, off-shoring is really hard to get negative about if you dig deep enough. The knee-jerk reaction is that we are sending jobs overseas. Even as big as the US is, if we didn't sell overseas, many businesses would be unnecessarily limited. And it works both ways. How much do you think a TV would cost if we excluded foreign companies? Automobiles? My first auto cost $3,500 in 1968. The same auto now would cost, according to the CPI, $23,000 - rusting body, crank windows, no A/C, crappy suspension, no power anything. We have Japanese automakers to thank for Detroit getting their act together (kinda). World trade and open markets are a good thing for the consumer. Businesses don't like the competition, but they do like to bully public opinion and elected officials. Corporate welfare?

So my point is that outsourcing and off-shoring is how the world works nowadays. And contrary to all the whining and pandering to parochial instincts, we are better off because of it.

Wow. That's not where I thought this was going.

My real point was to say it can work for you and help you keep more of your fee. But it isn't without its downside.

A mundane example: we once used a different structural engineer at the client's request. Two weeks after sending them our Design Development drawings for a custom office building, they sent us final working drawings. Our working drawings were going to take three months. They hadn't coordinated with anyone. But they were cheap and fast. They weren't so good with the 'custom' part of the project. And they weren't happy about the changes they had to make.

The main thing we have learned from working with local drafting sub-contractors, Lithuanian rendering companies, interior designers, Asian CAD support and all types of engineers is that you have to spell out the process you want and what the milestones are. Every one of them just want to run with it and get to the finish line as soon as possible. This just causes more work for everyone.

An example of setting a process and milestones, using drafting of wall sections as an example, would be:

• Review CAD standards, layering, scales, and provide examples including a sample specification for clarification.
  
• Have them rough out the wall outline with structure shown, and with vertical and horizontal dimensions shown accurately.
  
• Next they show all the materials in their proper relationship with line weights tied down. Include any section cut marks.
  
• They add dimensions, and then add notations using the terminology found in the sample specs. Include special notes from earlier markups.
  
• Make final changes and add poche.
  

Each step needs other instructions about the intent and a review/markup on your part that acts as approval to proceed. We found that this was pretty much the minimum effort on our part to get acceptable results. If you don't do it, the inevitable re-work takes longer than 'managing the process'. Unexpectedly we found that this kind of managing the process gave better results in-house, too.

Another unexpected discovery from outsourcing was that you were better off to give someone the day off (with pay) than jump out of sequence and have them do tasks that were premature. Again, the re-work always comes back to haunt you. (Maybe organizing the library or filing would be a more realistic than sending someone home.)

We found there are three main advantages to using outsourcing. First, there can be significant savings if you are outsourcing off-shore. Second, you can align your staffing with a predictable lever of work, and use outsourcing to add extra capacity when needed without training, more equipment, furniture, etc. Third, you can extend your capabilities in the case of outsourcing to specialists. For example if you aren't using Revit, ArchiCad, VectorWorks and the like, an Asian 3D specialist can develop renderings and fly-bys for a fraction of what it would cost you to do it yourself - if you had the software. Clients like 3D.

Staffing up quickly for a big project or two is costly, depletes your cash before revenue catches up, and has inefficiencies built in. Not to mention, the inevitable failure to downsize soon enough when the work dries up. Outsourcing is the safer solution.

I am not saying you should outsource / off-shore, but a little investigation wouldn't hurt either.

This is another article I wrote a while back on Outsourcing / Off-shoring.

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Photo Credit: Mathieu Jang