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Outsourcing: Pro or Con?


There are definitely two perspectives!

RBC’s recent brouhaha brought to mind the points Bill Howatt made in his March 20, 2013 article in the Globe and Mail ”If you want to lead, you need to make the right decisions”.  He showcased Fear (how it influences emotions in an organization), Facts (how correct info impacts decision making), Future (how the consequences of decisions affect each stakeholder) and Fulcrum (how timing decisions is key).

It’s interesting that there didn’t seem to be nearly the same outcry when Bell transitioned to off-shore call centres.  People grumbled more about lack of quality service than loss of jobs.

Outsourcing (contracting out to a third party) isn’t new:  employers have used it as an accepted practice for years.  It rarely raises an eyebrow when done locally or nationally.  It’s usually when it goes internationally that emotions run so high. 

Immigration rules are clear.  You can’t displace Canadians to hire abroad.  You must conduct (and document) a reasonable search to determine that no qualified Canadian is ready, willing and able to assume the role.  Often vacancies with more limited scope and autonomy are challenging to fill locally because some Canadians will choose to stay on EI or other government programs while they wait for a better fit role.  

The benefits of outsourcing are clear.

  • Timeliness:  Work can be performed just in time
  • Cost savings:  Hourly rates can be more economical 
  • Specialized skills:  Hard to find skill sets can be easier to find leading to higher quality work
  • Staffing efficiencies:  The actual and opportunity costs of recruiting can be reduced leading to greater capacity for full time employees
  • Risk mitigation:  Clear contracts can lower risks  

The challenges of retaining oursourced workers are equally clear:

  • Engagement:  Third parties may not offer the knowledge (e.g. corporate culture), skills (e.g. language)  and experience (e.g. complex projects) to provide the quality service that ensures client loyalty and profitability

At the end of the day, each employer needs the freedom to take calculated risks and make informed decisions, within the context of legislation and global best practices,  to determine what is right for his or her organization. 

Oh that RBC had taken Bill Howatt’s advice and managed Fear, Facts, Future and Fulcrum more effectively upfront!