I've been passing the posts on outsourcing to some at my company (we're in
the process of out-sourcing), the following is a response from one of the
Program Managers.  What do you think?


When your company does not want to continually invest in capital, because
your in-house volume is not enough to pay-back that investment, outsourcing
becomes a solid alternative.  Contract Manufactures have the ability to
spread that investment in capital over many different jobs, as where a
company with only a few projects may not.  Anything you can do to lower the
overheads benefits many programs, even those who do not have work in the
area you are out-sourcing. Out-sourcing will certainly lower your material
handling cost.

The problem occurs in that, you need a total commitment to out-sourcing.
Meaning that to reap the full benefit you have to first, find a lower cost
source, second,  cut the staff (support and touch), equipment, and space in
relation to the out-source.  If you do not do both of those things, then
out-sourcing is not worth while.  Most companies are afraid to fully commit,
which means that the program, providing you have found a lower cost source,
not the company will benefit.

Of further concern is that the same people who feel their jobs are in
jeopardy, due to out-sourcing, become the same people that are relied upon
to determine if the out-source supplier meets the company standard.  I have
yet to hear anybody admit that another companies work is as good as theirs,
and in fact have heard too many times how the other company stinks.
Out-sourcing becomes a tough thing to personally do, especially because most
times it has nothing to do with the skill and dedication of your work-force
and yet they cannot help but to take it personally.


Jim Marsico
Senior Engineer
Production Engineering
AIL/Electronics Systems Group
An EDO Company
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