Managing a CAD Outsourcing Project

by Lakshman Balaraman
This may sound obvious, but probably the biggest stumbling block to offshore outsourcing is that after all the contracts have been signed, companies abdicate responsibility for projects to the provider...
- Deepak Khandelwal, McKinsey, Worldwide

We must first emphasize that here we are talking about outsourcing CAD projects, which is significantly easier than outsourcing software development or IT services (earlier articles of mine have explained why).

This article also assumes that selection of the CAD providers has been completed with due diligence (the methods are described in an earlier article).

As I mentioned in those prior articles, one of the most important ingredients for successful outsourcing is management of the ongoing project by you, the client. To quote from those articles (here 'outsourcer' means 'provider'):


(1) You have to assume moral responsibility for the project.

A very senior executive should be made the champion of the CAD project. S/he will need technical and administrative people to help with the project, and these people should be informed of their induction explicitly. Let's call this group of people "the task force".

(2) The task force should define the objectives of the proposed CAD outsourcing.

Subjects to address:

(3) The task force should put the above documents into a contract.

The contract should also contain non-disclosure clauses. The provider should sign and return the contract.

(4) Put robust communication mechanisms in place.

(5) Have a procedure in place for conflict resolution.

(6) As far as possible, do not let go of existing staff because you are outsourcing.

Identify unfulfilled skill needs in your organization when you first think of outsourcing. Explain to the relevant staff that you plan to outsource and that you will train them in those skills. If nevertheless some want to leave, they are responsible for their departure and not you.

(7) Be ready with support services and materials for your providers.

... end users engaged in outsourcing indicate that, on average, users spend from 5 to 12 percent of the total contract value on managing the relationship
- The Yankee Group
(in a recent study)

(8) Develop a partner relationship with the provider.

(9) Budget for the outsourcing exercise.

Use this valuable observation to help you plan:


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About the Author

Lakshman Balaraman, MSEE (University of Michigan), is Executive Director of The Magnum Group,, an engineering and architectural design services company located at Chennai, India.

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