Taking Engineering Services Offshore - The Scandinavian Experience

Paper in proceeding, 2013

“Offshoring” has become increasing attractive for European engineering consulting firms, either through the use of external resources (outsourcing) or by relocating internal activities (the captive arrangement of foreign direct investment). Consulting companies may experience lack of skilled personnel and or an increasing pressure on costs. Moreover countries like China and India provide highly qualified engineers at a relative low level of remuneration compared with their Western counterparts. The aim of this paper is to investigate the experiences of Scandinavian based consulting engineers concerning offshoring, which often begins with a single project, but early positive results and the production flexibility of many developing countries can quickly lead to a more profound collaboration and even to a strategic transformation of the Scandinavian firm. For its theoretical foundations the paper builds on international business and strategic management approaches. The empirical research uses desk research investigations of companies in Denmark, Sweden and Norway. An exploratory study focuses on a single case supplemented with a preliminary evaluation of the 30 largest consulting engineering companies in Scandinavia.