More efficient to cross the street than to go to Asia
Lars-Olof Gustafsson relates that Ericsson has long experience of outsourcing development work globally. However, about three years ago parts of testing, system simulation and program code production were brought home from a low-cost location to Sweden.
The order was assigned to Combitech with its Homeshore™ operation in Älvsjö. The concept means that Combitech runs the assignment in its own premises which, in this case, are in close proximity to the customer. The price structure is competitive for the Swedish market and efficiency is extremely high due to the proximity between supplier and customer, according to Lars-Olof Gustafsson.
“It can never be cheaper than in low-cost countries but the geographic proximity, efficiency and focus on younger personnel in Sweden produces lower costs than otherwise. And, overall, this is often a better solution. It's quicker to cross the street than to go to Asia.”
There are also long term benefits.
“These include the option of quickly recruiting a specialist straight from the team (homeshore company) and, in the process, building a reserve for the next economic upswing,” says Lars-Olof Gustafsson who has so far been through several cycles of boom and bust in the telecoms industry.
