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02 May 2015

Outsourcing to Reduce Costs

The pressure to reduce costs

Outsourcing the interpretation function can reduce staffing costs. However, it can be a dangerous option if not done right. Here are some things to think about when considering a consultant.

Interpretation skill is critical to maintain a competitive edge

The biggest risk a company faces with outsourcing is the potential loss of access to the latest technology. Unless they select an outsourcing firm that maintains thought leadership in the field, they may effectively be downgrading the quality of decisions they make. That puts them at a competitive disadvantage.

Interpretation is a lot more than science. Less experienced managers may tend to rely too much on quantitative analysis at the expense of more vigorous and thoughtful examination. Artificial intelligence is, after all, artificial. The human abilities of insight and intuition are the core of successful interpretation and exploration.

The outsourcing firm must be able to provide professionals with extensive experience. That experience is in part having worked with volumes of data. Generally it takes at least eight years for a bright interpreter to develop pattern recognition skills and the experience to relate those patterns to past discoveries.

Professional experience also means the ability to focus on the geological problem. Interpretation is not processing data with the hope that something will tumble out. It is active engagement with the data to discern the geology.

The consultant must be connected

Another risk to the exploration firm is the loss of teamwork and the insights that come from group synergy. The team at the outsourcing firm must understand that they do not work in a vacuum. They must understand the culture of the client company and work with the client’s team to build communications and collaboration. The critical relationships for successful outsourcing are shown in the diagram on the left.

For more information

More than ever, it is human capital that distinguishes companies that succeed. To discuss how outsourcing might work for your firm, contact us.