Does a competitive outsourcing market exist?
A second consideration for outsourcing, that is related to the above model, is to decide whether a competitive market for the outsourced services actually exists. In particular, when dealing with highly specialised maintenance services (such as specialised turbine maintenance) or maintenance occurring in remote areas (such as at remote mine sites), once an outsourced maintenance service provider has been selected, this may create large barriers to entry for other potential maintenance service providers wishing to enter into this market. While these barriers may be overcome, by adopting an appropriate outsourcing strategy (such as letting work to two or more contractors, rather than to one exclusively), awareness of this possible outcome prior to establishing the outsourcing strategy is vital if the outsourcing organisation is not to find itself “locked in” to a sole provider.
