Do some outsourcing companies manage their clients' outsourcing needs via sub-outsourcing?

Yes. So long as they are transparent about this to their client, I think its a win-win-win situation. Many firms do it without informing their clients, which is not only wrong but also unprofessional.

Yes, some do. Depending on the context it may be good or bad for the buyer. It's good when a specialist gets in to solve an issue, build a module which otherwise would be inefficient to do inhouse. Classic example is that of some dev shops outsourcing design work. Where it becomes bad for the buyer, is when the first level adds mere management oversight or other such redundancies that increase the layers of separation between you and the code (or coder). Have a no sub-contract clause in your MSAs or have riders.

Yes, client would like for the provider to be transparent on this.

I would have to say yes. As the business developer for a nearshore company, globalinsightsoft, I have been approached to the view of cross continental staff augmentation to mutual benefit. We have always been uncomfortable with the idea as we wish to ensure our best work for our clients. It is not true of all companies though. No names, but it happens.

Unfortunately yes. And as for me it's a mess. The reason may vary. Either they are not capable to complete the task and they have to sub-outsource it or they just don't have time. As a businedd developer I see dozen of disadvantages in this idea. First and the main one is lack of communication. The project will be 100% delayed if sub-outsourcing was used.

Some of them might, but the best ones don't. Quality comes from within the team. Having various connections in the below listed companies, I can assure you they service their clients with their in-house team and no Sub-outsourcing is done. TCS - http://www.tcs.com/Pages/default.aspx Cognizant - http://www.cognizant.com/ Infosys - http://www.infosys.com/ Cogneesol - https://www.cogneesol.com/ HCL - http://www.hcl.com/ Thanks.

Yes firms sub-contract work for a few reasons: 1. They may not have the skill set in house to serve your needs 2. They have the skill set but they do not have sufficient talent available at the time to serve you 3. A common case of sub outsourcing is when a project gets outsourced to a development firm that does not perform design. In this case they will partner with a design firm to subcontract work to the design firm 4. Consult an expert - some firms might subcontract are part of the work to an expert that either helps them out or guides them how to complete a specific problem It is important that the development firm be honest about this so you are not left in the dark. The main problems or concerns with this - 1. Subcontracting can add many managerial layers that causes a long delay between the message that you have arrives to the developer or designer that is actually working on it. Communication is the number one most important part of outsourcing so if the development firm wants to be client facing then there will be an issue with poor communication. 2. If you have multiple levels of subcontracting then you will have too many project managers (you could have one PM in each firm) and therefore you will have to pay for these project managers which will increase the price. If firms are clear about this from the beginning and let you communicate directly then these issues will be less of a problem but definitely be careful when you have many layers of project managers.

If there's a task an outsourcing company can't perform, it's better to simply refer the sub-outsourcing company to your client and let the client deal directly with them. In this way, you absolve yourself off any responsibility and additionally, avoid becoming a bureaucratic hurdle. Yes, there's always a threat of the sub-outsourcing company snatching your client away from you for the work that you have been doing for them for years! But sometime you just have to learn to say No for something you can't do and have faith in your own capabilities. We at http://www.31West.net follow this belief and it trickles from the top management. In the larger interest of efficiency and quite simply the pleasure of work, this is the best option.

Very interesting question. Answer is some companies try this approach. It might work in short term but definitely not a long term solution and gradually brings down the quality of the work. We at CMARIX always work with our inhouse team. We never sub-contract the work. If our team is packed then we convey it to our customers and they appreciated extending the start date of the project. For technologies we don't work on, we do not take projects. As simple as that :)