LIST: Canadian Companies That Outsource to Stay On Top
Some Canadian companies have hesitations when it comes to outsourcing because of a bad rep that this strategy has developed in its earlier years. But the Canadian companies that outsource parts of their operations have proved that outsourcing is not too bad at all when you do it right.
While outsourcing is not banned in Canada, there are some strict rules in place that gets most companies thinking twice before engaging a partner. Depending on the industry, companies must comply with these policies, both local and national, before they are allowed to outsource.
Despite all the regulations, many Canadian companies still outsource because of various reasons. Some companies need to reduce cost, some need flexibility, while some just need to focus on the core aspects of their business.
Most of the companies in Canada outsource to third-party providers in the United States, but some innovators have already started outsourcing to the top destinations in Asia, such as India and the Philippines, which allowed them to grow significantly.
Here are some of the top Canadian companies that prove how outsourcing services can be beneficial with the right approach.
The Royal Bank of Canada
No less than the Royal Bank of Canada, the largest bank in the country, has figured out how outsourcing fits their business structure in a bid to deliver better services. The multinational financial services company outsourced IT functions to a third-party provider to enhance their efficiency and security while reducing overhead costs.
The Royal Bank of Canada has been able to maintain a healthy cash flow through technological innovations powered with the help of their outsourced IT support team. Outsourcing has also allowed the company to offer a tightly secured platform for customised online banking – a very convenient option, especially when the pandemic came.
The Toronto Star
When print readers were starting to migrate to digital platforms, Canada’s largest newspaper company immediately saw the need to make a shift in strategy in order to adapt to the rapid evolution of technology in the press. The Toronto Star decided to outsource a bunch of different services to third-party providers, including copy editing, printing, layout, design, and production.
The move allowed them to have flexibility in scaling up and down as the company navigated a period of changes that stemmed from the latest developments in technology. The Toronto Star still enjoys a wide readership, a major feat considering how the rapid shift to digital in the last few years would have stamped them out of circulation.
Canada’s official flag carrier and largest airline has leaned on outsourced support in the years when it faced tough challenges. By partnering with IBM for IT and even HR support, Air Canada was able to get huge savings that made them flexible in terms of scaling up and down on parts of their operations as they navigate turbulent airways.
Air Canada was able to establish itself as a deserving flag carrier, even coming up with a new branding during its 80th anniversary in 2017. The flagship carrier was well on its way for growth until the COVID-19 pandemic came and strict travel restrictions led to some losses, especially in the first year. However, Air Canada said in 2021 that they are recovering faster than expected.
Canadian footwear company Aldo has become a familiar brand not just in the country, but also in other nations around the world. It is one of the companies in Canada that adopted outsourcing as a key strategy in its bid to create world-class footwear. The company began outsourcing business applications and IT infrastructure.
The result speaks for itself. For years, Aldo’s brand remains untarnished as the company has always been able to focus on the core aspects of its business. Moreover, Aldo is known to be one of the first companies to adopt best practices when it comes to employment, regularly monitoring their outsourced staff, giving them proper training, as well as fair wages and benefits.
TELUS is a multinational company engaged in a wide array of businesses that include health, safety, security, and communications. With a lot of work at hand, TELUS has outsourced many parts of the businesses, including a huge call centre that the company has established in the Philippines way back in 2005 to serve customers in North America.
The company has since grown consistently, establishing call centres in Guatemala and El Salvador in 2008, and even setting up delivery service centres in India in 2018. TELUS has been known for adopting a good outsourcing model that prioritises the employees’ welfare, which made joining the organisation very attractive for global talent.
Founded in Vancouver in 2009, the business communication software company has a very popular outsourcing success story that inspired many other companies to follow suit. When it was launched in 2014, Slack decided to outsource design and copy testing services to a local provider. The move allowed them to improve the platform and forge relationships with businesses that use their product.
Outsourcing allowed them to raise $250 million worth of investment in 2017. When Slack outsourced services to a third-party provider, they gained time and resources to focus on the core aspects of their product, which enabled them to improve the business communication software and ultimately, customer experience.
Founded in 1880 in Montreal, Bell Canada is a telecommunications company engaged in producing telephones, mobile phones, digital televisions, radio broadcasting, and internet services. The company has been outsourcing customer service and other IT functions for years now, which enabled them to focus more on its core business operations.
Adopting current outsourcing models as a strategy, Bell Canada has continually grown in terms of revenue throughout the years, except when the COVID-19 pandemic came. However, in 2021, Bell Canada has already seen signs of bouncing back, reporting an annual revenue of CA$23.45 billion, a few millions higher than CA$ 22.88 billion in 2020.
Sun Life Financial
Outsourcing played a key role in the rise of Sun Life, a financial company founded in Montreal in the 1860s. Sun Life began its outsourcing journey in 2002 when it engaged IBM as an outsourcing partner for some of its IT functions, such as mainframe environment, web hosting, network support, as well as email and app support.
They even expanded in 2007, tapping another outsourcing partner in the Philippines for the development and maintenance aspect of their business. Outsourcing allowed Sun Life to access global talent that not only made their work efficient but also brought them closer to their customers in different countries.
Emerging from the consolidation of the Imperial Bank of Canada and the Canadian Bank of Commerce, the Canadian Imperial Bank of Commerce (CIBC) grew to be one of the largest and most trusted banks in the country. For a long time, the CIBC managed to have a stable market portfolio, but the company decided to outsource some of its services in 2017 to meet surging demands.
In this case, outsourcing did more than just help CIBC to save costs. Because of the outsourced services, the company managed to be flexible to the growing number of its customers, as well as the technology-triggered changes in their demands. In February of 2022, the CIBC reported a net income of CA$462 million, up from CA$442 in the last quarter of 2021.
Banking is a sophisticated business that requires constant innovation that aligns with current technologies. Knowing this, Scotiabank, one of the top 5 banks in Canada, has started to integrate outsourcing as a key strategy in their business early in 2001. While all the main operations have been kept in-house, the bank began to outsource data centres, desktops, and ATMs to a local provider.
With an outsourcing partner able to handle the other technical business functions, the Toronto-based bank has maintained a stable portfolio throughout its years, until the COVID-19 came, when revenue slightly dropped. Outsourcing may have been working for the bank as it plans to outsource customer service offshore as they continue to expand.
Outsourcing needs your time and effort
Outsourcing has been a key strategy of business not just in Canada, but around the world. While its benefits are promising, outsourcing will always require dedication, time, and effort because more than an instant upgrade, it is an investment.
If you are planning to outsource parts of your business to third-party providers, you may want to start by identifying the problems you need to address first. This will guide you as you look for the provider that can deliver the exact results you need.