Identifying constraints in the value chain of knowledge based services in Canada: case study of Canadian accounting firms

With the digital revolution and dramatic fall in the international telecommunication costs, the world has become ' flat'--the leveling of playing field between developed and developing countries. This study was cast in the background of increasing trend globally among firms in manufacturing and service sector areas to fragment their production across firms and geographical locations. In Canada too, substantial work in the manufacturing sector as well as service sector especially in knowledge based areas like customer support, information systems, software programming, accounting, medical technicians etc., is outsourced to other firms/countries. The present study examines the prospects of value addition of a knowledge based industry--accounting industry in Canada. The study uses accounting firms in Prince George, BC, as a case study. Accounting firms in Prince George represent small, medium and large firms and as such represents a cross-section of accounting firms in Canada. Our investigation found that there is considerable constraints in the form of skill shortages, timeliness in delivery of accounts, employee retention and other cost overrun issues among accounting firms in Prince George, British Columbia.