Resort to IT OutsourcingFriday, March 31, 2006
Most companies resort to IT Outsourcing as their short-term tactical measure to cut the costs rather than as a business strategy. Gartner says according to new report which surveyed 950 individuals in America, Europe and Asia-Pacific nations. With its concluded report says that strategic IT Outsourcing can be an integral part of any organization’s long term success of business, most global companies are still focused on tactical IT Outsourcing as a means of lowering the costs.
With regards to survey reducing and controlling of operating costs and improving efficiency was identified by more than half of the surveyors in each segment as the primary and significant value they expected to receive from IT Outsourcing. The majority of efficiency deals are focusing on lowering of cost, over time, cost controlling with the consistency maintenance of goal in service delivery. The survey found actually that there are few firms to outsource Information Technology as objective to improve their business and competitiveness in it.
In the market today, one of the great clashes is driven with the dominant use of Offshoring to reduce the costs, along with needs for customized services, only by moving to standardized services and foregoing customization can the market effectively and reliably deliver the cost efficient objectives. It is to be said that by achieving cost take out was identified as the foremost and important factor of Outsourcing, with large companies more frequently identifying these factors than smaller firms. With the followings of cost take out, respondents rated achieve speed, flexibility, agility and gain access to technical expertise or skills are equally as leading factors in Information Technology and Software Development work.
Factors of IT Outsourcing
Overall, fluctuations existed by horizontal and vertical market or by geographical factors. Government, process manufacturing, financial services, services, transportation and wholesale-retail companies all ranked as cost take out with the top factors of IT Outsourcing. North U.S. surveyors identified to improve IT service for end users as their leading factor. The top 2 things to IT Outsourcing is really focused on data security and privacy issues for concerns around the potential costs of Offshore Outsourcing.
Organizations have main concerns about control loosing in their intellectual capital and the business knowledge of main workers whose jobs and roles may be threatened by Outsourcing, at the time of downsizing particularly. As part of their sourcing strategy, companies must carefully examine the objectives that wish to reach from Offshore Outsourcing, but equally their concerns as well. The exercise will not only help in developing a sourcing strategy, sourcing maxims and prioritization of goals or objectives, but will help to educate various constituents in company about realistic results and possible false assumptions and outcomes and misperceptions that it holds about IT Outsourcing.