To Insource or Outsource IT?

Michael R. Wood is a Business Process Improvement & IT Strategist Independent Consultant. He is creator of the business process-improvement methodology called HELIX and founder of The Natural Intelligence Group, a strategy, process improvement and technology consulting company. He is also a CPA, has served as an Adjunct Professor in Pepperdine's Management MBA program, an Associate Professor at California Lutheran University, and on the boards of numerous professional organizations. Mr. Wood is a sought after presenter of HELIX workshops and seminars in both the U.S. and Europe.

Like most highly charged topics, outsourcing of the IT function borders on that of a philosophical and religious argument. While the pros and cons abound (as do the successes and failures), how can a CIO decide if outsourcing makes sense for their organization?
In this in-depth article, some of the issues and criteria for identifying and evaluating outsourcing opportunities are explored--and the conclusions might surprise you.
In general, the only types of work that cannot be outsourced today are jobs that require face-to-face interaction, leaving the field wide open for virtually every type of IT job other than requirements facilitators, trainers and user relationship personnel. However, what is prudent to outsource is another question altogether.
The real question for the CIO to address is this:
What is the best way for IT to deliver consistent, responsive and high-quality value to the enterprise, and how does outsourcing fit into that equation?
To answer that question, the CIO needs to consider how outsourcing can help leverage the organization's ability to:
  • Improve ROI on its investment in IT resources
  • Fuel sustainable growth
  • Level the competitive landscape
  • Support scalable, more agile and adaptive operational workforce
In addition, the CIO should reflect on the negative impact any outsourcing …

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