Why Companies Outsource

 

ITToolbox recently came out with its 2003 Outsourcing Survey. Apart from the usual bits of information, it also contains some interesting insights about the world of IT outsourcing--some reinforce already existing beliefs for and against outsourcing, and some give serious food for thought to open-minded folks.

What really stands out is that 72 percent of these respondents said that their company is currently outsourcing some form of IT functions. It is a significant figure, but one should not deduce that outsourcing is so widely embraced because--though 600 IT professionals participated in the survey--it is not clear how representative the sample was. Another factor of the survey is that it covers all IT outsourcing, including offshore and onshore outsourcing.

However, there are many other deductions that can be derived from the survey that could help companies--those that want to leverage outsourcing and those that want to provide outsourcing services--devise effective strategies.

The main reason that companies outsource is definitely cost--36 percent do it to cut cost. But there are other significant reasons, including the need for specialized skills (cited by 15 percent), lack of in-house expertise (13 percent), improved company focus (9 percent) and difficulty in getting and retaining IT employees (6 percent).

Size Does Matter
It is no wonder that more large …

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