The Key to Optimum Outsourcing

Jiju ‘Jay’ Nair is a Senior Manager with Fannie Mae driving Cloud Transformation and adoption. He is an avid advocate for using innovative project and process management principles for building reliable and sustainable products.

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Topics: Consulting, Cost Management, Information Technology, Outsourcing, Procurement Management, Quality, Requirements Management, Risk Management, Scheduling, Talent Management

Outsourcing IT projects has now become a very mature paradigm for many organizations (that is not to say that it does not come with its own slew of potholes and disasters). Gartner surveys indicate that the Application Outsourcing (AO) segment has witnessed more growth in the recent years. Most of this growth can be attributed to organizations’ needs to manage their complex legacy application environments and their commercial off-the-shelf (COTS) packages that support their businesses. Data Center outsourcing, which had seen substantial growth in the past, is predicted to reach a plateau. However, the real winner could be Cloud computing service projects, which will see tremendous immediate growth. All these facts means that outsourcing IT projects will still be a major factor in cost savings for many organizations.

The terms “outsourcing” and “offshoring” are often used interchangeably because of the fact that many outsourced projects are nowadays implemented in offshore locations outside of the United States. Some studies have indicated that the real benefits of offshore outsourcing can be diminished by the issues in communication, skill sets, accountability and data security that have plagued many projects.

However, if managed properly, offshore IT projects can reap substantial rewards. In one of its reports, the Federal Deposit …

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