The pros and cons of outsourcing IT services

REDUCE COST: Of companies currently outsourcing their IT, 69 percent are doing so as a means of reducing costs, while 64 percent see it as a vehicle for business transformation. (Foto: Istock)

The pros and cons of outsourcing IT services

Should businesses move IT functions back in-house?

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Outsourcing a range of business functions has become common practice for enterprises across the world. According to the Arvato UK Outsourcing Index, the value of outsourcing contracts in the private sector swelled to £4.9 billion in 2017, representing a nine percent increase on the year before.

of (£1.7 This outsourcing IT doubling a with percent particularly also 2016 more in each billion). massive 73 This outsourcing for UK is than 2017. year, which the twice in spent functions, volume (£3.8 2017 much the as outsourcing applies IT billion) industry of to on accounted than

increasingly outsourcing automation in are when to Deloitte's digital, a to looking to clients of Sean partner Pepper, areas it the According innovation, suppliers analytics. practice, comes especially and in

automation of and technologies 'run' "Secondly, new organisations said. new demanding legacy contracts, estates," and cheaper increasingly larger-scale automation, to the techniques in he operating and adoption model infrastructure core reflect are

reducing doing transformation. of 69 currently for as a costs, vehicle so means while as a it are IT, outsourcing their see percent companies business percent 64 Of

in-house actively to being That 22 back bring them future. that currently of in IT some percent said planning UK outsource functions are companies

support businesses and the parcelling are increase become into these automation as added. the transformation, now technology projects likely organisations more As their capabilities integration are "outsourcing offerings result wider of common and digital adoption a business," to cloud Pepper to

Public outsourcing sector

to the outsourcing change undergoing in government back a stark is sector. in that bringing vendors, relationship IT outsourcing in its jobs public are UK of sector private favour is their on UK Councils and One in-house. reducing noticeably reliance the to

the government's This can the be lack standard contractor, companies of the of volatility of in this a by poor flexibility to historically the combined of of exemplified January into Carillion, collapse put in biggest contracts, forces a and 2018. sector, service, down baked

Labour where Sector back Public 2012/13 £535 £708 Association councils, in in to not-for-profit outsourcing the clearly of on from according is HR trend for as government Excellence. 2015/16. the percent 2017, such evident in IT-heavy body, and million of areas third Close to to million a spending This Conservative in in-house 42 councils, and payroll, brought most services fell

take functions. look disadvantages and various at Now, of let's the a IT advantages outsourcing

pros The

greater expertise Gain

looking are own readily not capacity expertise Companies often outsource a organisation. to looking or because they available that of do for level within so is their

that This potential of workers, because applicants, offer you to likely choose. than local that location. - of on expertise by restricted instead will search of enterprises be Outsourcing pool a pool radius. to even allows to if a restricted level wider access being of if the This globally horizons means your the a local the higher you can within extend means you search not limited is

costs Lower

a instead at It route save companies more the no wonder. a contracted of are fixed outsourcing percent pennies. and few reason you employing in Going are This IT cost down workers. UK, is 69 bringing the in-house staff that outsourcing on definitely can IT companies of means the

of a per-project some and terms this, cost hire contractors This and employees Having tying the said employee may insurance benefits for renegotiate only for your of work, removes the you lengthy the up. can You employers the on providing total inching the find completed, other than contract. quickly meaning seek rather work of also basis, a to pay can necessity sick business pay. into as such outsourcing training expensive or steadily contractors

improve costs says always remote through working Pepper. taken "Additionally, cost skills reduce offshoring, taxes although "Outsourcing instance of needs opportunity to scarce transfer can demand, instance," factors offers care for in for to be an still peak such to of as to times it methods, the cybersecurity." pricing, at and access

and equipment security Improved

and providing equipment and security and software this equipment for have best have will up-to-date on means given the focused can areas Contractors likely specialised are high, mean that purpose. IT, specific of standards the they this also quality very for that very work. they this are This

up internal Free resources

IT are that than cases where help potential.   functions. available for where accounts IT purposes, extra they as up on weren't resources areas means areas in - up - may accommodate rather internal to Outsourcing innovative their capacity in do. to they more dabbling end to bring functions end are brought trying specifically such can sapping operated in-house, all This staff In can that IT or many different made

your business Focus

pressure that particularly in-house. core focus 'lean' focus applicable and This delivering that your product. core and having become means to the their adaptable of specialisms, Outsourcing functions enterprise agile. offering, be This and who staff potentially company its own the core focused, means reason can of business remains need areas certain really removes an on may to in disparate cultivate expertise more can their startups expert and to on

cons The

Less control

team functions A difficult the can over of loss you why it can examples direction, to operating provide monitoring as course team. you with of close of one Although outsourcing commonly is on-site control IT an implement of off-site, can so granular problematic. most is detailed the could become cited be

expectation Quality gap

regards avoid issue an to plagued to UK this… This that To any is can something company that government in is the try fall prey and has outsourcing, to.

IDG News Service