Fitting in Outsourcing

In general, outsourcing is not really scary. All about outsourcing is to shift some of IT functions from in-house to external IT service providers. Your strategy to deal with outsourcing is to make yourself fit in the trend. There is another kind of outsourcing - offshore outsourcing, that could cause real threat to us. We'll talk about offshore outsourcing in the next article.

The Outsourcing Trends

According to IT labor market research, 35% to 45% of full-time IT jobs in the U.S. and Canada will be shifted to contractors, consultants, offshore technicians or part-time workers by 2005. Some analysts and IT labor experts predict these figures even higher.

Shifting IT job functions from in-house to outside service providers is so called outsourcing. As this trend gets increasingly popular, more and more executives want to give it a try and throw something to the outsourced den.

Outsourcing benefits to business

Like it or not, outsourcing is an inevitable trend because:

  • Outsourcing is cost-effective for many IT functions from application development to systems support.
  • Outsource provides specificalized expertise in the latest technologies that could be hard to achieve through training in-house staff because of the fast pace on new technology advancement.
  • Outsourcing could eliminate certain HR problems and labor conflicts and reduce HR management and payroll functions within the company, thus improve overall operating efficiency.
  • By reducing the in-hours workforce, Outsourcing out some pressure on existing staff and push them to improve performance. It also helps in-house staff learn new technologies and skills from outsourced contractors and consultants.
  • As software products become standardized in component based modules, it makes more sense to outsource software development projects.
  • Internet technologies make remote and distributed IT service outsourcing cheap, easy, practical, and effective. Using the Internet, outsourced technical services such as remote DBA and online support become possible.

Negative side of outsourcing

Outsourcing is often touted as an easy way to achieve more functionality for less money, with less aggravation. However, not all management people agree with outsourcing. Concerning issues of outsourcing include:

  • For some business and companies, outsourcing hasn't proved to be a lower-cost alternative to keeping IT inside corporate walls.
  • Outsourcing can make company locked into long-term contracts that may not be relevant to the business anymore due to changes of economy. In this case, in-house function is a better choice if you want to be in control of your own destiny.
  • Security is often a concern in outsourcing, especially offshore outsourcing. In order to safeguard critical business secrets and technologies, companies often keep IT inside the corporate boundary.

After all, outsourcing is not magic to solve business problems. In fact, very few corporations outsource the entire IT body. More or less they keep some of IT functions inside the corporate wall. A lot of companies still do everything in-house.

How to Fit in

The strategy to dealing with outsourcing is to fit in with the trend. The outsourcing trend moves IT jobs from corporations to IT consulting firms that provide software development, network support, system integration, and so forth. Thus, instead of having a corporate career, you may find your position as an outsourcing provider - you can work as a consultant, contractor, or temp worker; you may need to work on multiple projects concurrently; you may be on your own as an independent consultant.

If you lost your corporate job due to outsourcing; if you feel it's harder to find a permanent job with a corporation, you should turn to IT service opportunities with a consulting career. As more and more IT jobs go outsourcing, there is an increasing demand for IT consultants. Although you don't have the same good benefits and stability as on a corporate job, you get better paid and have more flexibility when working as a consultant. Also, you have better chance to learn new technologies and build experience quickly as you may be assigned to various challenging projects.