IT outsourcing is a common practice these days. While it is difficult to tie down the inception of this business strategy to an exact day, most researchers agree that the birth of IT outsourcing was in the 1980s. Almost forty years from that time have passed and a lot has been changed and improved. IT outsourcing as we know it now provides companies with a big number of opportunities and advantages. That's exactly what we are going to be talking about in this article. Get ready to find out about relevant IT outsourcing benefits and reasons why your company should outsource IT services right now. After finishing reading the article, please tell us which of the following is the main advantage of outsourcing, in your opinion.
What is IT outsourcing?
Well, before we dig deeper into the pros of outsourcing IT services, let's deal with what IT outsourcing is in the first place.
Information technology outsourcing is the practice of searching for an external vendor to handle various IT functions of an organization. Among the most commonly outsourced services in IT are the following: software development, web development, website maintenance, technical support, database development and management, etc. IT outsourcing can be divided into several categories such as offshore outsourcing, nearshore outsourcing, and onshore outsourcing. All of the mentioned types involve hiring a third-party vendor for doing IT-related work of a company.
IT Outsourcing Benefits for Your Business
There are numerous advantages of IT outsourcing for both small businesses and huge enterprises. Being a great strategic tool, it can offer more than just cost-saving opportunities. So, what are the advantages of outsourcing IT services? Let’s see:
Outsourcing helps to manage IT tasks and spikes in workload quickly and efficiently. And the best thing is, you don’t have to overspend on hiring and then firing an in-house employee. This is particularly useful when a company needs a certain skill for a short period of time.
A wide pool of skilled specialists
Access to a wider pool of skilled experts and rare resources has become one of the most significant pros of outsourcing IT services. Sometimes it might be quite difficult to find an in-house employee with a particular set of skills. And it is even more difficult to train those skills. So, it makes more sense to have an outsourced service provider that can provide you with the needed resources and satisfy your company’s needs in skills and technologies as per requirements.
Focus on core business activities of your company
The power of your team can be enhanced with the help of task outsourcing. It is especially important for small to medium companies that don't have a wide array of IT resources. Instead of overloading workers with tasks which they are not well familiar with, it is better to leave those tasks to experts allowing an in-house team to concentrate on major business activities. This IT outsourcing benefit is especially fruitful for companies that operate in non-IT niches. If this is the case, it is always better to outsource all the IT tasks to one service vendor.
One advantage of outsourcing IT services that really stands out is an opportunity to save money. If we take a look at Deloitte’s research, we'll see that 59% of companies choose to outsource IT services because it helps them to cut costs. How exactly does that happen? IT outsourcing is cost-effective because this solution eliminates the need for hiring and training new workers, which is a very costly procedure. On top of that, when outsourcing, a company can forget about extra charges and hidden costs such as buying expensive hardware and software, renting office spaces, paying taxes, etc.
Labor costs can be reduced big time because the rates of outsourced service vendors are usually much lower since they are located in the cheaper regions in terms of IT development (Ukraine, for example).
If the workload is split into several functional parts, the performance is better and you get results faster. That's what outsourcing is about. You delegate some tasks to external experts and those tasks are done at the same time as your core business tasks. Besides, due to the time differences, it is possible to maintain an uninterrupted workflow. Thus, you get faster development performance.
Knowledge of the industry and innovation
No one is going to argue that your in-house employees know your business in and out. However, sometimes this knowledge stands in the way of using innovative approaches when it comes to the processes workers are used to doing. If your business has nothing to do with information technology, there's a decent chance that you're missing out on the latest trends in the industry. Therefore, it is a good idea to opt for IT outsourcing as you will get an innovative look at what your company needs in terms of information technology.
Top-quality equipment which you don't have to buy
Another great benefit of outsourcing IT services to a third-party is that there’s no need for spending thousands of dollars on expensive equipment and software which you will probably need for handing a few tasks per year. Companies that offer IT outsourced services will take care of everything for you so that you could get IT products of the highest quality.
When you cooperate with full-cycle IT companies, they will likely share the service outage risks with you as well as provide disaster recovery and data security services. It is recommended to include this into an agreement when signing it.
How can IT outsourcing help your company? If this is the question that still bothers you, feel free to reach out to us. Our consultants will provide you with relevant information and answer all your questions.
So, wrapping things up, let’s ask the question one more time. Is outsourcing a good idea?
It would be difficult to argue the fact that outsourcing is a powerful tool in the IT-sphere. Believe it or not, in most cases it is a good idea to outsource IT tasks and functions to those who can do them better, faster, and cheaper. However, IT outsourcing isn't all sunshine and rainbows. This strategy has got a few drawbacks which might stand in the way. We highly recommend you weigh all pros and cons of outsourcing before actually choosing it. Nevertheless, you don't have to treat possible risks associated with outsourcing as something you won't be able to avoid. With the proper approach to choosing an outsourced service provider and to writing a contract, there will be no to minimal risks.
Yojji is a full-cycle software development company and a reliable outsource service provider with a proven track record of working under this cooperation model. You can contact us to find out more about our outsourcing services.