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What Are the Benefits of IT Outsourcing?

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8 minuteminutos readde lectura
ByPor Jason Bott

Jason has been working as a consultant and project manager with enterprises of all sizes for over 20 years. His expertise lies in utilizing technology to solve problems that reduce costs and increase profits. He has been instrumental in implementing successful software projects for Shell, NOV, C&J, Nabors, Total, Halliburton, Baker Hughes, Noble, American Tower, AIG, NASA, Nike as well as many smaller firms.

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What is outsourcing and what are the most common processes outsourced?

In today’s competitive world, the key to success lies in identifying those processes within our company that can be improved and repowered. And that is precisely what outsourcing is. It is when the company identifies a process that can be subcontracted with third-party experts in the field to optimize its time and resources, thus increasing its productivity.

There is a wide variety of processes that can be outsourced, from IT to staffing. According to Statista, the global market size for outsourcing services represented US$ 92.5 trillion dollars in 2019 and is a trend that will continue to increase. As can be seen in the table below, technology outsourcing accounted for almost 30% of the total sales of organizations offering professional services.

But to analyze this process it is important to understand what type of services and segments are included in the definition of IT outsourcing. The Market Outlook Technological (TMO) of Statista believes that IT outsourcing can be divided into administrative, applications, web development, and other outsourcing. Together, all of these segments are expected to bring in a revenue of US$ 351 billion by 2021.

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When Should You Be Thinking About IT Outsourcing?

The technological revolution that the world is experiencing makes us realize the increasing importance of being prepared to know how to act and react to the changes that can occur in the blink of an eye. This can lead us to think that our first option is to create an IT department within our company. However, many times this alternative can be expensive and unfeasible for some companies. This is where it comes in because it is an efficient and achievable alternative since it can bring great benefits to your organization that we will explain below.

Why Outsourcing Is Good For Your Business

Profitable

We know that one of the most successful ways to optimize resources is outsourcing. Companies that provide these services will offer competitive prices because they know more about this industry. In addition, expenses related to the hiring and training of personnel will be reduced.

Stay focused on your core business

Employees can focus on those activities that they are good at and help the business grow. This contributes to the business strategy being implemented more efficiently, thus increasing the competitiveness of the business. Let us remember that in a market as competitive as the one we are in, it is important to be at the forefront and strengthen our strategic position.

Personnel flexibility

We know that the context can be quite changeable and that depending on the season the company’s revenue can vary. As a result, outsourcing represents a very attractive alternative for those who want to have more flexibility in recruiting staff. They may need people for short-term or seasonal projects, and outsourcing gives them the ability to avoid the heavy responsibilities that come with having an employee on the payroll.

Extensive experience in the area

In-house IT employees lead an isolated existence no matter how much they train. By spending so much time in one place, this employee can become biased when a problem arises. Sometimes it is good to have an outside observer come up with new ideas and solutions.

24-hour operations

By outsourcing services, you have the opportunity to find a company with operations in a different time zone than yours. This may sound complicated, but the truth is that it could allow your business to operate on a 24-hour basis. Likewise, there are companies with a presence in several countries, which could allow them to be available to help you without any time restrictions.

Access to a larger pool of talents

In addition to being experts in the field, these outsourcing companies have a recruitment process specialized in the skills of their core business. As their line of business is to provide expert staff, they have different specialists at your disposal.

Implement new technologies quickly

Having access to the latest technology equipment becomes quite unattainable, at least in the short term, especially when you are a small or medium business. In addition, it must be taken into account that machinery may be something that we do not necessarily need on a day-to-day basis, and investing in them would not have a valid purpose. There is no need to spend thousands of dollars on something that specialized companies already have.

Compliance and security

When you work with IT companies full-time, they are likely to share the risks of service interruption with you and provide you with data security and disaster recovery services. They are more up-to-date on the latest industry trends and they must have different protocols to avoid and deal with these types of problems. In addition, as they are providing a service, you can have a greater guarantee in terms of delivery dates.

Less complex organizational chart

While it is true that some areas are essential within a company depending on its field, others can add more complexity to the organization of the company. The process can become cumbersome and take longer than just hiring a specialized company. One great benefit of the latter is that you are fully entitled to receive the work within a deadline.

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Conclusion

We have analyzed different benefits that IT outsourcing can have for your company. The majority of these will vary depending on the industry and size of your business. In addition, you should bear in mind that there are different types of outsourcing, and each has its advantages and disadvantages. Just keep in mind that digital transformation has been accelerating the adoption of outsourcing as a strategy, and it can be used as one of your best weapons to make your company more competitive.