Articles | September 26, 2019
Why is it worth outsourcing IT services?
Outsourcing is more than an option to be taken into account. It has become second nature for the vast majority of IT companies. It is not only a question of the undeniable growth of the outsourcing market, but rather something more significant. We are witnessing the evolution of this sector.
Of course, some things remain the same: optimization is expected and even taken for granted. What’s more, customers seek innovation, and wish to be actively supported in their quest to work smarter and to gain a competitive advantage.
Read also: Effective communication in IT outsourcing
8 advantages of IT outsourcing
Let’s go through the benefits of outsourcing in IT – starting with the rather obvious ones, like the cost effectiveness factor, to signaling changes in this area, such as customers’ expectations of having an input into innovation.
- Increased efficiency. You may gain access to new capabilities & intellectual capital. Sometimes you need a specific level of expertise, which is not otherwise needed regularly. In that case, outsourcing can provide you with access to IT specialists that would be available for a particular period of time.
- Delighting your customers. With access to best-in-class support, you can turn it into high-quality services or products for your customers.
- Equipment and tools. Your contractor will most probably use the best quality and most up-to-date software and equipment to provide services, which means that you don’t have to invest in software or hardware tools and still get the best possible results provided by an outsourcing company which specializes in that area.
- Improved focus on your business. IT outsourcing allows you to stay focused on your core offer. You can concentrate on strategy and the most important tasks. Moreover, if you are a start-up company and you want to be in line with lean startup methodology – as long as it’s not related to your unique value proposition – don’t hire, use external resources.
- Better risk management. You can minimize the risk of not completing the task to the best possible standard, especially when your staff have no significant experience in that area.
- Overcoming formal limitations. If you have an internal limitation related to headcount, outsourcing can help you to be in line with that, yet still complete the project.
- Competitive edge. IT outsourcing can provide you with new ways to operate more efficiently and effectively. When designed as strategic outsourcing, it may help your company to leap over the technology chasm.
- Cost-cutting tools. Instead of hiring a new in-house specialist, you can take advantage of the time-and-materials model, thanks to which you reduce project costs as you pay only for work that has been carried out. This model allows you to adjust costs in a flexible manner according to customer requirements – which may change during the project.
Speaking of innovation, according to The Deloitte Global Outsourcing Survey 2018, organizations are proactively looking for innovation opportunities – and the word “proactively” is the key. There are a few levers that help you to reach the expected standards. The main three are listed below – all of them have seen a twofold increase in the last two years.
- Increasing the scope of orders when the supplier brings elements of innovation to the services provided.
- Innovation as a factor which is formally included in the contract.
- Supplier remuneration is dependent on the level of innovation provided.
IT outsourcing is not only a remedy when you need additional resources or expertise. It may also help your company to unlock its business potential. Don’t limit your expectations regarding innovation to in-house initiatives. Your IT vendor may also bring ideas that could provide you with competitive differentiation to the table.