Outsourcing is the driving force of everything IT. Common thought is that IT outsourcing saves a company both time and money. And it allows companies to choose from a wider pool of expertise than they can expect from their in-house IT talent. Outsourcing is a win-win from all sides.

The survey, and reviewing the findings

At a 2012 conference InfoSecurity Europe, Liberman Software surveyed a group of IT professionals. It found that 71% of businesses outsource their IT needs, which is a “significant portion.” Businesses can see the value of outsourcing as a cost-cutting measure. However the results from a new survey suggest that perception has changed , and we’ll now review their findings;

  • 42%, that almost half of the survey respondents reported that outsourced projects ended up costing more than they had originally planned
  • 16 % said the costs were “significantly more”

We can’t assume that it was more expensive than hiring, training, and retaining in-house talent for the same project. But we do acknowledge it reflects on IT outsourcing, in a poor light.

While businesses do worry about the cost of projects, of more concern is quality and trust.

  • 33% a third surveyed were convinced that the quality of work was of a lower standard than that of their in-house employees.
  • 64% felt that their outsourcing partners invent work to artificially inflate costs.

If a company is questioning both the quality and integrity of a third-party company, it is difficult to build a good working relationship.

Philip Lieberman, President and CEO of Lieberman, says “The fact that trust in the quality of work is being eroded is a worrying trend but, for me, but the thought that work is being manufactured to inflate fees is even more of a concern.”

The need for Outsourcing, it’s worth it!

Some projects need the input of an outsourced IT consultants for their success, as they require a specified skill set. Companies need to hire the best talent available for the job. And secondly, small and medium sized businesses lack the budget to hire IT staff capable of managing all IT projects. Outsourcing is a win-win, a good solution. It’s worth it.

Importantly, even though the survey shows some concerns with outsourcing your IT, it doesn’t mean you should avoid outsourcing altogether. It’s more beneficial to research IT companies, get some referrals, do your due-diligence and build a relationship with a company known for its quality and integrity. In other words, make sure they are reliable and trustworthy, cost isn’t everything. It’s more important that they take the time to understand your IT needs and are transparent in their dealings.

Consequently, if you’re having to micro-manage your IT partner, maybe you should look at finding a new one. They need to save your time, not waste it.

Outsourcing from Overseas

What if you’re concerned with the costs?  You may be tempted to choose an outsourced IT from outside Australia. Costs may look cheap at first but can be deceiving. We’re yet to see an off-shore website developed for a cheaper price than a locally developed product. If we take into consideration the project being delivered, achieving ALL its promises successfully.

Saving money in the short term could cost you more in the long run. For example, we’ve found the following to be the case;

  • built poorly, the website requires regular maintenance and fixes
  • the website is not as scalable and often includes redundant codes. Off-shore web applications are known for using many different developers on the same project, who are not working together. They end up creating a mismatch or repetition of code.
  • compared with local developments, the website takes such a long time to build
  • more- often than not, the website fails to meet the requirements of the project – resulting in another local developer to fix
  • the solution is generally insecure and has many holes in the security that leave the business open to hackers.
  • the total costs end up being similar- to what it would be to design and develop in-house in Australia.

You only need look at the overseas company website as a testimony to their web development abilities. Firstly, they have poor coding, and secondly coding errors. In addition, they often use outdated solutions and furthermore provide little or no support of their advertised credentials.

Our experience tells us that off-shoring IT development is not always the best or even the most cost-effective solution.

Cost isn’t everything, remember, often the cheapest solution is cheaper for a reason. You get what you pay for.

Outsourcing your IT projects to a reputable, reliable and trustworthy local company are definitely- worth it.