- Cost reduction and cost structure optimization
- Immediate access to technical staff
- Immediate access to technology
- Immediate access to business domain expertise
- Focus on core competencies
- Speed up time-to-market cycle
- Flexibility and scalability
- 24 hours work cycle
- Quality improvements
Driver #1 Lower Total Cost of Ownership IT Outsourcing has long been considered a way to reduce costs. Service providers like us develop the people, methodologies, and repeatable processes to deliver the same or higher quality services less expensively than any corporation. Through outsourcing of non-core IT applications, a firm can easily realize cost savings of 15 percent with the number jumping up over 30 percent if an offshore outsourcing approach is employed. An outsourcing relationship also enables a company to get a handle on their true costs and therefore, better control them.
Driver # 2 Improved Focus on Core Competencies The noted American management guru Tom Peters put it best when he said: “Do what you do best and outsource the rest.” We adopt this simple yet compelling idea which has been virtually embraced by every industry, including retail market. Thus global IT outsourcing is growing in a robust manner.
Driver #3: Talent Shortage Epidemic It is no secret that the world has a major shortage of skilled technicians. The problem is reaching epidemic proportions in the Asian pacific rim. US Congress has just created new legislation that increases the number of skilled technicians that companies can “import” from other countries to help ease the situation.
Driver #4: Rapid Pace of Technological Change As corporations struggle to fill a huge number of open technology positions in their IT departments, they are increasingly relying on outside IT partners to help them solve this challenge. The phrase “Internet speed” is rapidly becoming a clich, but the reality is that technology solutions are now delivered in weeks not months. This “need for speed” is driving much of today’s push towards IT outsourcing. CIO’s and internal IT teams can’t afford to invest in developing or reengineering internal processes to meet new customer demands.
The solution is to “plug and play” an outsourcing service provider who has already developed and deployed the solution many times over. This enables corporations to stay closer to the “next thing.”
Offshore Approach Gaining Favor While many corporations are looking for various forms of IT outsourcing, the offshore approach is growing even faster…Why? There are a couple of reasons.
First, the world is truly getting smaller. The Internet means your IT partners can be in the next building or the next continent. In fact, with partners in various time zones, you can extend and execute a virtual round-the-clock workday
Once upon, CEO’s and CIO’s looked for offshore IT providers at low-cost. And often low-quality programming skills are the resultant. The issue is no more. Now some of the best technology thoughts and practices are delivered from the firms that operate in India, Israel, and Russia.
Offshore Provides Sophisticated Offerings: In 1980s, the basic programming and application maintenance was the main service offered by IT firms with offshore operations. Afterwards, this is evolved into higher-end consulting, operations outsourcing and implementation services. And today, the reach is at web and wireless integration services, call center management, industry-specific application services,etc.. sasi