CHAPTER 19: OUTSOURCING IN THE 21ST CENTURY

CHAPTER 19: OUTSOURCING IN THE 21^ST CENTURY

Assalamualaikum..and helloooooooo everyone... ! How are u guys..?feeling good..? Today I would like to write new post of my IT subject which is Outsourcing in the 21st century.. and, and, and this is the last chapter for this subject. Which means that..final exam is around the corner..! Now, lets check it out.. :)

           

            OUTSOURCING PROJECTS

·         Insourcing (in-house-development) – a common approach using the professional expertise within an organization to develop and maintain the organization's information technology systems

·         Outsourcing – an arrangement by which one organization provides a service or services for another organization that chooses not to perform them in-house

            While, this picture below show the reasons companies outsorce

·         Onshore outsourcing – engaging another company within the same country for services

·         Nearshore outsourcing – contracting an outsourcing arrangement with a company in a nearby country

·         Offshore outsourcing – using organizations from developing countries to write code and develop systems

·         Factors driving outsourcing growth include:

–     Core competencies

–     Financial savings

–     Rapid growth

–     Industry changes

–     The Internet

–     Globalization

·         Most organizations outsource their non core business functions, such as payroll and IT

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OUTSOURCING BENEFITS

·         Outsourcing benefits include:

–     Increased quality and efficiency

–     Reduced operating expenses

–     Outsourcing non-core processes

–     Reduced exposure to risk

–     Economies of scale, expertise, and best practices

–     Access to advanced technologies

–     Increased flexibility

–     Avoid costly outlay of capital funds

–     Reduced headcount and associated overhead expense

–     Reduced time to market for products or services

OUTSOURCING CHALLENGES

·         Outsourcing challenges include

–     Contract length

1.      Difficulties in getting out of a contract

2.      Problems in foreseeing future needs

3.      Problems in reforming an internal IT department after the contract is finished

–     Competitive edge

–     Confidentiality

–     Scope definition

Thank you sooo much for reading my blog.. I hope you like it.. :)