The Advantages and Disadvantages of Outsourcing IT

by July 19, 2020

IT Outsourcing

Growing companies are often challenged by the question of how and when they should hire for certain positions and skill sets within their organizations. This then leads to the question of whether or not it’s the best choice to hire an in-house team of employees or if it’s a wiser option to partner with an outsourcing company as a virtual team.

Outsourcing a wide array of everyday business functions has become an incredibly common practice for companies all over the globe. This is due to a variety of reasons, including budget limitations, time constraints, and general operation pressures. The outsourcing of IT is one of the most notable areas to outsource.

As technology has advanced and innovated over time, the need for skills professionals with wide ranges of expertise and experience has grown exponentially. IT outsourcing is the solution to this need. By utilizing external providers, companies gain access to a wide variety of solutions for their everyday needs. Some businesses choose to outsource the entirety of the IT staff or department while others choose to leverage these companies as skilled consultants to complement their current internal resources.

 

Weighing the Pros and Cons of IT Outsourcing

There are both advantages and disadvantages associated with outsourcing IT. If a company is looking to outsource their information technology needs, it’s important to take the time to consider the pros and cons. This is the only way to decide whether or not IT outsourcing is the best choice for a particular company. Below are just a few examples of the pros and cons of choosing to work with an outsourced IT team.

 

The Pros 

  • Extended Resources and Skill Sets – If a business chooses to hire an in-house team to meet their IT needs, the knowledge bases and schedules of those few team members will restrict the company. Outsourcing to a team of a trusted IT provider allows companies to benefit from both availability and additional skills. Experienced outsourcing teams continuously train and hire for the latest technologies and unique skills on the market to meet the needs of their customers. To hire for each required technology in-house would cost an organization an astronomical amount.
  • Scalability – Additionally, IT outsourcing allows companies to scale as their workload or projects require. Should businesses slow down, their outsourcing team is easily reduced. If something requires a quick turnaround or for a unique project, additional team members can jump on the team.
  • Security Benefits – Outsourced IT providers train employees to make the best security recommendations depending on the needs of the individual business at hand. They understand which technologies are available, their benefits, and how to implement these advanced tools to best protect the organization.

Most IT providers also provide round-the-clock remote monitoring services to ensure the protection of everything related to the project is running as smoothly as it should be, no matter the time. This is typically impossible for an in-house team. Should an emergency occur, an outsourced IT provider will also be able to provide an expert to help get things repaired and up running as soon as possible.

  • Reduced and Predictable Costs – While an in-house team may seem like a predictable cost, factors such as sick leave, vacation time, employee turnover, hardware, and software must all be factored into the price. Outsourced IT teams require a fixed cost on a regular basis for the most part. As outsourcing also means no need for health insurance, employment taxes, training, and recruitment for these positions, costs are also lower than they would be hiring for and retaining in-house employees.
  • Focus – It isn’t uncommon for many employees to wear many different hats within an organization, especially in the tech world. Outsourcing IT needs means that those IT specialists working in-house are able to focus on their core tasks while knowing that the outsourcing team has their back.

 

The Cons

  • Less Control – A loss of control over IT functions is something that some companies cite as problematic when it comes to IT outsourcing. However, this is easily managed with improved communication, project management, and monitoring.
  • Communication – Depending on the location of the outsourced team, communication can sometimes be a problem in terms of timing and language barriers. As long as hiring companies set up time requirements ahead of time, decide on the language used by all parties involved, and establish appropriate communication methods, this problem can be solved before it even begins.
  • Lack of Support In-Office – Businesses are commonly reluctant to switch to an outsourcing business model as they feel comfortable having their IT employees being in the office with them. It may be convenient to have someone physically there, but it isn’t always the most effective route in terms of cost and time.

While IT outsourcing does have some disadvantages associated with it, the advantages far outweigh any potential problems. The outsourcing of IT provides businesses with the opportunity to focus on their core functions, reduced costs, additional security benefits, as well as access to skills they may not have otherwise been able to tap into. As long as communication and management are effectively handled from the very beginning, an outsourcing relationship is an incredibly beneficial one.