Pros and Cons of IT Outsourcing

PROS AND CONS OF IT OUTSOURCING 4

Prosand Cons of IT Outsourcing

Prosand Cons of IT Outsourcing

IToutsourcing is a vital business process, as it is relevant forbusinesses that heavily use information technology applications. Inthe contemporary business environment, IT firms also engage indesign, control, and operation activities yet they are supposed toconcentrate on a particular process to derive maximum value from it(Miranda, 2015). Hence, the IT outsourcing aids in managing andsupporting the firm through handling other processes.

Pros

ITfirms have the time to concentrate on the core competencies ratherthan spread them on many processes. The firm will also reduce costsbecause they will have the opportunity to use advanced technology andthe time to attend to other value-addition activities.

Cutson costs and improves quality of services: The existing businessenvironment in the IT market is prone to very stiff competition. They have ensure that robust cost cutting and savings through suchefforts as staff reduction. Outsourcing vendors aid in cost cuttingthrough:

  1. They have leaner overhead costs than the main company.

  2. They most operate in areas where the cost of data is low.

  3. They ensure that their workmanship is of high standards because it is a perquisite for future outsourcing contracts.

  4. The purchase hardware and software in bulk

Thecompany can hire and lay off employee without tarnishing itsreputation. Hence, the company can use outsourcing to buffer theexiting workforce through the strong relationship it creates betweenthe later and outsourced employees.

Cons

IToutsourcing has the potential to cause loss of control to theoutsourcing business.

Vendorsor subcontractors may not disclose the savings they get from theprocess.

Reference

Miranda,K. (2015). Pros and Cons of Outsourcing IT. Chron.Availableat

http://smallbusiness.chron.com/pros-cons-outsourcing-it-1773.html