The Top 5 Benefits of IT Outsourcing
IT outsourcing is a widespread practice of using external development service providers to perform IT-enabled tasks and handle an organization’s technology operations. Among the most commonly outsourced services in IT are the following:
- Software development
- Website development
- Website maintenance
- Technical support
- Database development and management
How big is the current global IT outsourcing market? The size of the global IT outsourcing (ITO) market was valued at $556.67 billion in 2020, accounting for 77.75% of the overall market. The ITO market has an estimated CARG of 7.7%. On that basis, the market would be valued at around $806.63 billion by 2025.
There are numerous reasons why companies opt for IT outsourcing rather than in-house development. Below we will explain why outsourcing is an excellent strategic tool.
A vast pool of talented specialists
Companies now can easily access experienced specialists and rare resources from all over the world within minutes. Hiring an outsourced IT team has the added benefit of streamlining the level of your expertise. It won’t be limited to the skills of your in-house employees only — external experts may offer a wide range of applied knowledge with experience in hardware, software, technical support, etc. Moreover, the cost of working with third-party vendors is approximately the same as bringing similarly-skilled professionals in-house.
Focus on core business activities
Delegating effectively saves time and helps you as a leader to focus on higher-level tasks. IT outsourcing, in this case, may be crucial for small to medium companies that have not got a wide array of IT expertise yet. Thus, instead of overloading your employees with not yet familiar tasks, you can entrust them with experts who possess experience in this particular industry.
As your business grows, so do your IT needs. Obviously, when you expand your staff, especially within IT, you may face various challenges, primarily with time and cost. With an external development team, you are able to receive only the services you require at a given period of time and gradually add extra experience down the road. Such a pay-as-you-go format enables you to build, test, deploy, run, update, and scale applications more quickly and cost-efficiently than budgeting your internal resources on a regular basis.
Cost-effectiveness is one of the major advantages of IT outsourcing. According to Deloitte’s research, 59% of companies opt for outsourcing because it’s a great way to save money. First of all, delegating tasks to a third-party company eliminates the need for keeping a long-term staff and training new employees (as you may know, these procedures require much effort and high investment). Also, external experts provide their own IT infrastructure, so you can reduce the amount of in-house hardware and software to support your IT needs.
Well-organized outsourcing process
As a rule, seasoned outsourcing companies fully realize the importance of timely deliveries and quality work done. Therefore, companies that offer IT outsourcing services know how to maintain an interrupted workflow and manage potential risks.
It would be difficult to argue the fact that outsourcing is a worthwhile alternative to in-house software development. However, to recoup your investment, you still need to find the right company.
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