Should you insource or outsource your IT requirements?

IT company


Information Technology (IT) makes extensive use of computers and software to manage information effectively.

According to a leading IT company in South Africa, ASG, to ensure that modern IT departments can effectively perform complex functions expected of them, it is crucial to have a dedicated team of employees that understand their roles and who can work together to ensure that all IT requirements are not only met but exceeded.

Why is Outsourcing a good option?

As result of IT being a technical field that requires specific skills, it may be difficult for non-technology businesses to maintain a large department that will cover each IT skill to a high level of competency.

Outsourcing of IT providers may provide highly skilled experts on any topic and it can provide a table of skills that are better developed. Outsourced providers can address issues faced with availability, by responding to requests 24/7 as opposed to internal staff that may not be able to respond until the next working day.

Cost is a large advantage of outsourcing IT services as Internal IT teams are unlikely to operate at maximum capacity all the time, however, large, outsourced IT providers tend to maximise efficiency as result of their scale while providers that have been outsourced could offer more retained knowledge that could assist in keeping costs to a minimum.

Why does Insourcing make more sense?

The largest disadvantage associated without outsourcing resides in institutional knowledge. Some IT activities and tasks are routine and involves planning and strategy.

Internal staff have a clearer understanding of an organisation’s purpose and they know what the organisation’s unique requirements are. Even though outsourced providers may gain this understanding, it takes time and the translation involved with institutional knowledge to external partners can be flawed and costly.

Many companies also feel that having an internal team can override cost efficiencies involved with outsourcing. In addition, management teams can feel that keeping a certain level of internal knowledge presents many benefits.

Read more: Business process outsourcing sector helps SA spring into jobs growth

How to choose between insourcing and outsourcing.

The choice between these two is not easy and there is no one-size-fits-all solution. Instead, organisations are urged to weigh the pros and cons of both insourcing and outsourcing specific to their operations. This will help the organisation determine which one will suit their needs and expectations better.

Some considerations involved with choosing between insourcing and outsourcing include:

  • The size of the operation – global multinational companies have a chance at building a competent IT team which can cover all their IT requirements; however, smaller, and medium businesses may struggle to build such teams and may have to rely on outsourcing.
  • Business processes – if the organisation operates industry standard processes that are well-understood and can easily handle technology, outsourced providers may be able to get up to speed quickly.
  • Security and client preferences – there are some organisations, especially those in a regulated industry, who must consider the nature of their operations and industry as security is a vital factor that must be ensured.

Choosing between insourcing and outsourcing has several factors that need to be considered. If no decision has been made, feel free to contact ASG’s team (+27 86 100 5179) who can provide more clarity on making the best decision.

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