IT Outsourcing Advantages and Disadvantages


Outsourcing is one of the basic strategies to reduce the cost of an organization’s services. Beyond software projects outsourcing, a service provided by SOJECT, IT outsourcing is one of this offshoring that comes in various forms with many advantages discussed below.

Learn more about software project outsourcing: Outsourcing of software Projects.

What does outsourcing IT service means?

Outsourcing IT services means using external service providers to accomplish some or all of the IT functions required by an organization or job. IT outsourcing providers can take responsibility for all the services needed as complete support, which is known as full management service, or they may continue to provide needed services partially.

What is the IT department?

The IT department is a section with complex technologies that host various hardware, software, and computer networks. These technologies make you capable of setting and executing professional workflows and operations; Such as financial and accounting processes, customer relationship management, sending and receiving emails, and producing and publishing documents.

The organization’s success depends on its experts’ knowledge to correctly and efficiently use these facilities and authorities. For example, sending and receiving emails to communicate with customers, employees, partners, and vendors is necessary for your business. If your IT staff does not perform these crucial tasks properly, you should not expect good results in your industry.

Now the question is, given the heavy and vital responsibility of implementing IT processes, can a small or medium-sized business take on all these responsibilities alone?

This is where companies think about outsourcing IT services because the appropriate implementation of IT services is only possible when the businesses disburse lots of money discovering talents and building infrastructure. In addition to financial capital, you need a lot of times. Training IT staff, maintenance and upkeep of department equipment, as well as keeping technology up to date, are activities that are difficult and unattainable for most small or medium-sized businesses. You should note that It is different from software project outsourcing.

That’s why IT service outsourcing is reasonable and cost-effective for most start-ups. In this section, we look at some of the benefits of this kind of outsourcing.

IT Outsourcing Advantages

Control and reduce costs

When you outsource the IT department’s tasks to a reputable supplier, you can pay a monthly fee that helps you control the business costs and expenses.  In this case, you will have complete information about payments, and with proper management, you can avoid monthly fluctuations in costs.

Besides saving money, you can also benefit from a third-party service provider’s experience and expertise. That means you can kill two (several) birds with just one stone! Setting up an IT department requires spending a lot of money. IT professionals must have opportunities to improve their expertise and knowledge and have a satisfying income.

IT Service Management Organizations (MSPs) usually provide cloud-based hosting services; this means that you can rent different hardware such as a server or even ask the IT outsourced supplier to set up the system you need somewhere outside of your workplace and allow you to monitor it continually.

The total capital that you require for information technology is significantly reduced by outsourcing IT services. All hardware has an expiration date on which their service life ends; In this case, you must replace that hardware. Cloud hosting services allow your organization to anticipate and control these costs.

Focus on business

Your organization may operate in different fields such as law, engineering, or construction. It is clear that you choose your activity zone based on your abilities and expertise, not based on information technology!

Every company or organization has resources and environmental restrictions. Outsourcing IT services help you use those resources in a way that works best for you. By outsourcing IT to an expert institution, your will not waste your resources on complex IT issues, and you can focus on areas that ensure your growth and success.

Access to the latest technology versions

Outsourcing IT services to IT service management organizations (MSPs) will bring the most up-to-date knowledge and experience into your organization regularly.  You have access to new technologies and information that you were previously unaware of, as well as technologies and tools that you have not had before. We can use approved processes in performance, documentation, and more structured methods among the various tools and technologies.

In addition, an IT service management organization selects its engineers through a recruitment exam when hiring. These organizations regularly train their employees and continuously update their knowledge and expertise with a regular evaluation.

These centers have different IT specialists with unique skills and talents and thus cover different situations well. If your organization hires employees for the IT department, it is clear that their skills is limited to their expertise.

Supervision of information technology; 24 hours a day, seven days a week, 365 days a year!

Even if you have several knowledgeable IT professionals among your employees, you can not force them to monitor your organization’s IT 24 hours a day, seven days a week.

Having sufficient experience, skills, and tools, the service unit, beyond anticipating possible problems in the information technology environment, prevents them from occurring. If a problem occurs despite all the precautions, it will fix it before the system crashes.

Furthermore, the centers to which you outsource your IT activities can provide you with useful tips and instructions for necessary future updates so that the system does not crash.

Are your servers older than three years? Are you using an operating system that its manufacturer no longer supports? IT outsourcing companies can oversee day-to-day processes and operations such as software updates and repairs, antivirus equipment updates, data backups, and auditing and controlling the organization’s inventory.

Risk reduction

IT outsourcing companies update the IT environment quickly and seamlessly. That’s because these institutions have fully automated the operation process using specialized equipment and tools. They minimize the potential of problematic consequences in the organization by ensuring that backups work correctly.

IT outsourcing companies prepare themselves for unpredictable conditions; For example, sometimes the hardware and backup software performance may get disrupted, databases and software crash, and viruses and spyware access your system. Under these circumstances, the organization can act consciously and prevent system malfunctions quickly.

Your company’s in-house IT staff may not respond appropriately to the situation and handle the problem as quickly as expected. Thus, system downtime gets prolonged, leads to severely degrading the system’s productivity and efficiency.

You can use IT outsourcing organizations’ expertise and knowledge to minimize the possibility of wrong decisions resulting from insufficient knowledge and technical experience.

Strategic consulting for future IT development

IT outsourcing organizations usually have a history of cooperation with various industries and are familiar with the world’s latest technologies. Thus, these companies may be the best advisors for your business information technology’s future actions. You may want to expand your business or decide to enter new markets. In this situation, IT outsourcing organizations monitor your business’s growth and identify the future needs of IT.

Technology is evolving and growing continually. Thus, identifying a business’s future needs and designing practical solutions to address them is not an easy task. Working with an IT outsourcing company predicts future instabilities and changes.

Barriers to IT Service Outsourcing

IT outsourcing transfers services from an organization’s computer center, telecommunications networks, or application development to a supplier outside the organization.

Outsourcing IT services has its cons and pros, the main advantages of which,as we said , are financial, technical, human resources, management, quality, and flexibility.

In contrast, there are many limitations to outsourcing. Also, some people believe the benefits of IT outsourcing are unclear or long-term. Some of the disadvantages of IT outsourcing are barriers related to human resources, environmental, technological, process and product, organizational, and obstacles related to contracts and legal cases:

Loss of managerial control

When you outsource part of your company to another organization, you no longer have control over that part. This issue becomes important when you want to implement your standards in all aspects of the company. In this case, the company you outsourced your IT services does not follow your standards. What every company is looking for is profitability. Therefore, you should not expect your interests and standards to be strictly adhered to by a third party company.

Potential risks for your business security and secrets

 Confidentiality is vital for some businesses – especially those related to people’s health. In this case, outsourcing IT services to another company may conflict with these standards. When you outsource your company’s IT activities, you are giving third parties access to your clients’ information. If the information is leaked, this can cause deteriorate your reputation. On the other hand, if your company has a specific formula for manufacturing a product or has information that its disclosure may be detrimental to your business, it is better to do IT activities within your company.


Quality problems

The company you have a contract offers specific services for a fee. In this situation, the way they may take to increase their profit is to reduce the quality of services. Although many reputable companies do not do this, you may receive low-quality services if you are not careful to choose an IT outsourcing company. On the other hand, because your contract terms are fixed, any change in your business will require you to pay more, which will slow down your performance in your industry.

You have tied your business to the financial strength of another company.

By outsourcing IT services, you are actually finding a partner whose financial strength affects your work. If the third party company goes bankrupt or has any financial problems or disgrace, you also lose.

 Be careful in choosing outsourcing companies and try not to entrust your IT services to anyone.

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