IT outsourcing is a globalised movement and one of the leading remote working careers in the world. Businesses have now noticed the benefits of applying outsourced services to their company.

Before you get excited and fully commit yourself to the wonderful world of outsourcing, you should know a few things. There are so many new terms that you’ll have to know, such as the new hybrid outsourcing called flexisourcing.

There are also the pros, cons, benefits, and disadvantages to think about before you begin your journey. While outsourcing does sound enticing, keep in mind that this process isn’t for every business.

So how do you know all about these things? Simple. Below you’ll find we have gathered all the basic information you need to begin your outsourcing journey!

What is IT Outsourcing?

Before we discuss anything we should first define what the term IT outsourcing defines. When a company requires efficiency but doesn’t have the budget to cover an expensive in-house team, many turn to outsourcing.

This is because outsourcing refers to hiring talents sourced by another company with specialties. These outsourcing types can lead from customer service representatives, digital marketing, and IT support.

The most widely utilised outsourcing is IT. Talented professionals with a penchant for IT-related talents can come from everywhere. Getting fair wages while still completing effective service for their clients is a world-renowned fact. 

4 Different types of IT Outsourcing

There are four very different but also similar types of outsourcing you can choose from. These four variants each have their benefits and disadvantages that can turn the tide of any business suitable to their kind. 

Offshore

The first type of outsourcing is called offshore. Thanks to the digital age, remote workers can be hired anywhere across the globe. That means an IT outsourcing company can work for you even when they live in a different timezone and country. 

An offshore means an outsourced company that comes from a different country and timezone. A prime example of that is an Australian company hiring an outsourced service all the way from Europe. Offshore costs less compared to the others. 

Nearshore

Another type is nearshore. Nearshore is similar to offshore service in a way that it’s based in a different country. The difference is that nearshore companies have similar time zones. While it’s slightly more expensive than offshore, this allows productivity between in-house and outsourced employees.

An example of this is Australian companies hiring IT outsourcing in the Philippines. The benefits of nearshore are that the time zones allow close collaboration, faster response times, and–if possible–similar communication styles depending on the country’s culture.

Onshore

Another outsourcing type is onshore outsourcing. It’s the most expensive type of outsourcing but it also has some exceptional benefits. Unlike offshore or nearshore, companies outsource services within the same country.

The same culture, and the same language, and could travel to the company’s base. Unfortunately, this does mean that your company likely creates more costs and requirements in comparison to offshore, nearshore, or flexisourcing.

Flexisourcing

The newest type of outsourcing is called flexisourcing. IT outsourcing has long since been about offshore, nearshore, and onshore. Since then hybrid outsourcing types have come from it to optimise progress and improve success further. 

A big game changer in hybrid outsourcing is flexisourcing which gives you the right to hire talents from a third-party provider for a short term. The uniqueness of flexisourcing comes from the fact that talent skill sets aren’t exclusive to one client. That means that these talents can take on other projects. 

Furthermore, flexisourcing’s payment method is discussed by both parties. That means you can use flat rates, per hour, or projects. Additionally, the goal of flexisourcing is to allow clients to pick their staff, and manage them.

When it comes to flexisourcing vs outsourcing, think of flexisourcing as its modified version that focuses on agile methodology.

Pros and Cons of IT Outsourcing

Pros of IT Outsourcing 

Now that we know their variants, it’s time to learn the benefits of IT outsourcing. There are many key benefits you can utilise with outsourcing. Read through these three major pros you can receive when utilising outsourcing.

Cost Efficiency

One of the most common advantages of outsourcing that everyone knows is its cost-efficiency. In comparison to hiring in-house employees, it gets easier to temporarily hire expert services at a fair price while working remotely.

Furthermore, it reduces costs on work equipment, training programs, and other labour costs involved in hiring in-house employees.

This is why startups tend to prioritise their core business needs with their in-house employees while hiring from third parties to focus on maintenance, development, and other IT outsourcing benefits.

Access to Expertise

Speaking of third parties, outsourced employees come from all around the world. The problem with hiring in-house employees takes time, effort, and a lot of searching. However, when you choose to commit to an outsourcing company you find yourself open to a whole new avenue of talent.

This avenue gives you access to all the rare specialists and experts that you may have been racking your brain trying to find. Even better, some so many remote workers are experienced professionals.

Not only do you get these rare IT outsourcing services, but you also expand your company’s diversity.

Focus on Core Business

Core businesses with continuous processing are the key to growth. However, if in-house employees are constantly bombarded and delayed due to maintenance issues, setbacks, and development requirements. 

The benefit of outsourcing is that your in-house employees can focus on the core parts of your business’s growth without compromising the stability of your other projects that require their attention. 

Professionals used to being hired through IT outsourcing jobs can adapt well to any company environment. As they quickly adjust to your requirements and needs your mind can rest easy from any potential issues and focus on growing your brand. 

Cons of IT Outsourcing

Just as there are benefits there are also disadvantages to outsourcing. The good news is that we have solutions to these problems as well. Below you’ll find the cons of outsourcing your IT and how to prevent these issues.

Potential Communication Issues

Many issues come from miscommunication. It could come from a bad joke, a misunderstanding, and even delays in work. When working with outsourced employees these communication errors double their increase.

Why? It’s because of the cultural differences between one another. What could be considered a joke for one employee becomes an insult to another. It’s one of the biggest IT outsourcing risks that could become harmful to your brand’s identity.

To prevent these issues the best thing to do is to have diversity and open communication. Create an official channel for direct communication with your third-party employees and be mindful of the different cultures.

Quality Control Challenges

Another big issue that outsourcing clients face is the challenges in quality control. Most of the time, it’s the outsourced talent that controls the quality and maintenance of your project. This creates a lack of control on the client’s end.

Flexisourcing is a great option for this issue. Direct communication between the talent and the employer is possible with training on your company’s processing involved. Furthermore, other solutions include effective communication and transparency before committing to each other’s partnership plans.

Security Risks 

Security is also a big issue during outsourcing talents. Trust is heavily required when passing over your company’s projects with your data vulnerable to breaching and other cybercriminal activities. 

Even more concerning is the many enticing offers from thousands of outsourcing companies in the world. Who do you trust? And which one understands the need for enhanced cybersecurity?

Researching the IT outsourcing market is crucial to prevent any cybersecurity errors. Outsourcing companies with a respectable reputation will often have non-disclosure agreements, require multi-factor authentication (MFA) for your data, and report regularly on their activities.  

Examples of Successful IT Outsourcing

Many successful companies have reached success thanks to their partnership with outsourcing companies. A big-name brand like Google might not be the first one that comes to your mind. But the truth is that they still use outsourced services.

Google still utilises outsourcing services to manage the gigantic company that it has grown today. With almost every branch available on all continents, complicated processing and maintenance are inevitably needed.

Slack is also a popular company that utilises outsourcing. What started as a 4-man team hired some great outsourced employees to redesign their logo, website, and application. Today, Slack has become one of the prime IT outsourcing examples, proving that your brand can create its best version of itself by starting small and acquiring support from others.

How to Decide if IT Outsourcing is Right for Your Business?

Whether or not you find yourself enticed by the benefits of outsourcing, you still need to double-check if you need it. There are many circumstances wherein a business invests in outsourced services when they didn’t need them in the first place. The result of that ended up with capital funding wasted. 

To ensure your brand requires outsourced services, think about these four key factors: budget, expertise, and technology. First, ensure that your budget can afford to hire outsourced services. 

Depending on the quality of work you require, outsourcing can become reasonable, pricey, or cost-efficient. Another thing to consider is how difficult your project is to find out how much outsourcing is required. 

The last step is to ensure whether or not your company has the required standards of technology to maintain the highest optimisation possible. 

Conclusion

We hope you enjoyed learning about IT outsourcing. Now that you have a basic idea of what it is, maybe you can decide on whether or not to invest in this for your brand. Should you be interested in exploring more solutions provided by outsourced IT and want more information, feel free to contact us today for a consultation!