Profit From The Outsourcing Rebirth After The Downturn

Cost cutting in the area of software development. Image credits: stock.xchngBefore the downturn, outsourcing was becoming more and more popular mainly thanks to unrestricted access to resources and knowledge of specific domains. Partial reduction of incurred costs was another reason for it and it turned out to be the main reason during the downturn. Nowadays, outsourcing seems to start increasing again. Considering your IT outsourcing providers as a business partners could additionally speed up your recovery once the market starts growing again.

Invest with focus on the result

Is there any point to give up the business strategy that is successful for your company? Needless to say, more favorably would be to retain an outsourcing strategy that works for you. During the past years outsourcers drew a conclusion from the lesson they were given by the downturn. Their investments seemed to be more focused on the result they are going to achieve, which is rather reasonable and healthy thinking. During the downturn firms were forced to put their IT budgetary allocation on hold, however, now they are more willing to renew their spending on IT projects, calling them “discretionary spending”.

Make use of the higher efficiency of offshore teams

Duke Offshoring Research Network’s (ORN) fifth annual report on offshoring trends, shows us doubled amount of U.S. companies collaborating with IT outsourcing providers and it only regards to years 2005 – 2008. Duke concluded that offshore development teams are more efficient and that’s what makes outsourcing so attractive. We fully agree with this conclusion. Offshore developers in general are able to focus more on their work, they are not being disturbed. Thanks to more formal procedures they know better what to work on. Besides they are able to specialize themselves in a more narrow IT domain. By considering your outsourcing provider as a real partner you will also be able to profit from this efficiency gain. So why shouldn´t you? I am curious about your experiences and opinion, feel free to share them below, or meet and discuss on Facebook or through Twitter via @GOYELLO or @PetersOpinion.

Entrepreneur, co-founder & Managing Director of Goyello and Webmerce. Sociologist and electrotechnical engineer, a great combination that stimulates him to look for working solutions. Passionate about converting great ideas into new solutions. He is married and a proud father of 3 great sons. Participating in (and training for) triathlons to stay fit.

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  • I can’t agree more, but what I noticed is that the issue is not with showing our clients that outsourcing is giving relevant profits, because case study is big, but changing their mental restrictions in relation to company’s information/data safety. This is not the problem in US but in this part of Europe (where I assume you live, Poland/Gdansk, am I right?) everything looks different. Experienced managers or directors in Poland are usually old-fashioned, want to have everything under their control. It’s really strongly connected with their experiences and history of the country they have been functioning in. They know by experience that any company’s information shared with outside world can be used against them, but they need to realize that the danger is past. We have a different political system now, we are living in a different more opened society. It’s best time to open our minds and offices for outside professionals. You know that and I know that, they still don’t.

  • Marcin, thanks for your reply. It's true that my post is mainly based on my experience with Western-European clients. You are right that in Poland there is a lot less trust, which blocks a successful outsourcing relationship. A Polish Sociologist wrote about this low trust society: http://bit.ly/pN5gc. On my personal blog I wrote about a related issue: http://bit.ly/bRSrM. To be honest I do not know how to change this. I think it is a matter of time. Trust has to grow. It's not that easy to forget about the past. To secure future economical growth Polish people will have to change. I think the current attitude already blocks it.

  • Hi Peter, thanks for re. What I see is a generation gap in new technology's companies in Poland. Those who are managed by young people have an ability to change business structure, procedures or company's rules, are more keen to outsource and entrust you with an important tasks. Cooperating with them is always a pleasure and exiting think. Dealing with older generation managers is a marchandage and sometimes nothing else.

  • Hi Marcin, I notice a similar trend. Hopefully the “older” generation will manage to adjust to it as well. I think it is possible.