In today’s era the world has become a global market with concentrated competition. Organizations have recognized that they have to focus on their core competencies with respect to the limitations that they have. They need to expertise comprehensively on the core competencies and outsource IT the non-core activities to other outsource IT that have expertise in these non-core activities. Because of the need to expertise in core competency, outsourced IT services have become the most sort-after business practice in the world market. Such business practice leads to the formulation of the business or strategic partnerships. People have a misconception with regards to this terminology. They have merely confined Outsource to the IT sector. Broadly speaking, it can be associated to various business sectors. We have divided these sectors into Manufacturing and Service, where the IT sector is just a part of the service sector.
One can define outsourced IT services as an apportion of non-core activity to the third party with expert skills in concerned activities, and the activity is regulated by a legal contract. There are different facets of outsourced IT. These can be typecast into professional services, project management, outsourcing development units with proficient resources, and a joint venture with an offshore trader or an owned subsidiary for offshore outsourced IT services. Offshore outsourcing services have become the best and the most popular practice because of its lucrative advantages. The beneficiaries are not only the clients but the service provider’s benefit a lot as well.
Outsourced IT Services - A Strategic Decision
The decision to outsource IT for any organization is critical. Thought to outsource IT, is not irrelevant but one needs to seek as to how it can be of strategic importance. For instance an organization that is engaged in the manufacturing of bearings, its core competency lies in the manufacturing bearings but the organization is not able to focus entirely on its core competency as it has to deal with various business issues such as documentation, official work like preparing invoices, data entry, inventory management, accounting and finance etc. Now the company wastes a lot of valuable resources that if used elsewhere can give exceeding benefits. So what the organization does is, taking care of the offshore outsourced IT business issues, it outsources such non-core activities like finance and accounting to the outsource IT company that has expertise in such activity.
Offshore outsource IT improvement
Many organisations have offshored their software testing with varying degrees of success. Some have worked well. Many others have struggled and it is not uncommon to find organisations that have onshored their offshore resources or are simply having difficulty realising the value from these outsource IT deals that the business case outlined.