Offshoring vs Outsourcing in the IT Industry
If you are ready to expand your IT company and take on more work, you might be considering offshoring vs outsourcing. Given changes in the global economy and recent technological advances, both strategies are becoming more and more popular. There are definite benefits to both of these strategies, but which is suitable for your IT company?
What is Offshoring and Outsourcing?
Both offshoring and outsourcing involve leveraging the expertise of specialized companies to engage additional IT staff. These new staff members are highly qualified, experienced, and thoroughly vetted by the hiring companies. This approach is an excellent way to reduce recruitment expenses and hire employees for additional IT work.
Why Do IT Companies Use Outsourcing?
Outsourcing is popular with IT companies that lack the resources to manage a project themselves. They outsource this work to a third-party company. This company is located and hired via an outsourcing firm that finds the right staff for the job. The outsourced company then takes control of the project, using its employees and resources to complete the work. Read more about IT Outsourcing: The Gateway to Digitalization
Outsourcing Pros and Cons
The main advantage of outsourcing is that it saves IT companies a significant amount of time and money, which would otherwise be spent on the resources needed to complete these additional projects. Purchasing new IT infrastructure is costly, and finding the right specialists for the project can be stressful. However, your IT company loses control over the project because it’s now in the hands of the outsourced company. So, outsourcing isn’t the best strategy if you want to expand your business and keep projects in-house. Read More about the advantages and disadvantages of Outsourcing
Why Do IT Companies Use Offshoring?
Offshoring differs from outsourcing because it allows IT companies to move some of their operations overseas, reducing costs and leveraging local expertise. This strategy is becoming more popular with many IT companies, regardless of size, simply because it makes good business sense. It works because your IT company can contract a third-party IT company in another country to perform various tasks, leveraging the overseas company’s lower operational costs.
Offshoring Pros and Cons
Offshoring benefits include reduced operational costs as work is relocated overseas, allowing your core staff to refocus on your company’s primary business. Capacity issues are also resolved, service quality is enhanced, and your company gains access to intellectual capital and talent pools that may not exist locally. The only real disadvantages of offshoring relate to different time zones and language issues. However, both of these can be overcome easily, mainly if you contract with offshoring companies in the Philippines , where most people are highly proficient in English and willing to work unusual hours to complete a job.
Originally published at BizaCoolNewsOnline — Offshoring vs Outsourcing in the IT Industry
