New England Data Services Blog

IT Outsourcing in Today's Economy

Anyone who has turned on the news in the past four months, or has picked up the newspaper, can tell you the American economy is in quite a decline.  Because of all the issues within the market itself, and the cost of operating any business these days, many companies are forced to lay off employees.  In fact, in September of 2008, non-farm jobs had decreased by over 159,000.  However, the IT services industry alone increased by more than 8,500 job positions.  The reasoning is very simple: Outsourcing.

Recently, companies have started a shift to outsourcing, and in some cases, laying off their own IT staffs in the process.  It is much easier for companies, in these struggling times, to pay a company as a whole per month for their services, versus paying several staff members a larger salary to manage their IT services.  

Besides saving on staff salary, there are other benefits to outsourcing as well.  For example, not every aspect of your business needs to be outsourced.  Perhaps you're more concerned about losing data, or you just want someone else to provide your internet connection to secure up-time.  On the other hand, maybe you are looking to expand and need more server space, and don't have the staff to fulfill the requirements for this.  Most outsourcing companies have the capabilities to do these things and could provide you with these services more cost-efficiently.  

Like any other plan of attack, there are always the risks, especially when considering outsourcing to overseas IT centers.  One example would be that if something fell through, you're left with a huge problem and most-likely lack the resources to fix it.  One must also be sure that the outsourcing company is capable of handling everything your IT department requires, and isn't just jumping at the chance to sign a larger contract.  

As a cliché rule of thumb, one should try and see each decision from every angle before eventually going with it.  Ask yourselves the questions: "Why is this company less expensive than this one?"  "What services does this company offer compared to that one"  "What are my benefits of having an IT staff versus outsourcing locally or over-seas?"  "Will the quality of service outweigh the money saved?"  Those that attack these situations from every angle will ultimately end up better off in the end.  

One thing that everyone should come to understand is that the IT services industry is a $748 billion industry, and has only continued to grow despite economic woes.  The businesses that are struggling with their financials should consider cost-effective alternatives such as outsourcing or other ways that would solve their IT problems.