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If you deprive yourself of outsourcing and your competitors do not, you’re putting yourself out of business. –Once quoted by former Singapore prime minister.
“If you don’t adapt, you will not survive” or “If you will see outsourcing as a bane, you will perish”. Not trying to sound dramatic, but an American IT graduate would question the above “hyperboles”. “IT outsourcing will mean I have fewer options to choose from or I may end up jobless”. To this, one would respond—“so u think competence and business strategies should give way for Americans, just because the jobs happen to be in America?”
From a young American perspective, one would say that asking the questions like those is valid and very human. It’s about Darwinian survival, people and businesses both need to survive (more on those emotional aspects in a later post). We have already witnessed great dynamics in IT outsourcing world, esp. with respect to American IT outsourcing.
A source (link at the end) quotes that there are more than 14 million jobs in America, which are vulnerable to offshore outsourcing. An obvious question an IT employee in America would ask—“What happens to my IT department”.
Many big IT companies that currently have huge in-house IT departments also raise the question.
“Outsourcing a part or complete IT department frees up a company’s valued IT personnel so they can support their mission critical business processes. In addition many companies today are finding that they cannot take the risk or endure the financial burden of running their whole IT department in-house.”
So whether to outsource or not is no longer an option anymore. How to strategically outsource so that the whole exercise is dealt without any derived problems? Yes, that is something more of a practical question and needs to be thought upon.
The answer to the question lies somewhere in the middle of going for a complete IT department outsourcing and not doing it at all. One has to carefully plan and cut the IT department gradually, increase outsourcing, while still retaining best of both worlds. The best way to start can be waiting until one finds a suitable supplier, which suits the business needs, the best.
After one is convinced that the work can be outsourced, next step should be planning the activities leading to cut down of IT department. And even after that, one should consider retaining experienced employees who can manage the outsourcing exercise.
But wait! The question is still unanswered- “I am an IT graduate, what happens to me?” Well, the Obama government has already proposed few restrictions on outsourcing, some of which have been already implemented (more on this later).
McKinsey quotes- “This may sound obvious, but probably the biggest stumbling block to offshore outsourcing is that after all the contracts have been signed, companies abdicate responsibility for projects to the provider…”
The above quote just corroborates the point about retaining the experienced employees of the IT department in the provider company
All sounds good, but there is a problem which most of the IT clients’ neglect. Many a times the suppliers internalize the operations of the client and lose the fresh ideas, which, they would have otherwise brought about had they been still working for the client, instead of becoming a “part” of the client. Of course, that does help by giving supplier deeper insights into the client’s business. But again, a finer balance and following a median path might do the trick. Which essentially means that companies should opt for right mix of experienced employees and some people from the outsourcing department.
Outsourcing is there to help existing IT departments, not to replace them. So the hue and cry about “Where’s my Job” or “What happens to my IT department?” are not as valid as people make them sound. The providers and suppliers need to sit down and work out the best possible solution to handle the situation. Sounds like a nice coffee topic? (We know it more serious than that).
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