Outsourcing Projects
-Insourcing (in-house-development) is a common approach using the professional expertise within an organization to develop and maintain the organization's information technology systems.
-outsourcing is an arrangement by which one organization provides a service or services for another organization that chooses not to perform them in-house.
-onshore outsourcing is engaging another company within the same country for services.
-nearshore outsourcing is contracting an outsourcing arrangement with a company in a nearby country.
-offshore outsourcing is using organizations from developing countries to write code and develop systems.
Outsourcing Benefits
i) includes:
- increased quality and efficiency
- reduced operating expenses
- outsourcing non-core process
- reduced exposure to risk
- economies of scale, expertise, and best practices
- access to advanced technologies
- increased flexibility
- avoid costly outlay of capital funds
- reduced headcount and associated overhead expense
- reduced time to market for products or services
ii) outsourcing challenges include:
- contract length
- difficulties in getting out of a contract
- problems in foreseeing future needs
- problems in reforming an internal IT department after the contract is finished
-competitive edge
-confidentiality
-scope definition
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