Managing the risk of outsourcing the IT function at companies

Abstract

The main objective for this secondary research is to determine whether the risk of outsourcing the IT function can be managed. Driven by political and economic dynamic changes, facilities management was borne to enable reacting to change. Doing business in today’s global economy requires exceptional skills from management in order to be competitive and to have a specific competitive advantage over competitors are getting even more demanding. One of the widest used methods of facilities management deployed by organisations is that of outsourcing in various forms (i.e. I.T., H.R., Distribution, Warehousing, etc.) for various different reasons (i.e. reduce costs, improve quality, focus on core business, etc.). In order for outsourcing to be successful, it needs to add benefits to profits, efficiency or effectiveness ethic. Outsourcing assists management to gain a competitive advantage over competitors within their specific industries as part of their organizational strategies and developing or strengthening core competencies at the same time. Global outsourcing on the other hand leads to controversy inasmuch as it reduces home-country economic activity and employment. The consulted secondary resources confirm that if outsourcing delivers managers can take calculated decisions to use it in their businesses. The future of outsourcing is promising as non-core functions of businesses may rather be outsourced to save on costs. A broad set of new and alternative IT delivery models are already main stream. These models receive attention because of benign economic market conditions.