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Ultimate guide to IT project outsourcing

Ultimate guide to IT project outsourcing

The pandemic has brought many changes in global business models. Companies traditionally skeptical about outsourcing have become more open to engaging with third-party service providers for their business needs.

From developing a robust web security framework to connecting employees to exclusive company-owned cloud storage, IT outsourcing has experienced a massive boom in the last couple of years. 

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Ultimate guide to IT project outsourcing

However, the technicalities of the field make it difficult for non-ITs, especially business owners, to understand what IT outsourcing is, what services are under it, and which services are appropriate for a business. 

What is IT outsourcing?

IT outsourcing uses external services for all the IT requirements of a business. These IT requirements include infrastructure creation, maintenance, or software development. 

IT outsourcing vendors typically offer end-to-end services. This depends on the actual needs of the company as well as its capabilities. 

MVP Asia Pacific is one of the Philippines outsourcing providers for outsourcing IT support. It is a premier firm that helps businesses to improve their IT capabilities while making a real difference to a client’s bottom line.

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The most common IT services are

  1. Application development
  2. Web hosting
  3. Telecommunications
  4. Data Storage
  5. Email Management
  6. Cybersecurity

Benefits of IT project outsourcing

IT outsourcing is akin to any outsourcing service. It generally enables businesses to function more efficiently and effectively without the burden of unnecessary functions that impede them from scaling. 

Typically, vendors or subcontractors assume the responsibility of defined tasks with rigorous deadlines and prices as defined in the service contract agreement by the parties. The difference between other outsourcing services to IT is the technical aspect of the job. 

IT services require a wealth of experience and technological know-how, which most businesses lack. With technological advancements, software development, and communications technology, IT solutions are becoming more industry jargon and too exclusive. IT vendors enable businesses to be free of this load. 

Other benefits of IT outsourcing are the following.

Reduced costs in IT development

IT devices, software, and the whole IT security infrastructure costs a fortune. The company can save a lot in its budget if it opts to outsource rather than hire full-time IT experts or acquire the technology. 

It can even determine the maximum budget that it can invest in its development and maintenance of it. The most important thing is to look for a credible service provider. 

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Hire the best in the world

Due to its technical rigidity, IT services are often difficult to find through local service providers. Usually, large corporations with a lot of technicians, engineers, and personnel can offer the best and most trusted IT services.

In the absence of local support, businesses can hire global talents with proven years of experience and expertise in the field. Businesses can choose and filter through a ton of available talents worldwide, allowing them to get the best deal at a minimal cost and turnaround time. 

Alternatively, there are individual contractors on online platforms that provide freelance services. 

The main advantage of this arrangement is it comes at a minimal cost. However, this arrangement is bound to be limited due to the availability of resources and technologies.

Assured security 

One of the significant advantages of an end-to-end IT outsourcing company is its capacity to create a secure web architecture for the company. With most business transactions going digital, records, information, and confidential materials of a company are vulnerable to hacking. 

Experienced and trusted IT outsourcing vendors do not just provide the services and develop them but ensure that it is strictly monitored 24/7. Encryptions are installed in the system along with self-learning security features.

For businesses that need dedicated teams to monitor and ensure real-time detection and resolution, these IT outsourcing contractors perform all the jobs. 

Swift Implementation 

IT outsourcing contractors have a bunch of software developers, technicians, and engineers. They develop applications and software that are tailor-fitted to the client’s needs. 

Even if the requirements are unique and difficult, these experts can come up with customized and user-friendly solutions that fit the brand and image of the business. 

Types of IT project outsourcing

IT outsourcing agreements are defined by various arrangements between the provider and the client. Normally, the contract is defined based on the needs and means of the client and the package offering of the vendor. 

The key to IT outsourcing is a basic understanding of the fundamental needs of the enterprise. Once the needs are set, creating an agreement that best serves the business, and the contractor is easier. 

Types of IT project outsourcing

There are three types of IT outsourcing: dedicated team, staff augmentation, and project-based outsourcing. 

Project-based outsourcing

Under this arrangement, the vendor assumes the entire responsibility for the task. An outsourced project manager, along with their team, will manage the implementation of the project. 

These projects are normally short-term and technical, entailing fast turnaround time and technical expertise. The project lead ensures that quality is within the acceptable threshold and bottlenecks are resolved easily. 

The business can also place pressure on the outsourced lead to ensure compliance and optimized performance. The main limitation of this arrangement is the business has no oversight of the processes of the project. 

In-house teams cannot intervene nor change anything that is out of the defined terms. Small favors or tweaks to the processes entail an immediate review of the agreement.

Dedicated team 

This type of outsourcing entails the hiring of a specialized team that will work on a project. The main difference between this model from the project-based is that the management has more involvement in the process and decision-making. 

The outsourced team becomes the enterprise’s technical and product advisor. Flexibility would no longer be an issue as the management could lead the outsourced team in its direction. This model best works for startup companies looking to expand with various technical needs. 

The main disadvantage of this arrangement is that the business has more responsibility to ensure the project’s success and that it is within expected industry standards. 

Staff augmentation

Staff augmentation functions to fill the gaps in the business based on the current needs. An entire team is not hired but only selected professionals can supplant the in-house team’s lacking expertise. 

The business can also opt to hire as many contractors as it deems fit. This works best for short-time business requirements and is conditional to the changing situation of the company.   

The main disadvantage of this is a long time for onboarding. With continuous recruitment and hiring, the management is more focused on interviews and onboarding than its core functions. 

Best IT project outsourcing regions 

Below are some of the best IT outsourcing regions that offer affordable, trusted, and expert IT solutions.

  1. Poland
  2. India
  3. China
  4. Belarus
  5. Philippines

Depending on the needs, means, and cultural affinity of the business, owners can choose among a plethora of IT outsourcing providers that best fit their requirements. 

Why outsource IT services?

Advancements in technology, coupled with the various security challenges on the internet, make IT solutions crucial to the overall well-being of an enterprise. 

The data of customers and the company need to be protected. The proliferation and sophistication of hacking technologies make this information susceptible to leaks. Customer experience is an important factor in securing more sales and satisfying clients’ needs. 

Under these premises, outsourcing IT services is a must. Sophisticated security must be installed on a company’s webpage and email routes. Engaging and interactive interfaces are desirable as they generate more website traffic and visibility.

With tough competition, businesses need to be well-equipped and prepared to address any issues. 

IT outsourcing allows companies to scale and be flexible. By hiring only what is required, the management can better project and juggle its finances and invest in worthwhile projects that will lead to the fast growth of the enterprise. 

To better understand outsourcing and the best companies to work with, we at Outsource Accelerator help any type and size of the company find the best partner for their business needs.

To understand more, schedule a 20-minute appointment with us to help you get started with your outsourcing journey. 

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Outsource Accelerator is the trusted source of independent information, advisory and expert implementation of Business Process Outsourcing (BPO).

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The Outsource Accelerator website has over 5,000 articles, 350+ podcast episodes, and a comprehensive directory with 3,000+ BPO companies… all designed to make it easier for clients to learn about – and engage with – outsourcing.

About Derek Gallimore

Derek Gallimore has been in business for 20 years, outsourcing for over eight years, and has been living in Manila (the heart of global outsourcing) since 2014. Derek is the founder and CEO of Outsource Accelerator, and is regarded as a leading expert on all things outsourcing.