IT Outsourcing May Not be Worth the Effort

A new survey finds that IT outsourcing is often disappointing--more costly than estimated, and with lower quality than expected.
By Tony Bradley
News Jun 20th 2012

Outsourcing is the lifeblood of IT. The prevailing theory is that outsourcing saves companies money and enables them to engage a broader pool of IT skills and talent than they could in-house. However, the results from a new survey challenge that perception. 

Lieberman Software surveyed IT professionals at the InfoSecurity Europe 2012 conference and found that 71 percent of organizations outsource a "significant portion" of their IT needs. However, confidence in outsourcing is not as high as you'd think. 

Although outsourcing is often seen as a cost-cutting measure, 42 percent of the survey respondents reported that outsourced projects ended up costing more than originally planned--16 percent claimed the costs were "significantly more". That doesn't necessarily mean that it was more expensive than hiring, training, and retaining in-house talent for the same project, but it still reflects poorly on IT outsourcing in general.