Outsourcing Revealed, Do You Actually Need To Outsource

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Letter of Intent

Dear Reader,

Today\'s modern business is dependant on information technology as we store more and more business information on the networks we use. Ensuring that information is readily available and maintains privacy while at the same time is inexpensive is a challenge faced by many businesses.

Many Businesses do not have the resources to look after their IT needs or have an internal IT department with a varied expertise in different verticals such as networking, security, database management and Software development that costs too much. This document will take you through the meaning, advantages, disadvantages and the points that you should consider before outsourcing your IT team to an outsourcing service provider.

We believe that the cost of managing the IT environment in the developed countries like USA, UK, Canada and Germany is just too high; companies are even willing to spend an enormous sum to get it down in some way.

Outsourcing some, if not all, of their IT functions is an option they should consider as a solution to this problem.

We hope that this document would help you in determining the need for you to outsource.

Kind Regards,

Harkirat Singh Bedi
Business Promotion Manager
iBoss Tech Solutions Pvt. Ltd.

Published in: Business, Technology
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Outsourcing Revealed, Do You Actually Need To Outsource

  1. 1. US Phone: +1-585-591-6050 India Phone: +91-120-3937300 UK Phone: +44-845-869-7579 Website: www.ibosstechsolutions.com Email: info@ibosstechsolutions.com TABLE OF CONTENTS Letter of Intent...................................................................................................................1 What does Outsourcing mean?.........................................................................................2 What Outsourcing doesn’t mean?....................................................................................3 Reasons to Outsource........................................................................................................4 Advantages of Outsourcing...............................................................................................5 The Disadvantages of Outsourcing..................................................................................6 Factors of Successful Outsourcing...................................................................................7 Examples of some services to outsource..........................................................................9 Letter of Intent Dear Reader, Today's modern business is dependant on information technology as we store more and more business information on the networks we use. Ensuring that information is readily available and maintains privacy while at the same time is inexpensive is a challenge faced by many businesses. Many Businesses do not have the resources to look after their IT needs or have an internal IT department with a varied expertise in different verticals such as networking, security, database management and Software development that costs too much. This document will take you through the meaning, advantages, disadvantages and the points that you should consider before outsourcing your IT team to an outsourcing service provider. We believe that the cost of managing the IT environment in the developed countries like USA, UK, Canada and Germany is just too high; companies are even willing to spend an enormous sum to get it down in some way. Outsourcing some, if not all, of their IT functions is an option they should consider as a solution to this problem. We hope that this document would help you in determining the need for you to outsource. Kind Regards, Harkirat Singh Bedi Business Promotion Manager iBoss Tech Solutions Pvt. Ltd. iBoss Tech Solutions Pvt. Ltd. US Office India Office 6916, Castle Peak Drive, West Hills, CA 91307 B-59, 1st Floor, Sector 63 Noida - 201301
  2. 2. US Phone: +1-585-591-6050 India Phone: +91-120-3937300 UK Phone: +44-845-869-7579 Website: www.ibosstechsolutions.com Email: info@ibosstechsolutions.com What does Outsourcing mean? Many companies are already familiar with outsourcing as they usually outsource functions such as deliveries, cleaning and building maintenance to outsourcing service providers. Outsourcing the IT function implies delegating the management and support for all or some of their IT requirements to an outsourced service provider. That outsourcing service provider may provide the agreed service by having their staff visit the business regularly and deploying their own staff onsite full time or they may provide the service remotely at the same or a different location or country. IT outsourcing can be defined as the transfer of operational onus of IT business processes or infrastructure management to an outsourcing service provider. Outsourcing can also be defined as the arrangement whereby firms contract with independent counterparts in the same vis-à-vis another country to carry out particular stages of production. iBoss Tech Solutions Pvt. Ltd. US Office India Office 6916, Castle Peak Drive, West Hills, CA 91307 B-59, 1st Floor, Sector 63 Noida - 201301
  3. 3. US Phone: +1-585-591-6050 India Phone: +91-120-3937300 UK Phone: +44-845-869-7579 Website: www.ibosstechsolutions.com Email: info@ibosstechsolutions.com What Outsourcing doesn’t mean? Outsourcing IT is not the cure to all ills. If there are fundamental troubles either with the business processes the IT infrastructure is supporting or with the IT infrastructure itself, outsourcing the management and support of the infrastructure will not eradicate those problems. Outsourcing should also not be seen as an interim solution to a particular problem. For the business to reap the full advantages of outsourcing, it should develop a continuous and longstanding relationship with the outsourcing provider. Upon outsourcing an IT function and delegating the management and support of that function to an outsourcing service provider, outsourcing should never be seen as a means for finishing the responsibility for that function. In conclusion, the success of the IT business lies with the owner and management along with the support of the outsourcing service provider. It is important that a company considers outsourcing some, or all of its IT and retains the overall responsibility for the function in-house. iBoss Tech Solutions Pvt. Ltd. US Office India Office 6916, Castle Peak Drive, West Hills, CA 91307 B-59, 1st Floor, Sector 63 Noida - 201301
  4. 4. US Phone: +1-585-591-6050 India Phone: +91-120-3937300 UK Phone: +44-845-869-7579 Website: www.ibosstechsolutions.com Email: info@ibosstechsolutions.com Reasons to Outsource There are many grounds on which businesses should consider outsourcing some or all of its IT functions. Shortage of internal resources With the growing dependence on complex IT systems, there may not be enough internal resources available to complete all tasks to the level required by the business. It is to be seen that with the given the small number of resources many businesses operate with, any activity that is time consuming and ties up valuable resources will have a negative impact on the company’s bottom line. Skill shortage The company may not have the skills with them to complete a process. This is particularly true for specialist functions such as email, data entry or database administration. Cost reduction A task that can be completed more inexpensively by an outsourcing service provider can help reduce costs by eradicating the need for that role within a company or by re- allocating existing resources into more revenue generating/production/supporting roles. If any of the businesses IT functions meet any or the entire list of criterion mentioned above then it should consider outsourcing that function to an outsourcing service provider. Replacement of a poor onshore service Whether it is because of lack of skills or lack of available resources, some IT functions may not be provided at the levels required by the business. The cost of training current staff or providing additional resources to address the problem may be too prohibitive. iBoss Tech Solutions Pvt. Ltd. US Office India Office 6916, Castle Peak Drive, West Hills, CA 91307 B-59, 1st Floor, Sector 63 Noida - 201301
  5. 5. US Phone: +1-585-591-6050 India Phone: +91-120-3937300 UK Phone: +44-845-869-7579 Website: www.ibosstechsolutions.com Email: info@ibosstechsolutions.com Advantages of Outsourcing The primary advantages outsourcing can bring are Focus on core business By outsourcing repetitive and non-essential tasks, staff can focus on the core business functions to better support the business and its clients and generate competitive benefits. Frees resources Resources are not fixed up with non-essential and repetitive tasks and can be re-deputed to more business valuable tasks. Access to more resources Outsourcing can provide more resources and expertise that can be always looked upon when required. Better cash flow In some instances where a service is outsourced for a fixed hourly fee, the company can better plan and budget its cash flow. Better service levels Outsourcing to an outsourcing service provider whose core business is providing the agreed services at a desired level can result in better service levels. Shares the risk Having a provider bound to provide a service shares the liableness of ensuring that service is delivered. iBoss Tech Solutions Pvt. Ltd. US Office India Office 6916, Castle Peak Drive, West Hills, CA 91307 B-59, 1st Floor, Sector 63 Noida - 201301
  6. 6. US Phone: +1-585-591-6050 India Phone: +91-120-3937300 UK Phone: +44-845-869-7579 Website: www.ibosstechsolutions.com Email: info@ibosstechsolutions.com The Disadvantages of Outsourcing Outsourcing can bring a number of disadvantages to the IT business, especially if the outsourced agreement has not been thought of carefully. It is important to consider and address these issues before committing to outsource any of your services. Deterioration in service The selected outsource partner itself may not have the required skills or manpower available to provide the agreed level of service. Service provider may close down There is always the possibility that the outsource provider may close down in the area of the outsourced service. Role duplications If not identified properly with the provider, some of the outsourced tasks and roles may still be performed in-house and result in duplications of tasks and roles which in effect wont provide the expected benefits. Lack of flexibility One of the advantages that businesses have over their larger competitors is the ability to be dynamic. If the wrong processes are outsourced, this flexibility could be adversely impacted. The above risks can be mitigated by careful planning and thorough research in the initial phases of outsourcing the services. iBoss Tech Solutions Pvt. Ltd. US Office India Office 6916, Castle Peak Drive, West Hills, CA 91307 B-59, 1st Floor, Sector 63 Noida - 201301
  7. 7. US Phone: +1-585-591-6050 India Phone: +91-120-3937300 UK Phone: +44-845-869-7579 Website: www.ibosstechsolutions.com Email: info@ibosstechsolutions.com Factors of Successful Outsourcing Good Home work is the key to successful outsourcing. Lack of adequate home work acts as a deterrent to many outsourcing initiatives. The time and effort spent on the home work before signing the contract pays dividends later on in the business relationship. Accept the company cannot do everything There are few businesses, unless directly involved in the technology sector, who can claim IT is their core competency. As a result, businesses should look at what IT processes are essential and required to the core of their business and what tasks should be outsourced. Carefully select processes to outsource Identification of companies where the work can be outsourced and the analysis of the functions that can be outsourced can be performed by starting to give small pieces of in- house work to the outsourcing service provider and then move on to larger chunks for a smooth transition. Badly run IT functions and non-essential tasks are the prime candidates to outsource. It should be pointed however that the overall responsibility for strategic functions should remain within the company as no outsourcing service provider will be able to run your company for you. Scrutinize problem areas If you put the load for poorly defined functions or problems onto an outsourcing service provider, you shall not succeed. If the problems are due to badly designed IT processes or poorly understood business processes, then this transfers the problem from one party to another and provides for a confrontational relationship. Instead, identify where the problems lie and agree what can and cannot be delivered. iBoss Tech Solutions Pvt. Ltd. US Office India Office 6916, Castle Peak Drive, West Hills, CA 91307 B-59, 1st Floor, Sector 63 Noida - 201301
  8. 8. US Phone: +1-585-591-6050 India Phone: +91-120-3937300 UK Phone: +44-845-869-7579 Website: www.ibosstechsolutions.com Email: info@ibosstechsolutions.com Clearly defined roles It is important when outsourcing, roles at various functions of the IT system are clearly defined, agreed and demonstrated. Many outsourcing contracts fail because the roles and responsibilities for some functions and tasks are not clearly defined resulting in more costs. Set sensible goals and objectives Clearly agreed documented service levels and sensible goals that the outsource provider must meet will ensure that both parties are signing the contract with clear and realistic objectives and goals. Go through track records Select a service provider who has a built track record in the arena and particularly in providing required services. Do ask the service provider the evidence of their expertise and experience, so that you are sure that they will be alive in future. Always seek customer references for companies with similar requirements and verify those references. Ask for local references for sure. Meet regularly and see the process model is being followed It is important to have regular meetings to support a structured reporting and communications process. These meetings should be an opportunity to work with the outsourcing service provider to ensure that a. Agreed objectives and service levels are being met, b. Problems and issues are being addressed c. Future plans are being shares so that both parties can better plan their future. Be prepared As with any relationship, an outsourcing relationship has its problems. If both parties enter the contract with proper home work, planning and communicate clearly and honestly, both parties can ensure a longstanding success of the outsourcing engagement. iBoss Tech Solutions Pvt. Ltd. US Office India Office 6916, Castle Peak Drive, West Hills, CA 91307 B-59, 1st Floor, Sector 63 Noida - 201301
  9. 9. US Phone: +1-585-591-6050 India Phone: +91-120-3937300 UK Phone: +44-845-869-7579 Website: www.ibosstechsolutions.com Email: info@ibosstechsolutions.com Examples of some services to outsource • Software Development • System Integration • Web Development • Migration and Porting • Custom Application Development • Support and Maintenance • Product Development and Re-engineering • QA & Testing • Customer Support Outsourcing these functions to an outsourcing service provider can release valuable IT resources to concentrate on more revenue generating tasks. Thank you again for your time in reading this document. We hope that we have answered many, if not all the questions that you had about outsourcing. If you still have any questions, do drop in a mail at info@ibosstechsolutions.com or call us at any of the phone numbers mentioned above. We look forward to hear from you. Thanks and Regards, Team iBoss Tech Solutions Pvt. Ltd. iBoss Tech Solutions Pvt. Ltd. US Office India Office 6916, Castle Peak Drive, West Hills, CA 91307 B-59, 1st Floor, Sector 63 Noida - 201301
  10. 10. US Phone: +1-585-591-6050 India Phone: +91-120-3937300 UK Phone: +44-845-869-7579 Website: www.ibosstechsolutions.com Email: info@ibosstechsolutions.com Disclaimer: All documents, files or other data accessible on or through the community websites over the internet are provided solely as a courtesy to facilitate public access to information. While iBoss Tech Solutions Pvt. Ltd will attempt to ensure that the information stored on the systems is current, accurate, accessible and reliable, it assumes no responsibility or liability for any damages or inconvenience incurred based on use of information retrieved from the systems. Based on the fundamental universal condition of the electronic communication process, iBoss Tech Solutions Pvt. Ltd. does not guarantee or warrant that the content posted on the internet through various community websites will be uninterrupted, without delay, error-free, omission-free, or free of viruses. Therefore, iBoss Tech Solutions provides such documents, files to other data “as is” without any warranty of any kind, either expressed or implied, including but not limited to, accuracy, reliability, omissions, completeness and corrections. iBoss Tech Solutions Pvt. Ltd. shall not be liable for any claim for damages, including lost profits or other consequential exemplary, incidental, indirect or special damages, relating in any way to the documents, files or other data accessible on or through the community websites that iBoss Tech Solutions Pvt. Ltd. believes to have subscribed to, including, but not limited to, claims airing out of or related to electronic access or transmission of data or viruses. The content including our profile on various community websites may change from time to time and without notice with change in the company policies and infrastructure. Information shared through various community websites that we have subscribed to represent the best information available at the time of posting. This information may be shared only by giving our reference. Please note that information provided is based on the existing economic environment and can be changed without advance notice. The statements made in this document and all other information contained herein is believed to be correct at the time of publication. However, iBoss Tech Solutions reserves the right to make at any changes in and additions to the information any time without notice. In no event shall iBoss Tech Solutions or its employees be liable for any damages whatsoever (including, without limitation, direct, indirect, special, compensatory, punitive or consequential damages, loss of use, loss of data, loss of income or claims of third parties) and shall not be responsible for any claims, including copyright infringement arising out of or in connection with the use of or inability to use the materials on this document or any website with which it is linked, even if iBoss Tech Solutions Pvt. Ltd. has been advised of the possibility of such damages. iBoss Tech Solutions Pvt. Ltd. US Office India Office 6916, Castle Peak Drive, West Hills, CA 91307 B-59, 1st Floor, Sector 63 Noida - 201301

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