Outsourcing Vs. Insourcing: You Need Both

IT Careers: 8 Steps Toward New Business Roles

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Why is this happening now? Is this being driven by the H-1B visa issue? Cost increases overseas? Patriotism?

Yes, some of these factors are driving this trend, but the biggest reason for the emergence of insourcing or reshoring is that for the delivery of some IT services, it just makes sense.

Trends tend to be cyclical and are spurred by changes in market conditions. The rise of reshoring is being fueled by certain changes in IT such as a bigger domestic talent pool outside tier-one cities, the use of videoconferencing to make distributed teams highly productive, and the overall maturation of the outsourcing market. GM might be aggressive in its reshoring approach, but its move will likely motivate other companies to look at their own outsourcing.

[ Time to question old hiring assumptions? Read H-1B Workers Not Best Or Brightest, Study Says. ]

Outsourcing strategies should be directly tied to business strategies, and as market factors change, so should outsourcing strategies. Common drivers of an outsourcing strategy include: cost, time to market, talent availability, customer support needs, global expansion and organizational readiness. Changing market factors such as increased offshore pricing, new delivery models (e.g. agile) and the rise of mid-size and specialty service providers all make it a good time for companies to adjust their own sourcing models. But that's easier said than done.

When it comes to sourcing models, there are many terms to digest: insourcing, reshoring, outsourcing, offshoring, onshoring, nearshoring, captives and so on. All are familiar in the IT industry but the most important term to consider is "rightsourcing," which sometimes gets omitted from sourcing strategies.

Rightsourcing implies the use of common sense to determine where certain services should be delivered. The right location of tasks and services is driven by quality, cost and availability of talent. Rightsourcing is directly tied to business goals and should be unique to each company -- meaning there is no cookie-cutter approach to determining what sourcing model will work best for your company. Insourcing might work for some tasks and outsourcing for others.

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