Thomsett on Outsourcing

Outsourcing: The Great Debate

Notable points and some that remind me of my own experiences:

  • the difference between process and project work, and how most other industries outsource the former – but in IT the latter is often outsourced
  • “squeaky wheel syndrome” – outsourced functions’s success may be improved by the increased attention given to them by the outsourcer’s management simply due to the cost/contracts involved
  • outsourcing organisations typically track work much more accurate than internal departments (who often have “hidden” work), so it’s difficult to compare and measure success
  • arrangements sometimes start with the outsourcing organisation’s top staff working on the project, but over time these are replaced by lower-skilled staff
  • loss of intellectual capacity – if the outsourcing involves transfer of staff, the best staff are the ones most likely to leave for other companies, leaving an averaged-down group
  • the outsourcing organisation’s lawyers are likely better/more experienced in the area than the outsourcer’s
  • potential loss of intellectual capital (see IBM-Microsoft)

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