What is IT Offshore Outsourcing
IT Offshoring Outsourcing is when a business engages IT Specialists of a different geography for fulfilling its IT needs efficiently. Offshoring (setting up office in different regions) and Outsourcing (delegating work to another company\group) aren’t new phenomenon for IT Services and have been in practiced by organizations of all sized for a long time. As the market matured with time, it was found the best approach is combining these two models to maximize efficiency while minimizing overall cost and risk.
By origin IT is a support industry, meaning that in most cases IT services are the means to streamline and enhance the core business process. For example, Accounting, Finance Management, etc. are the core processes for a Bank and it uses multiple IT Services\Solutions to execute its business processes efficiently. It is imperative that IT Service supplement the core processes making them easier and faster without causing an excessive cost overhead on the business. Therefore, the key requirement for efficient IT Services is a large taskforce of skilled IT professionals within a feasible economic range.
In majority of countries, especially the ones with well-developed economies, finding this 3-Tier Combination of Skill, Volume and Low-Cost has been a major challenge and it is here that in the past few decades India has emerged to be the globally recognized Best Choice for all IT Services and as a proof of this, all Global IT Giants have their largest taskforces based out of India.
Offshoring v\s Outsourcing v\s Offshore Outsourcing
There is often a confusion in understanding these terms by their definition, so let’s try to understand them by an example instead:
When a business “ABC” engages another business “XYZ” for executing some of its work deliverables (internal\external), it can be said that: “’ABC’ has Outsourced some of its services to ‘XYZ’”.
If “ABC” is a company originating from Norway and sets up its IT Development center in India, it can be said that “’ABC’ Offshores its IT Development activities”.
If “ABC” is a Sweden based company that engages an India based company named “123” for its IT Services, it can be said that “’ABC’ has its IT Services Outsourced Offshore to ‘123’”
Why Offshore Outsource IT Services?
In today’s Digital Era, IT Services are essential for businesses of all sizes across all domains.
Earlier, many businesses chose to setup their own (in-house) Sections\Departments\Teams for IT, but the fundamental flaw with this approach is that it is time consuming, brings a shortage of experience \ expertise and expensive making it unfeasible for a majority of small and new businesses.
Many of these businesses opted to Outsource their IT Services and when possible, Outsource them to a more plausible location.
As the IT Service industry matured with time, it was realized that Offshore Outsourcing IT Services to India based IT Companies is the Best Option since they facilitate:
- Skilled IT Professional at Economically Feasible Cost
- Abundance of Resource Pool for High (24×7) Availability across Diverse Technologies
- Ease of Communication with Multi-Lingual Support across
- A stable political climate
Advantages of Offshore Outsourcing
- Reduced Cost -Every employee and every division imply a cost for a company. You will enjoy the significant cost saving when you will outsource to another country with low production costs. These are saving realized through the low cost, cheaper materials, and also increase the efficiency which boosts the services offering.
- Increase Efficiency– Offshore outsourcing increases the efficiency of the organization because they plan to gain maximize the opportunity to acquire the available experienced and specialized resources. A fresh approach and new energy can help the organization and be delivered on a super tight deadline
- Access to specialized expertise-Offshore Outsourcing expertise can be expensive and competitive to hire domestically, Offshoring outsourcing gives a company’s access to employers with their niche to their skills at low cost with less competition, which gives results in lower hiring costs and potential better business results
- Improved business process-Cost savings aside, possibly the greatest benefit of offshoring is its potential to free up resources that can be diverted to emphasize your core business operations, which ultimately increase the organization’s profits.
Challenges of Offshore Outsourcing
- Time Difference-If a team of developers is spread out across various countries and even different continents then time management skills is one of the most important than usual. When the team members are located in the different time zone you might begin to be concerned about the issues relating to the quality control
- Less control over your operations-When you are not there in person to manage the operation and resolve the issues, small delays can turn into massive problems. A loss of control over the part of your operation that you are outsourcing is one of the main challenges that came from offshoring.
- Data information and security– Data information and security is one of the biggest concerns for any organization steps are taken to ensure that proprietary data and information are safe and protected. In reality, this is really a problem, but it is important to address this upfront and mention it in the defined document.
- Cultural Difference-In the Modern era of technologies, it is easy to connect with people regardless of their location, but companies should still keep cultural differences in their minds sometimes. People from different countries have different cultural approaches to work in a different way from how they can perceive business hierarchies to resolve their conflicts with their workers
We played our part in this blog by taking you through all the essentials of offshoring IT services. Knowing the pros and cons of offshore outsourcing will help you find the most suitable destination for your offshoring needs and if it is India, based on these considerations you can find the best offshoring services in India if you are looking for affordable outsourcing services.