The appropriate model for an IT service is typically determined by the type of service provided. These services are increasingly offered not only by traditional outsourcing providers but by global and niche software vendors or even industrial companies offering technology-enabled services. In fact, cloud services account for as much as one third of the outsourcing market, a share that is destined to grow. In today’s cloud-enabled world, however, IT outsourcing can also include relationships with providers of software-, infrastructure-, and platforms-as-a-service. Application outsourcing may include new application development, legacy system maintenance, testing and QA services, and packaged software implementation and management. Infrastructure outsourcing can include service desk capabilities, data center outsourcing, network services, managed security operations, or overall infrastructure management. Traditionally, outsourced IT functions have fallen into one of two categories: infrastructure outsourcing and application outsourcing. CIOs are tapped not only because they often have developed skill in outsourcing, but also because business and knowledge process work being outsourced often goes hand in hand with IT systems and support.įor more on the latest trends in outsourcing, see “ 7 hot IT outsourcing trends - and 7 going cold.” However, CIOs often will be asked to be involved in - or even oversee - non-ITO business process and knowledge process outsourcing efforts as well. IT outsourcing clearly falls under the domain of the CIO. Some of the risks of outsourcing include: possible cash influx resulting from transfer of assets to the new provider.access to innovation, intellectual property, and thought leadership.lower ongoing investment in internal infrastructure.increased flexibility to meet changing business and commercial conditions.increased focus on strategy/core competencies.lower costs (due to economies of scale or lower labor rates).The business case for outsourcing varies by situation, but the benefits of outsourcing often include one or more of the following: Discover the secrets of employee retention, why good employees leave (and how to prevent it), and the best diversity and inclusion practices for changing your culture.
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