There's no perfect formula for which IT resources to keep and which to ship off to a third party.
One company may see a help desk service as good for company culture and collaboration and keep it in-house. Another may see it as a commodity service that's ideal for an Indian outsourcer. Figuring out the outsourcing/insourcing ratio that delivers the best results is a high-stakes problem for many a CIO.
With that in mind, here are four growing trends in cloud, offshoring, and domestic outsourcing for 2014 and beyond as defined by outsourcing consultants who spoke to InformationWeek.
1. Cloud vs. traditional outsourcing
While migrating your IT infrastructure to a cloud service is not "outsourcing" in the traditional sense, it is a form of outsourcing. But even traditional outsourcing models are using cloud technology underneath, whether the outsourcer is using Amazon or IBM is using its own cloud.
Both public and private clouds are getting more traction this year among Fortune 500 companies and could threaten the traditional outsourcing model, says David Rutchik, a partner at IT consulting firm Pace Harmon.
Rutchik points out that, as a result, outsourcers like CSC and IBM are integrating cloud capabilities into their products. IBM, for example, bought SoftLayer last year for $2 billion. "They're going on the offensive to get new business or on the defensive to keep from being priced out by cloud players," Rutchik says.
Big companies that once feared using public cloud because of data security concerns are gaining confidence to use it for development and testing, and even for running customer-facing apps, says Rutchik, based on the activity of Pace Harmon's Fortune 500 clients.
"Major retailers are using public cloud for at least a portion of their service," he says. "It's much faster to provision a server, much less expensive. The security worries haven't been alleviated, but are less paramount."
[ Read the rest of this article on InformationWeek. ]