5 reasons to Use Offshore Services: Pros & Cons of IT Outsourcing

Sales Team at Rozdoum

August is the best time to sum up results of the current year as well as to analyze the main points and tendencies of IT services for the next six months. The global market for IT outsourcing is on the pick of its popularity and despite the difficult economic situation, it’s still growing. It’s not easy to work under conditions of economic instability for many Companies.

For the last decade, the growth of IT Development makes IT outsourcing one of the most popular customer services. This topic has been discussed many times, but we still feel a need to summarize all knowledge and find out global trends of software offshore services in 2015.

Nowadays, it’s really difficult to answer a key question: what are the reasons to transfer your own projects to overseas competitors?

Let’s talk about IT outsourcing Pros & Cons. What will influence on a client’s decision to transfer their ideas to foreign contractors? What are the risks customers face during outsourcing?

In this post, we will cover above-mentioned questions based on Rozdoum experience.

Why is it worth to use IT outsourcing for software development?

1. It’s profitable! When you outsource project responsibilities to another company you shouldn’t keep developers in staff and, therefore, pay them a salary as well as cover all social benefits. You can hire a remote qualified employee instead, who will participate in a company profit formation directly.
2. IT Outsourcing is an interrupted process of software development. Interchangeability of companies’ professionals will not stop the current process, even if the responsible expert is temporary out of the office or even fired.
3. Professionalism and knowledge of Company’s employees are generally higher than any freelancer has, who is self-employed and works independently. It’s happening due to the sharing experience between colleagues, regular training courses or due to the strict selection of IT-experts in accordance with a high competition in the global IT market.
4. Modern IT-companies usually have the most contemporary equipment and software, and far not all freelancers have up-to-date devices and renew their hardware on regular basis.
5. Quality and service reliability. A software development house usually gives guarantees and takes responsibilities for the quality of provided work. You will get a legal contract and safety working warranties with a company-outsourcer. With the freelancer, you will have only a verbal agreement, excepting some rare cases.

Disadvantages and Risks of IT Outsourcing

1. Working with an unfair contractor, you can face risks of breaking terms of work by an outsourcer as well as get the poor quality of service, and as a result – waste your time and money.
2. It might be necessary to find a new outsourcing shop in the case of bankruptcy and you will get new costs and risks accordingly. That’s why the customer should look for a reliable company that has experience of more than 5-7 years, has a stable position, a good amount of positive references and feels quite confident in the market.
3. Initially, you should do a trial project with the outsource supplier and evaluate his professional competence. It will prevent from a non-quality service.
4. Lack of effective project management. In this case, the customer has to control and be involved in the development process all the time.
5. Nowadays, IT outsourcing processes are not regulated by law.  It may not seem to be a disadvantage for the IT outsourcer, however, for the customer it can be another risky point.

New IT outsourcing
global trends
in 2015-2016

August is the best time to sum up results of the current year as well as to analyze the main points and tendencies of IT services for the next six months.

The global market for IT outsourcing is on the pick of its popularity and despite the difficult economic situation, it’s still growing. It’s not easy to work under conditions of economic instability for many Companies. However, a model of using IT outsourcing changes and helps offshore suppliers to find new opportunities to improve client’s business. We have analyzed experts’ opinions about tendencies of software market as well as made our own research, and now ready to present you our final results.

2015 is a year of serious changes in IT supply services and IT consumption models that provide new opportunities for individual players and business models. World IT Companies are expanding their own open source solutions, strengthening infrastructure, especially in the public sector and military-industrial complex that influence substantially on major upcoming development trends.

Second trend is new technologies. An implementation rate, including cloud technologies, mobilizing, Big Data and software-configurable network, will grow, despite the general economic situation. New trends are stimulating demands of IT services, especially information system consulting and training. Cloud technologies make it possible to modernize an approach to manage IT infrastructure through the usage of advanced technologies, a high level of standardization, flexibility of implemented solutions, as well as ease of scalability. So nowadays, OpenStack is one of the most common solutions for organizing cloud environments such as Infrastructure as a Service (IaaS). This product is being used by leading companies around the world to build a private cloud infrastructure.

The third trend is fast Internet spreading. In 2015 the number of Internet users will grow by 6.2% compared to the 2014 and will reach 2.89 billion people or approximately 42.4% of the World population according to eMarketer, the analyst company. So, that’s why, we can predict that the demand for the hosting usage, maintenance of corporate mobile services and cloud solutions will increase accordingly.

The fourth trend is training. This year many companies reduced its budgets for staff training significantly, and now the preference is given to the free or low-cost online courses. However, the continuously raising qualification is a necessary aspect in the IT area. Thus, in spite of the cost reduction, the tendency of obtaining new knowledge and possibility to get mid-career education will be saved.

As a result, investments in staff education, experts certification and audit of the management processes are the key factors of the successful development for the Rozdoum team.