When a Business Needs Outsourcing

It is worth creating and developing a large internal IT department when the company is large, has a serious IT strategy, information development is vital for solving business problems, and, of course, when there is an opportunity to invest in creating your own IT department.

Each of the projects is important for business processes, any interruptions in work instantly affect the bank’s customers, and the brand suffers reputation losses. In addition, the bank has already developed its own long-term expertise: many developments have no analogues in the market of IT services, so it is almost impossible to outsource them.

How to Outsource Web Development

One-time or non-core tasks

Of course, if a specific task is required, it makes no sense to recruit and train the staff of developers. The strengths of external development are the ability to quickly attract specialists of the desired profile and the ability to optimize costs. When working with outsourcing, you pay only for the hours of work of specialists, and not for the time of their lunch, sick leave or vacation.

The second case, if the task is large-scale, but non-core. For example, the development and support of the site, and your IT department is loaded with other things. Then outsourcing comes to the rescue. So, for example, in the football club “Spartak” successfully combine external and internal development. FC management is aware: even though Spartak is a major brand, it is not an IT company. “We do football, they are development,” the FC press service said. Spartak has its own IT department, but it deals with the general infrastructure (ticket service, IT in the stadium, etc.). To create websites and applications, the club turns to highly specialized professionals.

Another example is the monopolist of the Stoloto lottery business in Russia. The site brings millions of rubles, but the contractor deals with the technical side and design, because for Stoloto the website is not a business, but a sales channel.

The staff for a long-term project does not pay

If you understand that the project is to be long-term, but it is non-core for full-time specialists, it is better to involve third-party developers. Let them be supervised by a small internal IT team. For example, Ingosstrakh-Life IC used contractor services to develop the internal system, when the entire company staff was 150 people, and the development of the iFront system required the participation of at least 20 IT specialists. There was no point in increasing the overall staff by 15% for one project, so we decided to outsource the project.

Many branches in different countries

Global companies have their own specifics, it is associated with the need to combine the work of branches scattered around the world into a single network. So, at Schneider Electric, purely internal global projects are successfully developed and supported by external teams from different countries under the supervision of top managers from headquarters. Such projects include a single authorization system in all SE services for company partners or the product ecosystem.

At the same time, the degree of involvement of such outsourced employees in all processes of the company is so great that they differ from the regular ones only by their mailing address and physical location. On the scale of a company operating in the same IT infrastructure for all countries, this approach has obvious economic feasibility.

State Risks

With all the advantages (rapid response, involvement in the project, etc.), staff members require a more careful attitude. Firstly, they can become too immersed in the internal specifics, get used to their standard tasks and stop developing. And the qualification of personnel is one of the components of success, especially in such an area as IT. You don’t have time to look around how competitors working with dynamic contractors will pass you around the corner.

Secondly, full-time employees work 8 hours a day, get sick, go on vacation, take time off for family reasons, and if they are absent, the load is distributed to the rest of the team. In the case of dismissal of a full-time employee, the selection and adaptation of a new specialist takes a lot of time and effort, especially if the specialist is narrow-profile, and within the terms of the project it happens every day. While the contractor can quickly replace the “fallen fighter”, the replacement in the team will not affect the work process.

In addition, the number of specialists in the internal IT department is limited, and the variability of each of them is low. This is normal when constant revision of the project or support of one large product is required. But when there are many projects and they are different, you will either have to unreasonably inflate the staff, or outsource some of the tasks anyway.

There remains the risk of information leakage. If a full-time employee decides to violate the non-disclosure agreement, customer data, partner databases, unique internal developments may be transferred to a new employer or made public. An employee knows more about internal processes than a contractor can. In the event of an information leak, the company risks not only losing profits, but also losing customer confidence.

Outsourcing Risks

Carefully study the estimates, compare offers, ask questions. Market realities are such that no one will work at a loss, and this is normal. But if some agencies openly show their profits, highlighting them in a separate article (agency commission), then others can use the complex terminology of IT-developments to hide the bloated budget, unreasonably increase the number of hours of work of specialists, or even add extra stages to the project . High price is not a guarantee of quality. Paradoxically, medium-sized contractors suffer from overstated estimates of large players in the IT market. They enter a tender with an honest development cost and are eliminated with the phrase “suspected dumping”.

Choose trusted contractors. It is more important for an unscrupulous outsourcer to make good money on a project than to perform a task efficiently, so you will have to control literally every step of it. This makes the contractor nothing more than a thoughtless executor and reduces the benefits of such outsourcing to zero. At the same time, you can learn about the mistakes made after signing all the acts, when the contractor cannot be held accountable. And you have much less leverage over external specialists than full-time employees.

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