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February 16, 2021

Is Outsourcing IT Cost-Effective?

In the digital era, it’s hardly possible for a business to survive without at least a couple of IT specialists. Yet today, many companies prefer not to employ IT experts directly and opt for outsourcing. 

However, if you have never tried it, you may doubt whether it’s cost-effective or not. Let’s compare IT outsourcing to setting up an in-house department and see which one is cheaper. 

IT Outsourcing vs. In-House IT Department

The major opponent to IT outsourcing is an in-house department. It implies that a company creates a separate department, recruits staff, and manages their work. All these results in significant expenditures. Here are just some ideas for a debit column:

  •  Office rental fee – If you prefer traditional work, you can’t avoid renting an office. 
  •  Furniture – Of course, it’s the next step: you need to provide desks, chairs, shelves, and other furniture.
  •  Equipment – PCs, headphones, cameras, or anything else that an IT specialist may need. By the way, you will need high-performing computers with outstanding productivity. 
  •  Recruitment – If you run a business, you know how expensive it’s to hire an employee. Moreover, you will usually need to spend money on onboarding and training. 
  •  Salary – Yes, you should pay a monthly salary, which is typically high for qualified IT specialists.  
  •  Benefits and bonuses – Considering that IT is a highly-competitive sphere, you need to provide extra motivation. This may be rather costly. 

Now that we have identified potential expenditures for in-house development, let’s consider what you are going to pay for in IT outsourcing. It’s just a fee for the service. You don’t need to furnish the office or provide equipment. The fee can be compared to a salary that you are going to pay anyway. 

Now, we see that IT outsourcing is more cost-efficient indeed. It’s a crucial factor, especially if your budget is limited and you borrow some parts of your budget from an efficient loan service, such as

The Benefits of IT Outsourcing

To get a bigger picture, we should identify other IT outsourcing benefits. 

Access to a Pool of Professionals

You have a huge choice: freelancers and agencies from all over the world are ready to accomplish your tasks. It means that you can hire true professionals for some time. Of course, it will be cheaper compared to a full-time specialist. 

High Efficiency

You don’t need to align the work and spend time on furnishing and hiring. Once you select the agency or a freelancer and give the task, the work begins - no need to waste time on unnecessary things.

Lack of Personal involvement

If you choose to turn to an agency, you will get an aligned team of professionals that have their PM. It means that your job will be to assign a task and wait for the results to provide feedback. No day-to-day supervision. 

All in all, outsourcing IT is highly cost-effective as it’s cheaper and allows you to devote time to more meaningful tasks rather than monitor employees.

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