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Benefits of Global IT Sourcing

Sep 8, 2008
Most of the Fortune 500 companies are already reaping the benefits provided by global IT sourcing, such as increased productivity and lowered costs. Even though there is a lot of controversy over outsourcing, it has been shown that companies can substantially benefit from sending work to global sourcing providers. Some of the well known advantages to global IT sourcing are listed below.

Increased hours of operation. When working with a global sourcing provider, an outsourcer can have a department that runs virtually 24 hours a day. As the workday comes to an end in the United States, the vendor's employees will just be getting to work. Expanded hours of operation will increase the amount of time available to get a project done. Managers in the United States can review a project, make recommendations and send it back to the vendor. Once the IT manager returns to work the next day, the revisions will have been implemented and the development process will continue.

Access to qualified IT personnel. A Duke University study showed that many businesses are looking to global sourcing providers for qualified IT professionals, because there has been a steady decline in the number of engineering and science graduates in the United States. It is estimated that India and China graduate 12 times more engineers than the universities in the United States. The majority of graduates from these other countries speak fluent English, which makes global sourcing providers even more attractive to U.S. outsourcers.

Ability for rapid scaling of operations. Vendors can help an outsourcer grow or downsize its IT department quickly. By working with a vendor, an outsourcer can easily add or subtract new types of software.

Technical implementations are accelerated. Outsourcing companies can create new systems and business processes at a rapid pace by using a global sourcing provider. Many vendors already have the required hardware and software to complete a project, which makes it a seamless transition from the initial idea to actual product.

Flexibility of seasonal workforce. It is not uncommon for workload to fluctuate within the IT department. The number of projects being developed at any given point in time can vary throughout the year. Global sourcing providers give the outsourcer more flexibility. Vendors can be used on an "as needed basis," meaning they complete projects during the busiest times for the outsourcing company. Using a global sourcing provider helps avoid the hassle of hiring temporary IT employees.

Reduced costs. Most people are aware that there is a significant difference in salaries of U.S. employees versus employees from other countries. It is estimated that in some countries, IT employees earn less than 30 percent of a U.S. employee's salary, on average. In addition, global IT sourcing lowers the cost of production and operations, because it reduces the amount paid on overhead. When costs decrease, the financial position of the outsourcer should strengthen. As a result, there is more money available that can be used for core business services and new development.

Global IT sourcing has many great benefits and can be used as a strategy to boost overall productivity and increase the company's bottom line. An outsourcer should weigh these benefits against the associated risks.
About the Author
A&E Consulting is a full service consulting firm that has been successfully helping clients with their global needs. Visit http://www.globalsourceyourit.com or call 818-572-8399 for more information.
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