Seventhman Blog

  1. To Automate or To Outsource?

    "it outsourcing threat"To outsource or cloud-source?  That is not the question we’ve asked a decade back.  But with the rise of cloud computing comes automated tools that offer the same solutions – minus the complexity and higher cost that IT outsourcing offers.  The perfect mix of simplified applications and processes, coupled with working on a tight budget, may put a dent on IT outsourcing’s universe as we know it.  When businesses are signing more deals with vendors for less than what the contract is valued for, you start to wonder if outsourcing can survive amidst all these dynamic changes and disruption brought about by the cloud.

    Fear the Rise of the Machines

    I’ve been asked one time by this small business owner why he should outsource data mining tasks when he can use an intelligent web scraping tool that does the same job – for less. Besides, the pay-as-you go model costs way cheaper than the hourly rate of an outsourced data miner. Truth is, even those third party vendors are consumers of cloud services and it’s a no-brainer that you can also learn how to use these tools yourself.  When the cost of labor rises each year, enterprises are forced to look for integrated solutions that offer convenience, flexibility and security. Some may argue that outsourcing may cost more in terms of investment and the headaches that come with it may not be well worth it.  When more businesses are going global, it’s only smart to find the balance between the best talents and cost-effective technology around.

    Winning in the World of Agile Outsourcing

    If you’ve been in the outsourcing industry for quite some time, you know that challenges abound – from management, compliance to something as mediocre as time zone differences.  Now, those running a BPO need not to panic as cloud adoption is not yet that ripe to affect the business model in a huge scale.  Yes, the threat is there especially when cloud adoption is disrupting the sourcing marketplace.  Sure, there will be negative and positive consequences to watch for.  Those who are looking at the cloud for some leverage may be doing so because this is closer to the business – which means not having to oversee teams in multiple locations, not to mention having to deal with cultural and language barriers.  Would you say that everyone wants instant gratification these days?  There’s just this grey line between automation and outsourcing I can’t define, for argument’s sake.

    Are You Ready for a Hybrid IT Outsourcing Model?

    No doubt that we will see more companies looking for smaller, affordable deals that pack a punch.  Last time, I told you that 2014 will be the year of the Hybrids.  If IT service providers want to profit and compete, they have to look for ways to use automation to their end and bank on their customer satisfaction guarantee to ensure that clients will be loyal to their business.  Besides, these customers are smarter; they’ve realized that outsourcing is full of empty promises and they might be better off doing the jobs themselves (or, with the help of these new tools).  Outsourcing vendors need to step it up a notch and find new ways of differentiating themselves in a saturated marketplace.

    It will all come down to value-added services that offer real solutions to business problems; not just  a band aid fix.  On a lighter note, people are good at adapting to radical change so they may just find new jobs managing these machines.  Now, that’s ironic.

     

     

  2. Drawbacks of IT Outsourcing Revealed

    "IT outsourcing"With the sluggish economy and ceaseless debates around the subject, one can only wonder what outsourcing in this age of uncertainty really means.  Every company these days are trying to make ends meet on nearly every level, where they strive to bring value to their business.  While outsourcing may have been blamed countless times to the cause of unemployment, let us not forget that outsourcing is merely a business strategy helping an organization, large or small, survive and thrive .  To maximize productivity and minimize cost is not an easy fete, but it doesn’t mean a perfect solution either.

    Realities of IT Outsourcing You Need to Consider

    Despite the fact that IT Outsourcing is growing each year, even in places like China where English skills need to scale higher, many are still outsourcing some or most operations run by their IT Departments.  Whether be it a permanent or temporary fix to bridge the gap among cost, quality and manpower – outsourcing may seem like a salvation to many, that is if you are not too overeager to miss the real cost of outsourcing IT.  For example, if you are to move your IT functions offshore, you need to consider travel cost to the country of your choice, not to mention, other costs that may involve directly ( or indirectly ) with running your operations there.

    Calculating Beyond the Real Cost

    While you may think it will cost you less in the long run to get a third party service provider, you may have to consider the time factor when it comes to their familiarity with how your system and network really works.  If not, that can mean additional costs in training.  Then, there will be cases when you need something done a.s.a.p. and your outsourced IT provider must be inept to deal with issues right away, or you can suffer delay time which is not really good for any business.  Whether you’re outsourcing locally or offshore, you have to consider the worst case scenario to prepare yourself for the unexpected, just in case.  The problem is that plenty of contracts are sugar-coated and misleading, and no matter how urgent your needs may be, it helps to see a bigger picture that includes the real cost + long term benefits of having an outsourcing partnership.

    Outsourcing the Human Liability

    What drives companies to outsource these days is having access to first-rate IT expertise and resources that will yield more results and cost less.  Still, one must consider that anything, or anyone, can become a liability.  It does make sense to have your fine print well-defined, as well as backups, in case data is lost or stolen.  Yet, the question here is how much will it cost you when downtime happens because of these?  Will it cost you more if your team hasn’t worked for an entire day ( or week ) because the system crashed?  Is your team motivated enough to continue with your cause, efficiently?  Have you even considered the impact of cultural barriers that may lead to communication gaps?

    You may argue that any business is a gamble and it comes with risks.  Keeping a close eye is just a start and no matter how providers may offer free consultations, it’s only a sales pitch.  It will always come down to long term benefits and what outsourcing will really cost your IT dollars.  Choose wisely!