The rise of outsourcing has led to the wide variety of services that are offered today. One of these includes IT outsourcing. This type of service refers to the effective delivery of business processes, application services, and infrastructure solutions for business results through the utilization of external service providers. IT outsourcing is now one of the most rapidly growing parts of the industry. Both big and small companies rely on the advantages this type of service offers as it helps their businesses cut costs on IT maintenance, tech support, and cyber security.

If you want to experience the leverage of IT outsourcing for your business, follow these steps!

Step 1: Choose your type of Outsourcing

You need to understand how IT outsourcing can be implemented. There are 3 main types of outsourcing that refer to where the service is provided:

3 Types of IT Outsourcing

  1. Onshore
  2. Nearshore
  3. Offshore
  1. Onshore Outsourcing refers to services provided by parties within the locality or within the country. Some businesses prefer this process due to the reason that they want to keep everything under control at a reasonable cost.
  2. Nearshore Outsourcing is the process of hiring professionals that are within the same timezone. This is an easier option to communicate with developers but this is not always profitable.
  3. Offshore Outsourcing is where a company gets services from parties residing in a different country. This type of outsourcing has proven to be the most cost-effective one.

Now that you know the three types of outsourcing, let’s delve into the best regions to outsource IT services.

Step 2: Choose your region to Outsource

One of the main reasons why a company would want to outsource its IT is because of the reduction in cost. Outsourcing IT services from different countries costs less.

Here is a variation of hourly rates from different regions.

USA – $100-$200 per hour

Canada – $40-$60 per hour

Western Europe – $60-$80 per hour

Eastern Europe – $35-$60 per hour

Asia – $20-$40 per hour

 

Although the cost is one of the main reasons for outsourcing, this is not the only factor to be considered in choosing which region to outsource IT. It is advisable that you find the balance between proficiency level, time zone, communication level, and prices.

Step 3: Choose which Outsourcing Model Works for You

There are 3 Common Models of IT Outsourcing.

  1. Project Based Model. This is where you hire a team to implement the part of work that is already planned and defined. The project manager from the outsourced team carries full responsibility for the quality and performance of the project. model is suitable for not complicated projects that have predictable and well-studied functionality.

Advantages: Can save time for your in-house team, clear timelines and the output, can help get things done quickly, fast hiring process, no micromanagement, and the full responsibility can lie on the project manager’s shoulders.

Disadvantages: You have less control over the project, there is a lack of flexibility, and the result may be well-planned but does not meet the industry standards and best practices.

  1. Dedicated Team Model. This is where you hire a team that will create a project for them, and they will work only on that project. Unlike the project-based model, a dedicated team is more engaged in your project. In this model, an outsourced team becomes your technical and product advisor. So it can offer ideas and suggest alternative solutions. This form of IT outsourcing works well for early-stage businesses that are anticipated to expand, complicated long-term projects with potential for growth, and projects with a lot of ambiguous needs. The dedicated team is the way to go if you want to validate your idea, identify a product-market fit, or construct an MVP to test the market.

Advantages: You have more control over the development process, you will be working with professionals with greater expertise in your specific industry, offers more flexibility, no micromanagement, provides extra time for your in-house team to work on the big picture, and lastly, the final products definitely meets industry requirements and solves the problem.

Disadvantages: You have more responsibility on the project and this provides a long hiring process.

  1. Outstaff Model. This is when you don’t require a full-fledged development team and engage individual specialists. You are free to hire outstaff employees to handle that scope of work if the project occasionally calls for the hiring of a few additional professionals. Because there is a possibility that your outstaff individuals will leave after a while, the outstaff IT outsourcing model is best suited for short-term projects.

Advantages: There is no need to hire the whole team, you can fill the gaps in your project fast, and there is flexibility to hire as many professionals as you need.

Disadvantages: There is a long search and hiring process and there is more time in the onboarding.

You now have everything there is to know about IT outsourcing! You can now decide which on each steps works best for you and your business.

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