73% of Companies Outsourcing IT

According to preliminary results from an outsourcing study conducted by Cutter Consortium, 73 percent of companies surveyed outsource some part of their IT services. When asked which aspects of IT are outsourced, the top five areas were:

• Application development: 52%

• Hardware maintenance: 47%

• Training: 45%

• Web design: 40%

• Application maintenance: 35%

Fifty percent of the companies surveyed are currently outsourcing more than they did a year ago. The top two reasons for the outsourcing increase were satisfaction with a previous outsourcing experience (21%) and scarcity of qualified personnel (20%).

Michael Mah, a Senior Consultant on Cutter Consortium’s Sourcing Advisory Service and the Editor of IT Metrics Strategies says, "Companies want to reduce costs on legacy maintenance and redeploy assets to new applications development to enter new markets. Many companies are looking to access skills by buying them instead of ‘growing them organically.’ In many cases, companies also see an outsource provider as being able to help them speed process improvement. Whether this is the case ultimately depends on if an organization executes an effective metrics strategy to manage the contract and the service levels via a balanced scorecard."

For more information, visit www.cutter.com/consortium.