Why the Pandemic Led to An Increase in IT Outsourcing

The pandemic has taken its toll on all of our lives. Personally, everyone has to adapt in their own ways. It has also affected the way we conduct business. All industries and niches had to change their business processes to adapt to the new world order. Such a pandemic introduces unknown risks, challenges, and rules. If not most of them, some companies are forced to ease up on their operations and ramp down production. Cost-saving is the name of the game in such troubling times. But other industries are experiencing an increase in demand. These companies are struggling to meet the customers’ demands. The IT outsourcing industry proved to be instrumental in the rising demand for IT products and services. It helps manage the changing working reality of the remote world. In this article, we will see how the IT outsourcing industry works.


The overview

This is an industry that is excelling in these trying times. The reasons for this are simple. It cuts costs for businesses. Also, it helps scale up the provided services while working remotely. As time goes by, many companies realise just how much beneficial it is to outsource IT projects. In turn, we can see a sharp rise in demand for the software development sector. These companies are working tirelessly to meet clients’ demands. Businesses are heading towards a cloud-based service model. And the software development sector needs to keep up its pace with this demand.

Another point to make is security. As IT technology becomes ubiquitous, so do cyber-attacks. Companies are making partnerships with IT firms to strengthen cybersecurity and account for cyber-attacks. Working remotely does come with an increased risk of a data breach. These are just some of the challenges of the IT outsourcing industry. 


Faster digital adoption

The pandemic has advanced the companies’ digital transformation by about six years. Considering this happened in a period of just a few months, that is impressive. Simply put, the pandemic forced all industries to utilise more indirect tools for work and communication alike. You guessed; these tools are digital in nature. New and old customers are demanding businesses to implement all kinds of technologies. They need to make their products and services more convenient, faster, and better than ever before. Companies will have to redefine their technology priorities event further. Business innovation will inevitably turn more towards digital solutions. Many of these industries do not have an established IT sector that is implementing the most modern technologies. That is why most of them will use some external support. Companies like Katana IT and much more help such businesses be on top of their game. 


Nearshore software development

Nearshore outsourcing is when a company delegates their IT projects to another company in a neighbouring country. This is done to cut costs and keep operational expenses under control, which is very important. Nearshore outsourcing offers many benefits that might not be immediately obvious. Such collaborations tend to enjoy the benefits of using the same or similar languages. Simply put, it negates the language barrier, in most cases. In the same vein, cultural proximity will prove very valuable in daily communication efforts. Lastly, the time zone will not be a hindrance. All teams can work at the same time. This means work can be done directly and in real-time. The opposite of this would be indirect communication, where different teams operate at different times. 


The talent pool

Outsourcing IT projects allows companies to tap into much bigger talent pools. Think about it. Technology made it so that distance is almost irrelevant. You could hire someone on the other side of the world. This allows businesses to hire people much more qualified than those in-house. It is a simple cost to benefit ratio. Being able to hire anyone you wish breaks the distance and visibility limit we used to have. You can choose someone for your particular needs without having to worry about time and distance. All you have to worry about is if you can afford them and their expertise. Make sure you leave your software development into the hands of someone capable. Yes, you do have access to a much greater talent pool, but always verify if they know what they are doing. 


Cost efficiency

As mentioned before, outsourcing your IT development can save you a lot of money. You can use these finances to cover operational expenses, salaries, benefits, administration, or even invest further. Simply put, outsourcing enables us to select the best talent at the best price. If you are willing to look around, that is. More often than not, these ratios are better than hiring full-time employees in your own company. In today’s globalised market, everyone is highly specialised. Even the largest of megabrands have their bread-and-butter processes perfected. Only then do they branch out to other areas. The reason for mentioning this is simple. The world is headed towards an outsourcing-based business model. Everyone will delegate certain business aspects to someone else. It will simply become that cost-effective. 


Lastly, the pandemic will eventually end. But the consequences on our lives will remain permanent, to an extent. The business world will forever be altered by the actions we take during this period. Outsourcing will become more prevalent as time goes on.



Mark Munroe is the Creator and EIC of ADDICTED. He's ADDICTED to great travel, amazing food, better grooming & probably a whole lot more!