In our most recent Pulse Survey, we set out to understand how and where IT organizations are sourcing their IT needs. Specifically, we were curious to learn if the high U.S. unemployment and global economic struggle were adversely affecting offshoring trends. Much of what we heard indicated that this is indeed the case.
One of the questions in the survey, IT Outsourcing and Backsourcing: Are IT Jobs Returning to the U.S.?, asked participants if they still used offshore resources. Only a third of respondents (35.2%) affirmed that they did.
Even more telling, we asked if they believed that bringing offshored IT jobs and services back to the U.S. or bringing outsourced IT jobs and services back in-house should be a priority for U.S. businesses and IT and business leaders. An overwhelming majority (75.9%) replied yes.
We asked them to explain and many cited U.S. unemployment rates and the need to grow our economy. Comments included:
• We need to offer opportunities in our own country first. We have the talent.
• U.S. companies should keep knowledge workers local to grow the economy and create jobs for American workers.
• It's good for the economy; services offered in the home country are better.
• U.S. IT jobs should not be given to other countries for the same reason we don't want all others going external. The U.S. needs to support itself, and boost the economy...not put more people on unemployment.
• Offshoring causes more problems than it is worth....and we need the jobs here!
• We need the work in our country!
• We need the jobs.
Others pointed out that the perceived savings are exaggerated. Comments included:
• Business leaders do NOT fully understand the risk they are taking when they offshore to get "lower costs."
• Lots of hidden costs with offshoring—language, business experience, project management, legal fees.
Others cited quality issues as well as slow response and poor availability. Comments included:
• It slows down your ability to respond quickly to your customers' needs.
• We are dependent on an outside organization for availability.
• Unfortunately, I think many U.S. businesses are finding that quality and timeliness are more challenging to achieve than originally thought.
Of those who did not prioritize bringing offshored IT jobs back to the U.S., comments included:
• I feel that IT jobs are more prevalent in Asian countries and that the U.S. and Europe are good in marketing, sales, business contracts.
• Unable to compete with cost and lack of skilled U.S. IT Talent.
• Offshore has really helped the U.S. a lot.
• Free market always works.
• I think that having a global pool of IT talent is a good thing for U.S. businesses. If businesses can obtain lower-cost IT resources from offshore, without sacrificing quality or timeliness, then more power to them.
A third category of responses felt that the issue was not black and white. Comments included:
• It all depends upon the business model executive management wants.
• Every situation has a unique set of circumstances. Need to address each outsourcing engagement separately based on the factors of that unique engagement.
• I think the focus should be on increasing business. The world economy is going through a change. What we will see is a new global economy that is going to be more interconnected and dependant than before
• Complicated equation of cost, resource availability, project needs and
schedules. Case-by-case situation.
• I think companies need to make these decisions independently—determining what is the best solution for them.
Where do you stand on this important issue? Let us know by contacting STAR BASE at 513.245.0400 or firstname.lastname@example.org. Download the full survey report here.