Outsourcing is undergoing an evolution. Many large organisations have already outsourced ‘the plumbing’, from call centres to application management and desktop support. These operations have correspondingly matured and can offer predictable cost savings and efficiency gains.

More recently, however, emerging models of outsourcing – such as hosted cloud computing, software-as-a-service and managed services – have expanded the possibilities to new and uncharted territories.

The global market for traditional IT services is a staggering £500 billion, according to Forrester Research, which adds that despite a “tumultuous year in the world economy, IT outsourcers were well positioned to take advantage as companies looked to cut costs and potentially head count”.

Many large companies have already implemented obvious cost-saving measures offered by outsourcing, particularly in the area of offshoring. However, judging from many of the speakers at the Information Age Hosting, Outsourcing And Managed Services 2009 event, there is an increasing tendency for companies to look at their outsourcing partners as not just service providers, but as sources of innovation.

True, there is less appetite for new projects. However, according to the market watcher IDC’s annual IT and business services survey, there are still as many enterprises increasing their outsourcing budgets as lowering them.

“It is not all doom and gloom,” says IDC analyst Mette Ahorlu. “Fewer new projects will start, but projects that address crisis demands, such as cost cutting and work process efficiency with a short-term horizon, have a good chance [of being funded].”
Ahorlu’s predictions match those made by many of the speakers at Information Age’s event. Outsourcing, they agreed, is a complex undertaking but nevertheless one that can deliver cost savings and more, especially when the relationship is viewed as a mutually beneficial partnership, not a service contract.