Goodbye Outsourcing, Hello Insourcing: A Trend Rises

Thursday Feb 17th 2011 by Staff

One consultant says many companies are bringing some formerly outsourced IT work back in-house.

CIO: According to outsourcing consultancy TPI, the total value of IT outsourcing deals signed in 2010 was $62.4 billion, about the same as it's been for the last five years. However, David Rutchik of outsourcing consultancy firm Pace Harmon says he sees a trend toward insourcing. "Companies are still outsourcing significant projects and transactions," he says. "But they are strategically assessing subsets of broader outsourcing relationships and determining whether to pursue a best-of-breed provider approach or take it back in-house completely."

Common reasons for insourcing a previously outsourced function include poor service quality, failure to meet business objectives, and the company's desire for more control over IT.

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