The coming year should find businesses looking for more ways to retain control over their IT services and processes, as well as cut costs, according to Computerworld’s “10 IT Outsourcing Trends to Watch in 2014.”
General Motors cited that need when it brought innovation back in a massive three-year plan to move almost all of its IT services in-house.
IT services experts cite three ways in which that trend is expected to continue: an increase in insourcing, a hybrid model combining insourced and outsourced offshore services, and companies opting to take on service integration themselves.
“Clients are recognizing that a solid internal service integration capability provides better flexibility and knowledge of the business required to onboard new and specialty service providers,” said Lois Coatney, director with outsourcing consultancy Information Services Group (ISG).
Automation is expected to increase. IT service providers have been experimenting with machines – “robots” — that can “learn” to perform increasingly sophisticated operations without human intervention.
“My sense is that the outsourcers see this [automation] as a threat, but also an opportunity,” James Slaby, a research director at HfS Research in Boston, told Dice News. So far, he doesn’t see automation as a threat to IT jobs in the U.S., since it’s used for routine work that was outsourced long ago.
While cloud services have become more widespread, companies are expected to to find ways to manage them more effectively, especially through consistent metrics that help make apples-to-apples comparisons of their options. Meanwhile, Indian outsourcers are expected to move beyond application development and business process outsourcing to offer infrastructure services.
“It would have been unheard of 10 years ago for an India-based provider to beat out an IBM, EDS, or CSC in an IT infrastructure deal in the United States or Europe,” Shawn C. Helms, partner in the outsourcing and technology transactions practices at law firm K&L Gates, told Computerworld. “I predict that 2014 will be the year where Indian-heritage providers become the biggest competitive threat for traditional U.S.-based infrastructure powerhouse providers.”