Out-sourcing of information technology services is becoming more prevalent everday. Much of the rationale for out-sourcing is to reduce service costs and increase capacity of internal staffing. While there are benefits of out-sourcing, the need to mitigate the risks associated with outsourcing deserve contemplation.
How can a manager know the optimal point for out-sourcing in which the risk of diffusion of subject matter expertise is adequately mitigated? (Balance expense management with knowledge management.)
To make these decisions optimally, a manager would need to consider answers to questions including:
1. What is the total cost of off-shoring? 2. What is the overhead for managing offshore resources? 3. What are the non-enconomic costs of offshoring?
What additional questions and knowledge preservation strategies can be considered by managers to assure internal/external decisions are made mindfully? Or, are there decision analysis job-aides currently available to help managers optimize internal/external staffing?
