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Two-thirds of businesses plan to increase IT outsourcing this year

Half of businesses that outsource IT are considering using outsourcing services more than they were last year, according to the National Outsourcing Association (NOA).

A total of 60% of business intend to outsource services that are currently run in-house. The financial services sector is the most confident about using outsourcing.

But businesses want more from their agreements. User businesses say they want to cut 15% from their costs from outsourcing deals. This compares to 10% reductions they demanded before the recession.

Martyn Hart, chairman of the NOA, said, "Outsourcing has traditionally been seen as a cost saving mechanism for business, so during the torrid 2009, it is not surprising that interest in outsourcing is continuing to grow. However, continued focus on cost above everything else, means that many are pushing through higher-volume, low-cost contracts over shorter time frames. This short-termism can be dangerous and these kinds of contracts frequently fail."

"That said, it looks like suppliers still have some work to do to ensure they are fully catering for what users want in 2010. This is likely to be an ongoing issue as users continue to seek new cost savings from less-mature providers and locations around the world."


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