5 steps to kicking your IT outsourcing addiction

Increased flexibility, faster delivery, and -- yes -- reduced cost can be yours if you approach insourcing with these five tips in mind

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GM plans to at least double the number of its in-house IT experts over the next three years. The company currently outsources about 90 percent of its IT services and provides 10 percent of the work through internal resources. Within the next three to five years, GM hopes to reverse the percentages in part by hiring software developers, database experts, and other IT staff worldwide.

But the company doesn't just want technical expertise; it wants people who are proficient in technology and have a keen knowledge of business processes. "We're looking for IT professionals who understand our business and how we can make it better," Mott says.

One of the factors to consider when building up a skills base is which emerging technologies are most important to the organization. For example, if your company is looking to make a push into big data, what sort of business analytics skills will it need down the road? Or if you're looking to develop more applications in the cloud, what kinds of programming skills will you need to target?

Sometimes a company that's looking to move off outsourcing can find IT talent in its own backyard. Whit.li, a startup that provides relevance technology used by major brands for personalization and insights, tried offshore development of iPad and iPhone applications.

But the model didn't work, says CEO Jack Holt, and the company soon realized a more agile approach with developers nearby would better serve its needs. "We're a lean startup, meaning we release products with minimal functionality, get customer approval, then add more," Holt says. "This strategy, which most young tech companies and even big companies have adopted, is incompatible with IT outsourcing."

Whit.li didn't have to look beyond its hometown of Austin, Texas, to find many of the IT skills it needed.

"It's a strong second-tier city where Whit.li is perceived as the top of the list for cool tech companies to work for," Holt says. "Financially speaking, you get more work, faster from in-house talent. So the cost per release is around 20 to 30 percent lower and 40 to 50 percent faster."

Kick the outsourcing habit tip No. 4: Buy-in or bust

The decision to insource IT -- like the decision to outsource IT in the first place -- is a big step for any company. As with any significant IT initiative, if insourcing doesn't have strong support from the CEO, CFO, and key senior executives, it is likely to fail. At GM, it was important that the entire executive team support the planned change in outsourcing strategy, Mott says.

"Anytime a company is embarking on change, it is [critical] that your senior leadership is leading that," he says. "IT touches every element of the modern company; there's not a part of the business that is not touched in some way in terms of systems used. When you are going to make a fundamental change, then everybody needs to be ready to embrace that change."

The faster a company plans to make the change and the broader the impact of that change, the more vital it is that senior executives are on the same page as IT, Mott says.

In addition to having full executive support, IT needs to work closely with other areas of the organization, such as human resources, finance, product development, customer service, and sales and marketing, to determine how the move will effect those areas and to solicit input from non-IT representatives.

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