ICT outsourcing can be said as one of the current trends for companies around the world to contract ICT tasks and business processes to professionals anywhere in the globe. It is likely that ICT outsourcing started in the early 1990s where Kodak used external partner to handle its ICT resources. It was believed that Kodak did not have the expertise in ICT that they had to hire another company to help them handle their ICT needs.
This development occurs because companies would like to focus on their core business functions while outsourcing the non-core functions to experts to handle. This business model was tested and it was discovered that it helped minimize long term cost of hiring new ICT staff, train and retain over a period of time before they get a firm grip of the requirements of the job. ICT outsourcing has bridged the gap and helped companies save more money and time in the long run.
In Malaysia, ICT outsourcing is evolving as many companies are beginning to see its opportunities and benefits. After about 20 years, outsourcing is now needed by a lot of companies mostly at back-office processes and customer support. The Malaysian government in conjunction with a lot of non-governmental agencies is developing internal management systems to make this work. The government is investing massively in the computerization of its government ministries and agencies in order to boost its capacity and responsiveness to the people of Malaysia.
Presently, Malaysia is known as an ICT outsourcing hub of the world where it is currently ranked third globally behind China and India in the outsourcing industry. This shows how significant outsourcing is to developing countries in the Asian region. It’s obvious that outsourcing ICT has received so much attention and has become globally widespread; Malaysia has positioned itself as a big player and is doing all to retain it.
Reliability/Service – The risk of providing poor and unreliable service can ruin the whole outsourcing objective. Before a company goes into a contractual agreement with a third party, it’s important that the company needs to look for reviews either online or by word of mouth on the outsourcing party.
Security – The risk of porous infrastructure is a very crucial factor since ICT will be involving a lot of data sharing and would need data security. It’s important to ensure that the outsourcing party has the technical ability and trust to handle sensitive data.
Contractual agreement - The risk of not following contractual agreements whenissues come up is something to consider. Fortunately, most contractual agreements are bound by law and either party can sue or be sued when contractual obligations are not met.
Software development and maintenance
Webhosting and maintenance
Data archiving and security
Accounting package and software implementation
HR and payroll services
Before outsourcing your ICT needs, take note of the inherent risks and benefits to be derived. If done well, it could be a very cost effective approach to doing effective business. When managed poorly or with the wrong outsourcing company, a lot could go wrong.