Outsourcing Toolkit

CIOs change outsourcing motives

Published: 13 Nov 2007 10:57 GMT

Saving money is no longer the top reason for IT outsourcing, according to a survey of more than 650 UK chief information officers and senior technology professionals.

Three-quarters of those surveyed said responsiveness and flexibility are the primary drivers behind their decision to outsource, research from recruitment consultancy Harvey Nash has revealed.

India is the most popular place to offshore, according to the research, with China coming second and the US third.

Of those surveyed, 53 percent expect their IT budget to grow next year and half plan to spend more than 10 percent of it on IT outsourcing programmes.

The vast majority (93 percent) of chief information officers plan to maintain or grow their current offshore software development activity in the next 12 months and nearly two-thirds (65 percent) are satisfied with the service they receive, the research revealed.

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Paul Smith, global managing director of outsourcing and software development at Harvey Nash, said it is clear IT outsourcing is here to stay, and it's no longer seen as just a cost-cutting exercise, with more and more businesses now reaping the strategic benefits and allocating their budgets accordingly.

As the reasons behind the decision to outsource change, Smith added, there will also be a dramatic change in outsourcing hotspots, with Eastern Europe and Vietnam already making a significant impact on the IT outsourcing map.