IT Outsourcing came to foray as a means for corporations to focus on critical business operations while having a specialized IT company take over the responsibility of managing the IT infrastructure and application development. For corporations especially in the developed countries, IT outsourcing provided two fold advantages, one was access to a highly talented pool of engineers and that too at a lower cost since countries like India were quickly growing their stature as an IT outsourcing hub.

IT Outsourcing is now as mainstream as ever and almost every leading organization outsources some or all parts of its IT infrastructure to a specialized company. It makes pure business sense and with tightening budget controls, IT outsourcing has become one of the strategic cost reduction driver for most organizations. Moreover, IT outsourcing is no more restricted to companies in USA & Europe outsourcing their IT projects to countries like India. Domestic companies within India itself actively use IT outsourcing including the Indian government like the India Post project given to TCS.

Is it then a no brainer that IT Outsourcing is critical to your business? Well, if it is cheaper and does not seem to have any inherent disadvantages why not!! Not really, IT Outsourcing despite proven benefits has its limitations and you should be cognizant be of the same before considering outsourcing your IT operations.

·         Limitations in estimating the actual cost of IT outsourcing:Let’s tackle the biggest driver of IT Outsourcing-Cost Savings. For anyone to estimate the cost savings from IT Outsourcing one needs to be able to predict the cost of outsourcing which then helps understand the cost savings from the same. Yes, at a higher level it is a matter of a simple $ per man-hour costs and IT outsourcing will appear to be cheaper in almost all cases. However, “hidden costs” are commonplace with IT outsourcing and it can be immensely difficult to accurately predict these hidden costs. For example, you need to be able to identify the costs of transitioning your in-house IT to an outsourcer, management overhead needed to manage the outsourcing relationship etc. In addition, IT outsourcing contracts are fixed at the start of the contract and as a result any additional requirement/change tends to be charged additionally. It is no surprise that IT requirements can change frequently and if your outsourcing contract doesn’t account for flexibility, you might be limited in the actual cost savings you might make. There is no surprise that there have been so many instances of IT outsourcing projects overshooting their budgets by a huge margin such as the one government shared services project going 500 million pounds over budget

Not too long ago, Apple added something phenomenal to the iPhone OS: a dashboard screen. If you have a Macintosh computer, you may be familiar with the dashboard that is available (regularly) by pressing F4. Otherwise, you can draw similarities to your Windows 7 Dashboard on the right hand side of your desktop, that shows you updates on your applications and widgets you add to it. Finding your dashboard on your iPhone is just as easy: just put your finger on the top of your iPhone screen, and drag down.

Here, in your dashboard, you will see all of the updates that has been pushed into such by your applications that desire to send you messages: things like new text messages, new updates to your subscribed magazines, your messages on payment applications. If you have reviewed a message set by an application by tapping on it, that message will automatically become deleted. However, if you don’t desire to go into the application to delete it, simply tap in the top right on the bar that categorizes that particular application, and tap again to clear all of the messages set by that application, and clear up your dashboard.

But, your dashboard isn’t all about your application. You not only get your messages, but you get important information set by default applications, such as the weather. If you don’t feel like scouting out your weather application amidst all your applications you have downloaded, simply go into your dashboard, and find out the forecast for the whole week, just by a simple swipe. Not only that, tickers for your stocks are displayed near the bottom of the dashboard.

No industry is as global as software development.  Pervasive networking means that software developers can, and do, work from anywhere. This has led many businesses to hiring development subcontractors in other countries, aiming to find good development talent at lower prices, or with fewer hassles on entry into the US.

While this is an ongoing and dynamic equilibrium, there are compelling reasons for doing software development in the United States, or using a hybrid model where some parts of the task are parceled out to foreign contractors and some are handled locally.

Development Methodologies

The primary reason for developing software overseas is cost reduction. The primary argument against overseas software development is slower development cycles. When software still used the "waterfall" industrial process for project management (where everything is budgeted in terms of time at the beginning of the project), offshoring was quite compelling. As more companies emulate Google and Facebook's process of "release early, update often, and refine from user feedback," an increasing premium has been put on software teams that are small enough to be agile (indeed, the development process is called Agile Development), and centralized enough, in terms of time zones, that collaborators can work together. This has made both Google and Facebook leaders in US-based software development, though they both still maintain teams of developers in other countries tasked with specific projects.

Localization For Americans

The United States is still one of the major markets for software development, and projects aimed at American customers needs to meet cultural norms. This applies to any country, not just the U.S. This puts a premium on software developers who aren't just fluent in English, but native speakers, and who understand American culture. While it's possible (and even likely) to make server-side software, and management utilities that can get by with terse, fractured English, anything that's enterprise-facing or consumer-facing requires more work on polish and presentation than is practical using outsourced developers. There is a reason why the leaders in software User Interface development are all US-based companies, and that's because consumer-focused design is still an overwhelming US advantage.

Ongoing Concerns

The primary concern for American software development is talent production. The US secondary education system produces a much smaller percentage of students with a solid math and engineering background, and while US universities lead the world in their computer science and engineering curricula, slightly under half of all of those graduates are from foreign countries, because American students don't take the course loads needed to succeed in them. Software development companies in the United States are deeply concerned about getting enough engineers and programmers out of the US university system. Some, such as Google, are trying to get programmers hooked on logical problem solving at a young age, with the Summer of Code programs. Others, like Microsoft, offer scholarships for computer science degrees.

Overall, the changes in project management methodologies mean that the US is the current leader in software development, and so long as the primary market for software remains English and American-centric, that's going to remain true. That trend is far from guaranteed, and in the world of software, things can change quickly.

In recent decades, companies have become remarkably different than what they were in the past. The formal hierarchies through which support staff rose towards management positions are largely extinct. Offices are flat and open-plan collaborations between individuals with varying talent who may not ever physically occupy a corporate workspace. Many employed by companies today work from laptops nomadically instead. No one could complain that IT innovation hasn’t been profitable. It’s an industry that is forecasted to rake in $351 billion in 2018, according to recent statistics from the Consumer Technology Association (CTA). A leadership dilemma for mid-level IT managers in particular, however, has developed. Being in the middle has always been a professional gray area that only the most driven leverage towards successful outcomes for themselves professionally, but mid-level managers in IT need to develop key skills in order to drive the level of growth that the fast paced companies who employ them need. 

What is a middle manager’s role exactly? 

A typical middle manager in the IT industry is usually someone who has risen up the ranks from a technical related position due to their ability to envision a big picture of what’s required to drive projects forward. A successful middle manager is able to create cohesion across different areas of the company so that projects can be successfully completed. They’re also someone with the focus necessary to track the progress of complex processes and drive them forward at a fast pace as well as ensure that outcomes meet or exceed expectations.

What challenges do middle managers face in being successful in the IT industry today? 

While middle managers are responsible for the teams they oversee to reach key milestones in the life cycle of important projects, they struggle to assert their power to influence closure. Navigating the space between higher-ups and atomized work forces is no easy thing, especially now that workforces often consist of freelancers with unprecedented independence. 

What are the skills most needed for an IT manager to be effective? 

Being educated on a steady basis to handle the constant evolution of tech is absolutely essential if a middle manager expects to thrive professionally in a culture so knowledge oriented that evolves at such a rapid pace. A middle manager who doesn't talk the talk of support roles or understand the nuts and bolts of a project they’re in charge of reaching completion will not be able to catch errors or suggest adequate solutions when needed. 

How has the concept of middle management changed? 

Middle managers were basically once perceived of as supervisors who motivated and rewarded staff towards meeting goals. They coached. They toggled back and forth between the teams they watched over and upper management in an effort to keep everyone on the same page. It could be said that many got stuck between the lower and upper tier of their companies in doing so. While companies have always had to be result-oriented to be profitable, there’s a much higher expectation for what that means in the IT industry. Future mid-level managers will have to have the same skills as those whose performance they're tracking so they can determine if projects are being executed effectively. They also need to be able to know what new hires that are being on-boarded should know to get up to speed quickly, and that’s just a thumbnail sketch because IT companies are driven forward by skills that are not easy to master and demand constant rejuvenation in the form of education and training. It’s absolutely necessary for those responsible for teams that bring products and services to market to have similar skills in order to truly determine if they’re being deployed well. There’s a growing call for mid-level managers to receive more comprehensive leadership training as well, however. There’s a perception that upper and lower level managers have traditionally been given more attention than managers in the middle. Some say that better prepped middle managers make more valuable successors to higher management roles. That would be a great happy ending, but a growing number of companies in India’s tech sector complain that mid-level managers have lost their relevance in the scheme of the brave new world of IT and may soon be obsolete.