Outsourcing IT needs in the corporate world has become extremely popular because it is cost-efficient and it gives IT resources to companies that may not otherwise be able to afford them. Another positive side effect of IT outsourcing is that it has brought many technology jobs back to the United States.

As convenient and patriotic as IT outsourcing has become, it also have several limitations that have caused many companies to re-think the idea of funding their own internal IT group. It is important for a company to be completely familiar with these limitations before developing any kind of company policy in regards to IT.

The Customer Could Outgrow The Outsource Company

When an IT outsourcing company first takes on a new client, the relationship is beneficial to both sides. But things can start to get inconvenient for the client when the client's business starts to outgrow the capabilities of the IT outsource group.

An IT outsourcing company can become entrenched in the daily routine of its clients, which is great at first. But when the IT company can no longer keep pace with the growth of its clients, then the clients are stuck trying to find a new solution and keep track of its own IT assets at the same time.

The IT Outsourcing Company Lacks The Necessary Technical Expertise

IT outsourcing clients like to believe that their support company knows everything there is to know about computers and the Internet. But every IT support company has its areas of expertise and they have the technical areas where they are not quite as strong. If the client starts to experience needs from the areas where the IT outsourcing company is not so strong, then that can become a significant business issue.

This problem can be amplified if the client is a small business experiencing growth. An IT outsourcing company is not as likely to bring on new personnel for a smaller client, which leaves the client without a solution.

The Client Losses A Measure Of Control Over Its Data

No matter how large or successful an IT outsourcing company may be, there will always be the limitation of client security and the protection of critical customer data. All it takes is one rogue employee of the IT outsourcing company to compromise all of the client's critical data.

Some IT outsourcing companies have safeguards put in place to try and prevent client data compromise, but those safeguards are limited by how much access the IT company has to the client network. In most cases, that access has to be comprehensive for the IT outsourcing company to be able to do its job.

Outsourcing IT responsibilities can take a lot of stress off of a client and allow that client to operate his business by focusing on his core competencies. But there are limitations to IT outsourcing that could make it necessary for a client to do his own IT support and pay the extra costs.

Memory management is always a priority in pretty much any programming language you would want to use. In the lower level languages such as C, there are a number of functions which help you manage the memory your application uses, but they are not the easiest to use. Some of the more modern programming languages such as Python, Ruby, Perl, and of course the subject of this article, Javascript all have a built in feature called garbage collection.

Garbage collection essentially means that the languages compiler will automatically free the memory being occupied by unused variables and objects, but there is no telling when this could occur. It is purely down to the compiler to decide when the garbage collection process should be initiated.

Machine learning systems are equipped with artificial intelligence engines that provide these systems with the capability of learning by themselves without having to write programs to do so. They adjust and change programs as a result of being exposed to big data sets. The process of doing so is similar to the data mining concept where the data set is searched for patterns. The difference is in how those patterns are used. Data mining's purpose is to enhance human comprehension and understanding. Machine learning's algorithms purpose is to adjust some program's action without human supervision, learning from past searches and also continuously forward as it's exposed to new data.

The News Feed service in Facebook is an example, automatically personalizing a user's feed from his interaction with his or her friend's posts. The "machine" uses statistical and predictive analysis that identify interaction patterns (skipped, like, read, comment) and uses the results to adjust the News Feed output continuously without human intervention. 

Impact on Existing and Emerging Markets

The NBA is using machine analytics created by a California-based startup to create predictive models that allow coaches to better discern a player's ability. Fed with many seasons of data, the machine can make predictions of a player's abilities. Players can have good days and bad days, get sick or lose motivation, but over time a good player will be good and a bad player can be spotted. By examining big data sets of individual performance over many seasons, the machine develops predictive models that feed into the coach’s decision-making process when faced with certain teams or particular situations. 

General Electric, who has been around for 119 years is spending millions of dollars in artificial intelligence learning systems. Its many years of data from oil exploration and jet engine research is being fed to an IBM-developed system to reduce maintenance costs, optimize performance and anticipate breakdowns.

Over a dozen banks in Europe replaced their human-based statistical modeling processes with machines. The new engines create recommendations for low-profit customers such as retail clients, small and medium-sized companies. The lower-cost, faster results approach allows the bank to create micro-target models for forecasting service cancellations and loan defaults and then how to act under those potential situations. As a result of these new models and inputs into decision making some banks have experienced new product sales increases of 10 percent, lower capital expenses and increased collections by 20 percent. 

Emerging markets and industries

By now we have seen how cell phones and emerging and developing economies go together. This relationship has generated big data sets that hold information about behaviors and mobility patterns. Machine learning examines and analyzes the data to extract information in usage patterns for these new and little understood emergent economies. Both private and public policymakers can use this information to assess technology-based programs proposed by public officials and technology companies can use it to focus on developing personalized services and investment decisions.

Machine learning service providers targeting emerging economies in this example focus on evaluating demographic and socio-economic indicators and its impact on the way people use mobile technologies. The socioeconomic status of an individual or a population can be used to understand its access and expectations on education, housing, health and vital utilities such as water and electricity. Predictive models can then be created around customer's purchasing power and marketing campaigns created to offer new products. Instead of relying exclusively on phone interviews, focus groups or other kinds of person-to-person interactions, auto-learning algorithms can also be applied to the huge amounts of data collected by other entities such as Google and Facebook.

A warning

Traditional industries trying to profit from emerging markets will see a slowdown unless they adapt to new competitive forces unleashed in part by new technologies such as artificial intelligence that offer unprecedented capabilities at a lower entry and support cost than before. But small high-tech based companies are introducing new flexible, adaptable business models more suitable to new high-risk markets. Digital platforms rely on algorithms to host at a low cost and with quality services thousands of small and mid-size enterprises in countries such as China, India, Central America and Asia. These collaborations based on new technologies and tools gives the emerging market enterprises the reach and resources needed to challenge traditional business model companies.

The innovators in technology have long paved the way for greater social advancement. No one can dispute the fact that the impact of Bill Gates and Microsoft will be far reaching for many years to come. The question is whether or not Microsoft will be able to adapt and thrive in emerging markets. The fact that Microsoft enjoys four decades of establishment also makes it difficult to make major changes without alienating the 1.5 billion Windows users.

This was apparent with the release of Windows 8. Windows users had come to expect a certain amount of consistency from their applications. The Metro tile, touch screen interface left a lot to be desired for enough people that Microsoft eventually more thoroughly implemented an older desktop view minus a traditional Start menu.

The app focused Windows 8 was supposed to be a step towards a greater integration of Cloud technology. In recent years, Microsoft lagged behind its competitors in getting established in new technologies. That includes the billions of dollars the emerging mobile market offered and Cloud computing.

Amazon was the first powerhouse to really establish themselves in the Cloud technology market. Google, Microsoft, and smaller parties are all playing catch up to take a piece of the Cloud pie. More and more businesses are embracing Cloud technology as a way to minimize their equipment and software expenses. While it does take a bit for older businesses to get onboard with such a change, start ups are looking at Cloud computing as an essential part of their business.

But what does that mean for Microsoft? Decisions were made to help update the four decade old Microsoft to the "always on" world we currently live in. Instead of operating in project "silos", different departments were brought together under more generalized headings where they could work closer with one another. Electronic delivery of software, including through Cloud tech, puts Microsoft in the position of needing to meet a pace that is very different from Gates’ early days.

The seriousness of their desire to compete with the likes of Amazon is their pricing matching on Cloud infrastructure services. Microsoft is not a company that has traditionally offered price cuts to compete with others. The fact that they have greatly reduced rates on getting infrastructure set up paves the way for more business users of their Cloud-based apps like Microsoft Office. Inexpensive solutions and free applications open the doors for Microsoft to initiate more sales of other products to their clients.

Former CEO Steve Ballmer recognized there was a need for Microsoft to change directions to remain competitive. In February 2014, he stepped down as CEO stating that the CEO needed to be there through all stages of Microsoft's transition in these more competitive markets. And the former role of his chosen successor, Mr. Satya Nadella? Head of Microsoft's Cloud services division.

Microsoft may not always catch the initial burst of a new development in their space; but they regularly adapt and drive forward. The leadership of Microsoft is clearly thinking forward in what they want to accomplish as sales of PCs have stayed on a continuous decline. It should come as no surprise that Microsoft will embrace this new direction and push towards a greater market share against the likes of Amazon and Google.

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