In-house, Out-Sourcing Conundrum
The challenge with In-Sourcing in any software discipline even when corporations deem themselves large enough to take on the technology industry by themselves, is multi-fold:
1. Often internal costs (wages ++) are not included in the total cost analysis, justified on grounds that these are fixed costs regardless of internal resource engagement in such endeavors or not. Why not use already paid internal skills? This view however distorts the true costs of implementation and the true bottom line value add potential.
2. Long term internal employees tend to stagnate over time, due to lack of technology exposure. In a rapidly changing tech world, it’s essential that external expertise and hands-on cross industry knowledge are thrown into the mix.
3. It’s not enough to be highly skilled in coding various platforms and systems. Process understanding, coding principles and best practice knowledge comes from having been exposed to, and being continuously involved with rapidly changing technologies, objective outcomes and projects across many industries.
4. If you are a producer, a non-technical business, why take on a whole new business model that hundreds of businesses and individuals have spent their career specializing in, gaining real practical knowledge of what works and what doesn’t.
5. Why compete to re-invent the wheel? The in-house development is local only and will never get a run for the money outside the business walls. Any missed technological opportunities (Bottom line value potential) will not even be realized.
6. Then there is the issue of when the key technical person inevitably leaves the business. What has been left behind can often be very intricate and complex or perhaps not even accessible, leaving the need to out-source after-all, and likely at much higher costs in retrospect.
In-sourcing or Out-Sourcing? In either case, make sure you compare costs in real terms, and most importantly ensure the legacies left behind are open source and using best practices that allow the next expert to take over.
Torben Kjaer
