There was a short article in the New York Times about the benefits of outsourcing for small businesses. The article doesn’t deal with global outsourcing but just the concept of outsourcing itself.

The article will be helpful to you if you are thinking about outsourcing your software development and just cannot seem to find good programming talent to hire in your location. Instead of hoping for good programmers to arrive at your doorstep, you can have your own team of programmers provided by a vendor elsewhere in the world. And of course, it can be a lot cheaper than hiring employees.

The article offers these long term benefits of outsourcing:

• Control capital costs
• Increase efficiency
• Reduce labor costs
• Focus on your core business
• Level the playing field
• Reduce risk

OTOH, the article points out there are these risks to manage:

• Management: The outsourcing company must be prepared to manage projects across time differences and cultural barriers.
• Quality control: The outsourcing company needs a clear set of guidelines, expectations, and processes to manage the quality of products or services rendered.
• Taxes: Employing several outsourced for-profit enterprises can impact the taxes assessed on the outsourcing company.
• Liability: It can be difficult to determine the liability of different parties involved in complex outsourcing relationships.

But these risks can be managed and you can use a firm like Accelerance to do it if you need help. In summary the benefits of outsourcing, especially when you can’t find talent locally, can outweigh the risks.

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