Assignment 8

Outsource or In-source



Most organization nowadays already engaged in automation. Technology plays a great role in the success of a business and to be competitive in the market. Adopting the way of technology, gadgets and hardware are necessary as well as its software and people ware. One of the wide issues covered by technology is outsourcing and in-sourcing. Every business, university or organization has to determine whether they should perform a service themselves in-source or outsource. However, it is not essential or required to limit the option by choosing only side of the coin because in business things are viewed in different directions to see the right angle to make the decision more accurate based on the current situation of the company.

Outsourcing refers to the subcontracting practice of taking company business functions and contracting them out to a third party. While, in-sourcing, is the opposite of outsourcing; it means “contracting in”. In in-sourcing, an entity or company personnel who can be said to be an expert in the field to be tested is the one who will deliver/create and manage what the university needs in regards to information system.

In taking the sides on where to stand between outsource or in-source depends on the situation of the school if what would be the best option for them. There are cases that outsourcing is a good thing to do. However, in-sourcing could also be a better choice if the school holds a number of skilled individual who can do programs better than what they can get outside. In any stand there are factors of advantage and disadvantage effects to the school. These factors are essential to know and identify well to come to the right decision in concern to the current situation and resources of the company.

Resources would be the biggest factor that can effect the decision whether to choose outsourcing or in-housing of information system. The company or the school would see to it that they have sufficient funds for their forwarded action. The decision is a case-to-case basis. As a decision maker, I must have the list of all the information, advantages and disadvantages between the two proceedings.

Here are some of the advantages and disadvantages of outsourcing and in-housing of Information System.

In outsourcing, some of the advantages are:
- through outsourcing it can be used to bring in new ideas and to train internal staff,
- it ca also increased productivity and it is more service guaranteed.
- lower personnel costs
- Can focus on your core competencies
- Don't have to worry as much about keeping current in outsourced activities
- Frees up space that can be put to alternative uses
- Increases speed of delivery for outsourced activities
- Increases quality of delivery for outsourced activities
- Frees up management time
- Can reduce cash outflow
- Focus On Core Activities - In rapid growth periods, the back-office operations of a company will expand also. This expansion may start to consume resources (human and financial) at the expense of the core activities that have made your company successful. Outsourcing those activities will allow refocusing on those business activities that are important without sacrificing quality or service in the back-office.
- Cost And Efficiency Savings - Back-office functions that are complicated in nature, but the size of your company is preventing you from performing it at a consistent and reasonable cost, is another advantage of outsourcing.
- Reduced Overhead - Overhead costs of performing a particular back-office function are extremely high. Consider outsourcing those functions which can be moved easily.
- Operational Control - Operations whose costs are running out of control must be considered for outsourcing. Departments that may have evolved over time into uncontrolled and poorly managed areas are prime motivators for outsourcing. In addition, an outsourcing company can bring better management skills to your company than what would otherwise be available.
- Staffing Flexibility - Outsourcing will allow operations that have seasonal or cyclical demands to bring in additional resources when you need them and release them when you’re done.
- Continuity & Risk Management - Periods of high employee turnover will add uncertainty and inconsistency to the operations. Outsourcing will provided a level of continuity to the company while reducing the risk that a substandard level of operation would bring to the company.
- Develop Internal Staff - A large project needs to be undertaken that requires skills that your staff does not possess. On-site outsourcing of the project will bring people with the skills you need into your company. Your people can work alongside of them to acquire the new skill set.


Disadvantages are:
- more expensive,
- risk in data security


While in in-sourcing some of the advantages are:
- less expensive,
- more likely to be data secured,
- easy to access the manpower,
- offers easy access to maintenance,
- IT support if any complications occurred.
In my own opinion, taking a stand on whether to outsource or in-source the IS functions of the schools would first require a thorough study on the matter. Define the pros and cons of the two situations and weigh the two against each other. The one that has more benefits should be the action that would be taken.

To take it seriously, choosing between the two without knowing the parameters and the situations to be considered in decision making is critical. In relation to the school, outsourcing maybe good and fair. Outsourcing is mostly made to organizations that do not have the resources in making the information system. All that is needed to do is to find the people who are capable and competent enough to do the job. Tap these people to do the work and let them do there task inside the school. Present to them the functions that the school wants to be the process of the system. After that, a little assessment to the system then waits until the system is fully made. In addition, the maintenance after the making of the system is also taken cared of by the provider. The school won’t problem anymore the installation and maintenance after. But, the greatest negative factor to it is the school need to allot money for hiring the people that is enough and sufficient to support the project all the way. In which, monetary is the problem in the school.

However, in-sourcing may offer advantages to the school. Since, we have the resources of people that are capable and competent to make the system it would lessen the budget in making the system. Aside from that the data are more secured compare if the maker of the system is from outside of the school. Since, in-source the maker of the system is more reliable to the confidential data of the school. On the other side, the makers of the system will mostly the faculty member of the school which probably affects the teaching performance of the faculty maker. Where the main purpose of the instructor is to inculcate its student would possibly affect. Since, we all know that the first priority of professors should be to teach and not to create or to manage the IS facilities.