Sunday, April 24, 2005

Outsourcing is failing the large employer market

There's quite a bit of Deloitte research out there on outsourcing in general. Much of it points to the positive impact of outsourcing, and a recent study notes outsourcing's failure. Ok - that's a bit dramatic I suppose. The outsourcing failure document (I have not read it yet) seems to focus on 25 large organizations that spend $50B annually. These are obviously VERY large organizations. The study notes that outsourcing will be right for some organizations if done for the right reasons.

My take is that large organizations need to control their service organizations and may only find decent ROI in application hosting. They will also have less economies of scale because they are already very large.