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.

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When making a strategic cloud decision, organizations can follow either one of two ideologies: open or closed.

In the past, major software technologies have been widely accepted because an emerging market leader simplified the initial adoption.  After a technology comes of age, the industry spawns open alternatives that provide choice and flexibility, and the result is an open alternative that quickly gains traction and most often outstrips the capabilities of its proprietary predecessor.

After an organization invests significantly in a technology, the complexity and effort required steering a given workload onto a new system or platform is, in most cases, significant. Switching outlays, shifting to updated or new software/hardware platforms, and the accompanying risks may lead to the ubiquitousness of large, monolithic and complex ERP systems – reason not being that they offer the best value for an organization, but rather because shifting to anything else is simply – unthinkable.

There’s no denying that these are critical considerations today since a substantial number of organizations are making their first jump into the cloud and making preparations for the upsetting shift in how IT is delivered to both internal and external clientele. Early adopters are aware of the fact that the innovation brought about by open technologies can bring dramatic change, and hence are realizing how crucial it is to be able to chart their own destiny.

I suspect that many of you are familiar with the term "hard coding a value" whereby the age of an individual or their location is written into the condition (or action) of a business rule (in this case) as shown below:

if customer.age > 21 and customer.city == 'denver'

then ...

Such coding practices are perfectly expectable provided that the conditional values, age and city, never change. They become entirely unacceptable if a need for different values could be anticipated. A classic example of where this practice occurred that caused considerable heartache in the IT industry was the Y2K issue where dates were updated using only the last 2 digits of a four digit number because the first 2 digits were hard-coded to 19 i.e. 1998, 1999. All was well provided that the date did not advance to a time beyond the 1900’s since no one could be certain of what would happen when the millennia arrived (2000). A considerably amount of work (albeit boring) and money, approximately $200 billion, went into revising systems by way of software rewrites and computer chip replacements in order to thwart any detrimental outcomes. It is obvious how a simple change or an assumption can have sweeping consequences.

You may wonder what Y2K has to do with Business Rule Management Systems (BRMS). Well, what if we considered rules themselves to be hard-coded. If we were to write 100s of rules in Java, .NET or whatever language that only worked for a given scenario or assumption, would that not constitute hard-coded logic? By hard-coded, we obviously mean compiled. For example, if a credit card company has a variety of bonus campaigns, each with their own unique list of rules that may change within a week’s time, what would be the most effective way of writing software to deal with these responsibilities?