With the ever-growing popularity of cloud computing and SAAS, we have witnessed traditional IT infrastructure thinning down and software gradually moving up to the clouds. Then the rise of web2.0 brought us crowdsourcing and various online outsourcing marketplaces. And with these new tools and models, organizations must learn how to adjust their own IT workforce to operate effective in today’s ever-changing ecosystem.
Just as cloud computing have virtualized servers, storage and applications, cloudsourcing presents a new paradigm where a component of the IT workforce is also virtualized. In essence, cloud labor IS outsourcing. Except unlike traditional outsourcing of IT support operations to Indian outsourcing giants, we’re talking about outsourcing IT to online service providers. In recent years, web2.0 have brought us many online outsourcing marketplaces, such as Freelancer, eLance, and oDesk. These sites greatly commoditized the grunt work of programming because the lower cost and competent skills of providers in India, China, and Eastern Europe. Hence instead of hiring your own developers, much of the IT workforce can be moved up to the “cloud”.
The model have given organizations, especially SMBs a huge resource pool of IT talent. But what are some specific benefits of outsourcing online? Let’s take a look below:
1. Lower cost
This one’s a no-brainer, the majority of the providers online are from developing economies like India, China, Pakistan, Bulgaria, etc. Because of the lower cost of living in these country, providers can offer VERY competitive pricing as opposed to professionals from developed economies. In my experience working with online providers, hourly wage usually range from $5 to $15.
2. Competence and professionalism
Lower cost DOES NOT mean lower quality, in many cases the providers I have worked with online are MORE professional and skilled than professionals I’ve worked with in the U.S. and China. The reason is ALL of the online provider websites implements a system of reviews and feedback in order to keep both the provider and outsourcer honest. Therefore, online providers have a reputation to upload, which if tarnished by a buyer, can cost him future gigs.
3. Focus on your core business
Is IT your core competency? Your market market differentiator? Chances are, if you’re not Google, Sun, Oracle or the like, you DO NOT need to hire and develop your own IT talent? Just like a lot of big corporations outsourced their IT operations to India, now SMBs can outsource their IT workforce to the clouds. So the focus can be directed entirely on your core market differentiators.
4. Create a thin organization
Why hire full time staff to maintain your server? Build your website? etc. Instead hire your IT staff on a “need” or by-project basis. This way organizations can greatly reduce their overhead by only spending money when there are projects that bring IN revenue. In essence, the IT team will be consisted entirely of business analysts and project managers which tie closely to the organization’s long term business strategy.
Great! Let’s get rid of IT all together!
Hold on there, tiger! I didn’t say ALL of IT could go! Think about it, do you want someone else handling your requirements and analysis? How about managing your client relationships? Exactly… cloudsourcing gave us a huge talent pool that knows the “HOW“, but organizations still need to keep in house the people that knows the “WHAT“. That means keep your business analysts, project managers, directors… etc. BUT under one condition: they must all have some sort of an IT background, so they know what needs to be done in terms of development needs.
New IT Ecosystem
Whether you like it or not, change is HERE. Cloudsourcing have broken all national borders, and IT professionals are no longer competing for jobs within their own countries. Cheaper and capable IT professionals are popping up from various developing economies, and with that change, IT development skills are becoming highly commoditized in the marketplace. Now instead of complaining: “Their taking our jobs!” ADAPT and GROW with the new paradigm!