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IT outsourcing providers could profit from double dip recession

Stephanie Overby | Nov. 9, 2011
IT and business process outsourcing activity declined in the third quarter of 2011, but if the economy weakens, analysts expect more outsourcing--particularly offshore--in the coming months.

While many organizations shy away from public outsourcing announcements when unemployment is high and layoffs are looming, Fersht says that sending some of the remaining work to third parties can actually boost morale in corporate IT.

"You can only request your managers to increase their numbers of direct staff reports so much, and have them take on only so much extra work, until you get to the point of negative returns from your staff output," Fersht says. "Outsourcing can provide that opportunity to reenergize your top talent, [by bringing in] new resources and eliminating the ongoing cost-pressure."


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