IT sourcing strategy is required if you want your IT sourcing efforts to be successful. The thing is that modern businesses rely on their IT infrastructure for almost everything. Since business objectives progress, the importance of technology solutions is increasing. Therefore, it is critical for companies to obtain IT sourcing strategies for the procurement and discovery of IT resources and vendors` management. But what is IT sourcing strategy, and who can help you handle the process? Let’s try to answer this question.
What is IT Sourcing Strategy?
IT sourcing strategy is nothing but an approach to provide chain management that formalizes the way information is collected and utilized. Thanks to this, a company can put its own consolidated purchasing power to encounter the best values available on the market and align its business goals to purchasing strategy. These days, it is more advantageous for your organization to collaborate with a vendor. If you build a relationship with the vendor, you will create an IT sourcing strategy that makes it possible for the vendor to react to evolving business needs.
List of IT Sourcing Strategies
Further, you can find a list of the most popular IT sourcing strategies:
- Single sourcing. This one appears when an organization requires certain services and tools. The strategy is necessary to pick one company to serve as the supplier for this business. Thanks to this IT sourcing strategy, it is possible to reduce costs and provide product exclusivity, which can help the organization stand out from the crowd. The method also allows to streamline vendor management and ensure consistent service.
- Multiple sourcing. This approach implies that technology infrastructure and IT operations are contracted to several vendors, and organizations tend to combine them with a few internally provided information technology elements. This method is one of the IT sourcing strategies that allow competitiveness, flexibility, and mitigating risk connected with working with one vendor.
- Best-of-breed sourcing. Companies tend to buy software from a variety of vendors to get the best offering for each application area. For instance, an organization decides to obtain a human-resource package from one supplier and an accounting package from another vendor. This information technology sourcing strategy is popular because every company wants to have the best quality possible in every area. The thing is that vendors usually offer a variety of enterprise applications and state that their integrated system is the best solution, but the truth is that rarely all services are best-of-breed.
- Tactical sourcing. This IT sourcing strategy implies working with one provider during a short period of time for certain IT services, and this method allows companies to keep internal control over strategic IT resources. This approach is known for fast requisition, quote, and order processes. As a result, the organization can benefit from high-quality services, shorter lead times, and low costs.
- Strategic sourcing. This method implies a procurement process that includes spend analysis, data collection, negotiation, market research, and contracting. The IT sourcing strategy means that an organization develops long-term partnerships with vendors that align with the business goals of the business, creating a competitive advantage and driving innovation. It is possible to customize strategic sourcing to meet certain needs of a customer, but the main objective is to leverage an integrated system to increase profitability.
- Offshore sourcing. According to this approach, an organization hires a third-party company in a different country to get some work done. The benefit of this information technology sourcing strategy is that it allows a business to access talented experts or high-quality services while saving taxes and reducing labor costs. In short, it implies that the organization is able to pay less money while still using skilled resources.
- Nearshore sourcing. This approach implies getting services performed or work done by professionals in neighboring countries instead of the company`s own country. Organizations tend to use this IT sourcing strategy for jobs like technical support, software development, and call center jobs. Choosing neighboring countries allows easier collaboration and cast savings balance thanks to cultural similarities and closer timezones.
- Onshore (domestic) sourcing. This method implies getting services from outside the company but within its own country. One of the advantages is that the organization and the supplier have similar experiences and know everything about local issues and customs. This approach is one of those IT sourcing strategies that ensure localized knowledge, easier collaboration, and regulatory compliance.
- Insourcing. It is nothing but the process of utilizing your own company’s employees to perform a task instead of hiring a third-party organization. This approach can imply hiring a new professional to complete the required work or creating an entirely new team. The good part is that this information technology sourcing strategy offers visibility and better control. However, it might require extra investments in staff development and management.
- Co-sourcing. This is a hybrid approach where external service providers are introduced to in-house departments. It implies that the organization’s employees are going to work with outsourced professionals who may or may not be in the same office.
- Cloud sourcing. Using this IT sourcing strategy, an organization can outsource its operational needs and IT infrastructure. The approach implies utilizing a third party that keeps your applications and data in its data centers. This way, the company is able to increase operational efficiency, cost savings, and scalability.
- Crowd sourcing. This IT sourcing strategy means the gathering of opinions, information, or work from a group of independent experts or freelancers. Thanks to this method, an organization can save money and time while tapping into individuals with different skills to solve IT challenges.
- Green sourcing. This one differs from the above IT sourcing strategies because it implies choosing IT suppliers based on their commitment to sustainability and environmentally friendly practices. Thanks to this, it is possible to promote responsible business practices and decrease environmental impact.
- Vendor consolidation. It is nothing but a process that implies a reduction of the number of suppliers that an organization works with. They usually do that to achieve efficiency, cost savings, and quality improvements. At the same time, this IT sourcing strategy comes with a few challenges and risks that must be carefully managed and considered.
- Build-operate-transfer (BOT) sourcing. Even though this information technology sourcing strategy is a relatively new model, it is becoming more and more popular. According to this approach, the service provider runs, sets up, and maintains a system or IT service for some time. After that, it transfers the responsibilities and ownership rights back to the customer.
- Tech talent strategy. This method means researching, identifying, training, and engaging the best potential employees who can be suitable for the company. This is one of the helpful IT sourcing strategies because it allows businesses to identify and fill in missing skills. As a result, only organizations with this approach obtain a strong team that leads them to success.
If you are willing to help your business succeed with the help of talent sourcing, you should choose a reliable company, such as HR Bit. We will make a high-quality talent mapping for you to deliver the most helpful information about salary surveys, market peculiarities, trends, and the number of specific professionals of any country around the globe.
How IT Sourcing Strategy Can Impact Your Business?
Our world is becoming increasingly digital, which makes companies carefully consider the IT sourcing strategies they use to manage their IT services. Here are a few factors they must take into account:
- Thanks to single sourcing, they can optimize costs and streamline vendor management because they will work with one supplier for all IT needs.
- In the case of multiple sourcing, the organization can gain flexibility and competitiveness by working with a few suppliers for various services.
- If you choose the best-of-breed sourcing, the method will involve choosing outstanding providers on every IT domain. This is one of the best IT sourcing strategies if you want to access specialized expertise and the highest quality of service.
- Tactical sourcing differs from other methods because it is focused on short-term contracts with vendors, which can be useful if certain IT functions are required.
- If your organization requires a long-term partnership with IT vendors, then you should opt for strategic sourcing.
- If you need to enhance operational efficiency and scalability, you should prioritize cloud sourcing with other IT sourcing strategies.
As you can see, there are a variety of approaches that can help your organization effectively manage your IT services, but it is for you to decide which one is required.
Work With HR Bit IT Recruitment Agency
HR Bit happens to be an IT recruitment company that was created by a team of professional recruitment experts who have worked in the software development and startup industry for more than a decade. WeWe know everything about IT sourcing strategies and hired more than 400 developers for our customers.
All you need to do is to contact the HR Bit company and share your requirements. You will receive a free trial recruiting, while the company will provide you with the most impressive designers, developers, and marketing specialists for your remote or in-house team. HR Bit will help you solve any issue you are facing, let it be choosing the right IT recruitment sourcing strategies or anything else.
What is IT sourcing strategy? It is a method that can help your company grow and succeed. If you are looking for a company that can help you with recruitment sourcing strategy, you should go for HR Bit. We will provide you with the best professionals in the IT industry. Contact HR Bit for advice, and it will be one of the best solutions for your business.