06 December 2012

Trend: enterprise insourcing of IT

What's behind enterprise insourcing of IT? | TechRepublic: " . . . GM is not alone. Ford, Starbucks, Caterpillar, Google and GE all have made or are making insourcing moves. They cite factors like bringing products to market quicker, lower transportation and warehousing costs, better product and service quality, less rework, stronger intellectual property protection and a stronger “goodwill image” among Americans who are still struggling economically. “A major reason large companies are considering insourcing IT is out of fear that their in-house IT skills bases are eroding with outsourcing and that they no longer have the technology “wherewithal” to support or to innovate with their own technology resources,” confided one IT industry consultant who works with a major corporation who is moving to insourcing. Is excessive outsourcing ultimately a threat to American companies? Prognosticators like Paul Craig Roberts, who served as Assistant Secretary of the Treasury in the Reagan Administration, say “yes.” Robert described outsourcing as “fool’s gold for companies.” He went on to say that “Corporate America’s short-term mentality, stemming from bonuses tied to quarterly results, is causing U.S. companies to lose not only their best employees–their human capital–but also the consumers who buy their products. Employees displaced by foreigners and left unemployed or in lower paid work have a reduced presence in the consumer market. . . . ”

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