Go from internal hiring to external hiring

At FAO, the IT division has been expanding its ability to deliver IT solutions by directly recruiting non-staff resources to meet the increasing demand. This continuous increase in directly contracted resources has become more difficult to manage, as it increases the burden of administrative processes. This also poses a challenge in managing and tracking the progress of deliverables and customer relationships. The result we have experienced is an exponential increase in the backlog of undelivered solutions, difficulties in meeting the SLAs agreed with customers, and a growing demand for additional people. We recently decided to seek alternative sourcing options, such as outsourcing many of our solutions and services to outside companies.

Including outsourcing as a delivery option poses many challenges and we need to look at various criteria before taking the step. In this article we will discuss some of the main considerations that are being taken in the IT division in relation to this transformation.

Below are the top three recognized benefits of going in this direction:

1. A simpler and faster onboarding process

It is increasingly difficult to find developers, also for short missions. In addition to the time required for recruitment, interview and negotiations, it also involves many lengthy administrative processes that do not allow for resources to be quickly on board, making it very challenging to leverage our deliverability with limited internal resources in a fast paced environment. .

In addition to this, the IT division is experiencing significant delays due to administrative expenses (these delays in terms of internal processes and procurement activities for new contracts are an important factor in limiting internal sourcing).

The problem of incorporation is limited in the case of external resources, it is enough to have the appropriate supply contracts in place and place an order accordingly.

2. Easy access to a global talent pool

It can be really difficult to get the right skills from our local resource group when a project involves new technologies or when the identified internal resource is already busy on another project. Outsourcing allows you to find the best qualified resources from specialized development companies, as well as the possibility of having these resources for the limited time of the project without the need to train an employee or move a resource from one project to another. . This typically ensures better quality work with faster turnaround time and a more cost-effective approach.

3. Scalability and continuation of work

Scalability is our biggest issue today. Some projects have short deadlines and require a great deal of additional development effort. Currently, this is mainly done by prioritizing projects and internally moving resources from one project to another or bringing in new resources that are not immediately trained or fit for the job. Establishing a partnership with a large outsourcing company enables consumption of resources on demand. We can plan the amount of resources accordingly only during the project time without worrying about training, recruitment, vacations and illness and, most importantly, without affecting the other projects already started. In fact, it is even possible to have a development going while internal resources are sleeping or when the office is closed. This means that our clients can access our services when this was not normally possible.

However, the switch to outsourcing could be challenging and it is important to also consider the following:

• Clear identification of why we want to go to outsourcing

It is common knowledge to consider cost reduction primarily as the main motivation for outsourcing IT solutions to external providers, however, in recent years the industry has evolved a lot and many providers have invested heavily in the quality of their services. Our research has shown that one of the main drivers of outsourcing is generally inexpensive, as subcontractors often offer more competitive prices for the same services with the same quality of service, whereas in the IT division this was not the one. Only factor to consider, as we also need the ability for staff to focus on more strategic functions while having a portfolio of services provided by subcontractors.

• Emotional journey

Going from an internalization model to an outsourcing model can be emotional, it is essential that this experience takes place in a collaborative and cooperative environment.

For example, having the resources at home is generally considered to allow changes in requirements to be accommodated much more quickly and dynamically. While this may seem like an advantage, it also presents many problems, such as a reduction in the discipline of providing clear and precise requirements and a proper delivery plan.

In light of outsourcing, internal resources must change their mindset and focus on delivering clear, detailed, and comprehensive requirements with a clear plan that includes milestones, deliverables, and customer input.

• Communication is key between internal and external resources

It is important to develop outsourcing capacity based on strong collaboration and partnership with external vendors, investing adequate time during the initial stages to ensure value is achieved throughout the process.

Outsourcing development is not an easy task, it is a journey that requires clear expectations and great realism on both sides.

The challenge for the CIO today is to leverage this experience to take full advantage of the full range of immediate and long-term benefits that outsourcing can bring to a business.

This could be in a form of a hybrid model where the outsourcing company is implementing a local interface and where internal resources are involved in some stages of development with the ultimate goal of owning the developed product, testing and implementation. It also gives the possibility of maintaining and expanding the product internally. Therefore, external resources are used to deliver a product and internal resources maintain control and ownership at all stages of the process.