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By Eric Lundquist  |  Posted 2003-04-28 Print this article Print

Garys comments are gentlemanly compared with comments I received from some upper-level IT managers who requested that their views not be attributed. That testimony from the front lines of outsourcing contends that IT employees who are transferred from a customer to a provider too often end up getting screwed. Staffs are often cut back to maintain the outsourcers profit margins; training evaporates because hours spent training are not billable, the managers say. As the outsourcing deal progresses over time, the customers realize they have less and less control over the IT infrastructure upon which their business strategies must run.

"Outsourcing doesnt cure headaches, it just changes them. You go from managing those activities internally to managing the outsourcer, which is often more difficult, since you cant just change outsourcers at will," said one IT manager.

Nonetheless, outsourcing is a reality. The pairing of IBMs technology and research operations with the business process expertise of PricewaterhouseCoopers makes a combination that is, IBMs Horton contended, "almost unbeatable." The IBM push to on-demand computing and utility computing, where a business pays only for the computing resources it requires, plays further to the strength of the outsourcing model, Horton says.

Im not going to outsource my homes IT operations, even though the system needs an overhaul and the IT manager—me—is untrainable. But the rush of headlines and stories about big outsourcing deals means that you will have to get a handle on the outsourcing business if you havent already. If you pretend it will not be an issue for your company, you will be passed by in the discussion. If you get ahead of the wave, you can design a plan that includes outsourcing as part of your IT infrastructure rather than as a replacement for it.

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Since 1996, Eric Lundquist has been Editor in Chief of eWEEK, which includes domestic, international and online editions. As eWEEK's EIC, Lundquist oversees a staff of nearly 40 editors, reporters and Labs analysts covering product, services and companies in the high-technology community. He is a frequent speaker at industry gatherings and user events and sits on numerous advisory boards. Eric writes the popular weekly column, 'Up Front,' and he is a confidant of eWEEK's Spencer F. Katt gossip columnist.

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