"We started by looking at GM today and then looking at where we see opportunities for change and for doing business differently," says Randy Mott, CIO at GM. "Our leadership talked about opportunities to transition the way we do business in a lot of areas," as part of the lead-in to the decision to insource much of IT.
The company hopes that the move to insource more IT functions will result in increased flexibility in meeting the needs of colleagues and customers, as well as expedite the delivery of technology services.
Assessing whether your current outsourcing strategy is meeting your long-term goals is another key component of this corporate soul searching. WarSocial.com, a company that provides an online social strategy game, outsourced the first iteration of its gameboard, as well as the design of its logo and website. But the company has decided to almost completely develop everything in-house.
"It's really just a matter of quality. It will cost more to do it ourselves, but we aren't willing to sacrifice quality," says Dustin Hilgaertner, co-founder of the company. "We've also put a lot of effort into improving our own design skills and learning new technologies, so we can do the design and development ourselves."
The company had a few issues with outsourcing, Hilgaertner says, including the time it was taking to vet potential partners, inconsistent quality of service, and high turnover at the service providers once the contract was signed.
Kick the outsourcing habit tip No. 2: Cold turkey is not on the insourcing menuWhen it comes to moving off outsourcing, you can't just quit. The transition toward internal IT should be gradual, and you need to build time and budget into the process, especially when the insourcing push affects multiple entities within the organization.
"Understand that by no means is this transition an overnight process," says Andrew Schrage, founder and co-owner of Money Crashers Personal Finance, a provider of online educational services in areas such as credit and debt, investing, real estate, and insurance.
The company is in the process of bringing most of its outsourced technology projects back in-house because it feels much of the outsourced work has not been of high quality and has encountered numerous communication issues with its overseas provider.
"Our operation is small, and the transition is still taking us several months," Schrage says. "For larger organizations, the insourcing of previously outsourced IT can take as much as a year or even more to complete."
In many cases, the transition can be more expensive than the original move to outsourcing, Schrage adds. Cancellation fees, increased staffing costs, the expense of transferring software licenses -- it all adds up.