What is Application Outsourcing?
Applications outsourcing is an outsourcing arrangement for a wide variety of application services including new development, legacy systems maintenance, offshore programming, management of packaged applications and staff augmentation. Application outsourcing in IT is a rather general term for outsourcing processes involving business applications. This can involve many stages of the application life cycle, as well as consulting and related services.
Recent advances like cloud computing have made possible application outsourcing, which gives many businesses the option to delegate the work of building and working with applications to a range of third-party vendors and service providers. Vendors can utilize an "economy of scale" to specialize in certain application work that would be costly and burdensome for companies to source in-house. Modern Internet technologies like software as a service (SaaS) allow for more Web-delivered application handling and other kinds of third-party services. It leads to Reduced Overhead Cost, Reduced Cost of Labor, Freedom from Tools and Technology License Woes, Freedom from Infrastructure and Resource Maintenance Woes and Outsourcing Saves Time, Money and Resources.
In this era of immense intrinsic and extrinsic competition, it is the sole mantra of a business to be innovative, dynamic and the best in class. And to this, organizations need to focus on their core competencies and implement latest technologies available in the market. But no matter, however large and efficient capabilities organizations may have, it may still not be possible for them to implement an entirely self-reliant model that takes care of everything from start to finish. Somewhere, during the conduct of business, there are tasks such as back office, IT, accounts, HR etc that may end up taking more time and inputs than actually companies may prefer. Such important yet time consuming tasks can stall the business growth of an organization.