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Ins and outs of outsourcing

Faced with a voracious need for information-technology (IT) help, many businesses are reaching for outside assistance. A new study of 154 companies by Cutler Consortium in Arlington, Mass., outlines the main reasons for contemplating outsourcing.

*Difficulty hiring skilled IT professionals (29%)

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*Lack skills in-house (20%)

*Budget (14%)

*Business changes (12%)

*Senior-management mandate (12%)

*Reorganizing (7%)

*Downsizing (2%)

*Other (4%)

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"It's interesting that budgetary concerns were cited by only 14%," says Mike Epner, a senior consultant. "Most respondents seem to view [outside] suppliers as a means to meet an immediate internal need, rather than as part of a long-term outsourcing strategy...."

It appears critical that companies nail down those long-term goals.

According to the Barometer of Global Outsourcing prepared by Murray Hill, N.J.-based Dun & Bradstreet Corp., between 20 percent and 25 percent of all outsourcing relationships fail in any two-year period. Half fail within five years - owing to poor planning for new and evolving business.

(c) Copyright 2000. The Christian Science Publishing Society