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Asking for my stand whether to go or be favorable between insourcing and outsourcing, it simply depends on the usability, facility, resources and awareness of an organization. Making decision of choosing either of the two must be weigh thoroughly and definitely have the one which much significant and weigh as the useful and convenient of the organization. The organization must have consideration that must be taken and take account to such as financial, user-friendliness and accuracy.

Let’s first make the distinction between outsourcing and insourcing because they are often used interchangeably. Outsourcing refers to the subcontracting practice of taking company business functions and contracting them out to a third party. Outsourcing in the information technology field has two meanings. One is to commission the development of an application to another organization, usually a company that specializes in the development of this type of application. The other is to hire the services of another company to manage all or parts of the services that otherwise would be rendered by an IT unit of the organization.

Outsourcing involves the transfer of the management and/or day-to-day execution of an entire business function to an external service provider. The client organization and the supplier enter into a contractual agreement that defines the transferred services. Under the agreement the supplier acquires the means of production in the form of a transfer of people, assets and other resources from the client. The client agrees to procure the services from the supplier for the term of the contract. Business segments typically outsourced include information technology, human resources, facilities, real estate management, and accounting. Many companies also outsource customer support and call center functions like telemarketing, CAD drafting, customer service, market research, manufacturing, designing, web development, print-to-mail, content writing, ghostwriting and engineering. Offshoring is the type of outsourcing in which the buyer organization belongs to another country.

Outsourcing Vs Offshoring
Generally these questions strikes up when you have a project to outsource or offshore. We often mix both the terms though they have technical differences. Outsourcing is when a company hires some expert or professionals to complete a certain task. This can happen in many cases, including minimizing capital expenditure, high productivity, improved customer support and specialized skill. Outsourcing means corresponding with the provider or an expert within his area of expertise and getting the work done for the same. However, in offshoring a company can outsource its work or project outside the country or anywhere across the globe. The benefit of low cost, educated labor pool and pleasing time zones are diverting the attraction of many SMB’s to offshore their work around the globe. It indicates towards the assigning some particular function of a company to another country, which could be forever or for some given period of time.


Rising Globalization has led increasing number of outsourcing and offshoring projects around the world. Small medium organizations can outsource and offshore their business to compete with the large businesses across the global while cutting down on their expenses. This also brings good news for many freelancers and part-timers as they can get a chance to exhibit their expertise while earning a few bucks too.

But there is a lot of hidden cost involved in offshoring or outsourcing the project. Language barriers, cultural barriers and sometimes timezone challenges can be a hindrance in successfully executing the project. To overcome these barriers and to ensure successful outsourcing and offshoring there are many new online services which are coming to the online market. Elance, Guru, Rentacoder and LimeExchange are some of the interesting names which are coming into the business of outsourcing as well as offshoring. These services are affordable as they are not too heavy on pockets. They charge decent percentage of the amount paid to the provider after the completion of a project. Elance charges 8 to 10%, Rentacoder rates 15% but LimeExchange takes only 8% of the total amount, wherein it provides free registration and some impressive features to mitigate the risks related to outsourcing and offshoring.

Outsourcing enables companies to focus on their core competencies. Companies can have the following needs outsource to technology companies or outsourcing service companies:
1. Customer support or call centers.
2. Business process outsourcing such as accounting, billing and collections.
3. Telecommunications services and management.
4. Fulfillment, CRM and inventory management.
5. Technology hardware and software.
For example, USA companies are outsourcing software development needs to India and customer call center support to the Philippines. This is mainly done for economical reasons, as it is cheaper for these companies to have the service outsourced rather than done in-house.
Advantages of Outsourcing
The benefits of outsourcing are:
1. Less capital expenditure - For example, by outsourcing information technology requirements, a company does not have to buy expensive hardware and software.
2. Less management headache - For example, by outsourcing business process such as accounting, a company no longer has to hire and manage accounting personnel.
3. Focus on core competencies - Outsourcing non-core related processes will allow a business to focus more on it's core competencies and strengths, giving it a competitive advantage.

Reasons for outsourcing
Organizations that outsource are seeking to realize benefits or address the following issues:[12][13][14]
• Cost savings. The lowering of the overall cost of the service to the business. This will involve reducing the scope, defining quality levels, re-pricing, re-negotiation, cost re-structuring. Access to lower cost economies through offshoring called "labor arbitrage" generated by the wage gap between industrialized and developing nations.[15]
• Focus on Core Business. Resources (for example investment, people, infrastructure) are focused on developing the core business. For example often organizations outsource their IT support to specilaised IT services companies.
• Cost restructuring. Operating leverage is a measure that compares fixed costs to variable costs. Outsourcing changes the balance of this ratio by offering a move from fixed to variable cost and also by making variable costs more predictable.
• Improve quality. Achieve a step change in quality through contracting out the service with a new service level agreement.
• Knowledge. Access to intellectual property and wider experience and knowledge.[16]
• Contract. Services will be provided to a legally binding contract with financial penalties and legal redress. This is not the case with internal services.[17]
• Operational expertise. Access to operational best practice that would be too difficult or time consuming to develop in-house.
• Access to talent. Access to a larger talent pool and a sustainable source of skills, in particular in science and engineering.[4][18]
• Capacity management. An improved method of capacity management of services and technology where the risk in providing the excess capacity is borne by the supplier.
• Catalyst for change. An organization can use an outsourcing agreement as a catalyst for major step change that can not be achieved alone. The outsourcer becomes a Change agent in the process.
• Enhance capacity for innovation. Companies increasingly use external knowledge service providers to supplement limited in-house capacity for product innovation.[19][20]
• Reduce time to market. The acceleration of the development or production of a product through the additional capability brought by the supplier.
• Commodification. The trend of standardizing business processes, IT Services and application services enabling businesses to intelligently buy at the right price. Allows a wide range of businesses access to services previously only available to large corporations.
• Risk management. An approach to risk management for some types of risks is to partner with an outsourcer who is better able to provide the mitigation.[21]
• Venture Capital. Some countries match government funds venture capital with private venture capital for startups that start businesses in their country.[1]
• Tax Benefit. Countries offer tax incentives to move manufacturing operations to counter high corporate taxes within another country.
Disadvantages of Outsourcing
Before deciding on outsourcing your company's business process, keep in mind the disadvantages of outsourcing:
1. Less managerial control - It may be harder to manage the outsourcing service provider as compared to managing your own employees.
2. Outsourcing company goes out of business - If your outsourcing service provide goes bankrupt or out of business, your company will have to quickly transition to a new service provider or take the process back in-house.
3. May be more expensive - Sometimes it is cheaper to keep a process in-house as compared to outsourcing.
4. Security and confidentiality issues - If your company is outsourcing business processes such as payroll, confidential information such as salary will be known to the outsourcing service provider.
Criticisms of outsourcing
1. Quality Risks is the propensity for a product or service to be defective, due to operations-related issues. Quality risk in outsourcing is driven by a list of factors. One such factor is opportunism by suppliers due to misaligned incentives between buyer and supplier, information asymmetry, high asset specificity, or high supplier switching costs. Other factors contributing to quality risk in outsourcing are poor buyer-supplier communication, lack of supplier capabilities/resources/capacity, or buyer-supplier contract enforceability. Two main concepts must be considered when considering observability as it related to quality risks in outsourcing: the concepts of testability and criticality.
2. Quality of service
Quality of service is measured through a service level agreement (SLA) in the outsourcing contract. In poorly defined contracts there is no measure of quality or SLA defined. Even when an SLA exists it may not be to the same level as previously enjoyed. This may be due to the process of implementing proper objective measurement and reporting which is being done for the first time. It may also be lower quality through design to match the lower price.
Quality in terms of end-user-experience is best measured through customer satisfaction questionnaires which are professionally designed to capture an unbiased view of quality. Surveys can be one of research. This allows quality to be tracked over time and also for corrective action to be identified and taken.
3. Language skills
In the area of call centers end-user-experience is deemed to be of lower quality when a service is outsourced. This is exacerbated when outsourcing is combined with off-shoring to regions where the first language and culture are different. The questionable quality is particularly evident when call centers that service the public are outsourced and offshored.
4. Public opinion
There is a strong public opinion regarding outsourcing (especially when combined with offshoring) that outsourcing damages a local labor market. Outsourcing is the transfer of the delivery of services which affects both jobs and individuals. It is difficult to dispute that outsourcing has a detrimental effect on individuals who face job disruption and employment insecurity; however, its supporters believe that outsourcing should bring down prices, providing greater economic benefit to all.
5. Social responsibility
Outsourcing sends jobs to the lower-income areas where work is being outsourced to, which provides jobs in these areas and has a net equalizing effect on the overall distribution of wealth. Some argue that the outsourcing of jobs (particularly off-shore) exploits the lower paid workers. A contrary view is that more people are employed and benefit from paid work. Despite this argument, domestic workers displaced by such equalization are proportionately unable to outsource their own costs of housing, food and transportation.
On the issue of high-skilled labor, such as computer programming, some argue that it is unfair to both the local and off-shore programmers to outsource the work simply because the foreign pay rate is lower. On the other hand, one can argue that paying the higher-rate for local programmers is wasteful, or charity, or simply overpayment. If the end goal of buyers is to pay less for what they buy, and for sellers it is to get a higher price for what they sell, there is nothing automatically unethical about choosing the cheaper of two products, services, or employees.
Social responsibility is also reflected in the costs of benefits provided to workers. Companies outsourcing jobs effectively transfer the cost of retirement and medical benefits to the countries where the services are outsourced. This represents a significant reduction in total cost of labor for the outsourcing company. A side effect of this trend is the reduction in salaries and benefits at home in the occupations most directly impacted by outsourcing.
6. Staff turnover
The staff turnover of employee who originally transferred to the outsourcer is a concern for many companies. Turnover is higher under an outsourcer and key company skills may be lost with retention outside of the control of the company. In outsourcing offshore there is an issue of staff turnover in the outsourcer companies call centers. It is quite normal for such companies to replace its entire workforce each year in a call center. This inhibits the build-up of employee knowledge and keeps quality at a low level.
7. Company knowledge
Outsourcing could lead to communication problems with transferred employees. For example, before transfer staff have access to broadcast company e-mail informing them of new products, procedures etc. Once in the outsourcing organization the same access may not be available. Also to reduce costs, some outsource employees may not have access to e-mail, but any information which is new is delivered in team meetings.
8. Qualifications of outsourcers
The outsourcer may replace staff with less qualified people or with people with different non-equivalent qualifications.
9. Failure to deliver business transformation
Business transformation promised by outsourcing suppliers often fails to materialize. In a commoditized market where many service providers can offer savings of time and money, smart vendors have promised a second wave of benefits that will improve the client’s business outcomes.
10. Productivity
Offshore outsourcing for the purpose of saving cost can often have a negative influence on the real productivity of a company. Rather than investing in technology to improve productivity, companies gain non-real productivity by hiring fewer people locally and outsourcing work to less productive facilities offshore that appear to be more productive simply because the workers are paid less. Sometimes, this can lead to strange contradictions where workers in a developing country using hand tools can appear to be more productive than a U.S. worker using advanced computer controlled machine tools, simply because their salary appears to be less in terms of U.S. dollars.
In contrast, increases in real productivity are the result of more productive tools or methods of operating that make it possible for a worker to do more work. Non-real productivity gains are the result of shifting work to lower paid workers, often without regards to real productivity. The net result of choosing non-real over real productivity gain is that the company falls behind and obsoletes itself overtime rather than making investments in real productivity.
11. Standpoint of labor
From the standpoint of labor within countries on the negative end of outsourcing this may represent a new threat, contributing to rampant worker insecurity, and reflective of the general process of globalization. While the "outsourcing" process may provide benefits to less developed countries or global society as a whole, in some form and to some degree - include rising wages or increasing standards of living - these benefits are not secure. Further, the term outsourcing is also used to describe a process by which an internal department, equipment as well as personnel, is sold to a service provider, who may retain the workforce on worse conditions or discharge them in the short term. The affected workers thus often feel they are being "sold down the river."
12. Security
Before outsourcing an organization is responsible for the actions of all their staff and liable for their actions. When these same people are transferred to an outsourcer they may not change desk but their legal status has changed. They no-longer are directly employed or responsible to the organization. This causes legal, security and compliance issues that need to be addressed through the contract between the client and the suppliers. This is one of the most complex areas of outsourcing and requires a specialist third party adviser.
Fraud is a specific security issue that is criminal activity whether it is by employees or the supplier staff. However, it can be disputed that the fraud is more likely when outsourcers are involved, for example credit card theft when there is scope for fraud by credit card cloning. In April 2005, a high-profile case involving the theft of $350,000 from four Citibank customers occurred when call center workers acquired the passwords to customer accounts and transferred the money to their own accounts opened under fictitious names. Citibank did not find out about the problem until the American customers noticed discrepancies with their accounts and notified the bank.

Point of Views towards Outsourcing if it will be implemented in the university
When we talk of businesses outside world, outsourcing is very prominent. Almost every company adopts this system. The reason is simple, it is said to be the new concept in the business world that develops complex systems, elevates the economic growth, increases the competitiveness and enhances performance of the organization. Outsourcing is a great opportunity especially for the individuals who are lucky to have the job and it’s more advantageous for the company who is doing this kind of strategy. However, school is another story to talk about especially if we will talk about my very own school. Outsourcing could be of help in a way that the school can get programs outside that cannot be found or made inside the school. New ideas, strategies and implementations one cannot get we only rely on in-source. It would free the professors to teach students instead of trying to manage the systems inside the school. The professors would be given more time to spend with their students instead of trying to improve the Information System. The first priority of professors should be to teach and not to create or to manage the IS facilities. It would also lessen the worries involved. All the University has to do is to find a party that offers the services needed for the school including the maintenance/check-ups of the equipment to be used and to allot the appropriate budget for it. Troubleshooting and problems that arise would be the problem of the provider and not of the school. Of course the school will be affected if problems will arise but the solution for the problems should be given by the provider and not by the school.

Outsourcing will be better to our school but not in this time for the faculty and students are not yet ready for this kind of change

Insourcing is the opposite of outsourcing; that is insourcing (or contracting in) is often defined as the delegation of operations or jobs from production within a business to an internal (but 'stand-alone') entity that specializes in that operation. Insourcing is a business decision that is often made to maintain control of critical production or competencies. An alternate use of the term implies transferring jobs to within the country where the term is used, either by hiring local subcontractors or building a facility. Insourcing is widely used in an area such as production to reduce costs of taxes, labor (e.g., American labor is often cheaper than European labor), transportation, etc.
In regards to University issue about insourcing and point of view.
While, insourcing, is the opposite of outsourcing; it means “contracting in”. In insourcing, an entity or a company personnel who can be said to be an expert in the field to be tested is the one who will deliver/create and manage what the university needs (eg. Creating databases or websites). University security and integrity is much more ensured and there will be less irregularities and faster data compilation can be done because the person who is gathering it works in the company, thus he knows how the company functions and what is its exact needs than an person outside the company but I believe that outsourcing offers a lot more.
He’s familiar with the flow, he can figure out the best thing to do. Second, the school can lessen the cost if it will hire person inside, this is very important especially in the case of my school that the fund is very poor. Third, person inside can always do better, they can get ideas outside, and they can develop what they have. And lastly, the school can make sure that the information is safe and protected.
It is less hustle instead easy to access manpower. When the university wants to have outsourcing, they will look for the person/people to do the systems. It's a time consuming and more expensive routine. Rather than searching for an unknown well-being programmers, why not talked to the best programmers inside the university. Next, the system can be easily developed. Since the programmers is located inside, it is easily for that programmer to look for a new resource for the systems he/she made. He/she can observed what the university's needs. And other factors, he/she can suggest new things for the best of the systems he/she made.
Information’s confidentiality. Choosing personnel within a company can assure the company's operations and process kept secret because nowadays, its very hard to find trustworthy personnel. Second, with regard to expertise, we know that there are lots of skilled IT professionals who are working in this institutions, so why we need to get people not working within the company wherein we already have people who can make or perform that particular job.


But I rather choose the insourcing. Why? For the reason of patronizing our own resources. Resources in terms of making use your IT personnel, programmers and technical literate staffs to work hand on hand to make use their ability in making company own system which basically intended to they company alone. It will naturally address on the company needs and do make an accurate solution to solve the difficulty that the company is craving for.
In regards to the university I would suggest that it is better to buy an operated and functional system. Having the bought system and legally authorized to be owned by the university, what we going to do to be considered in inducing insource is when we will be able to develop it and technically improved by our skilled and brilliant staff. In doing so, we paid for the ready to use system but still we are the one who is responsible in developing it, it still cost-effective because we use the university staff instead of purchasing another system to address the future problem exist. It might be good in the part of the staff cause they will be able to practice their expertise at the same time involving into the actual scenario in which will be witnessed by the student and help them be inspired and motivated. It will challenge the staff as well as the student to do their best and yet be involved their selves and be the best.

Mediocrity knows nothing higher than itself, but talent instantly recognizes genius.
-Sir Arthur Conan Doyle


It just merely my opinion, I hope your not offended and consider my opinion. Thank you readers! Have a nice day and blissful day to all!

Reference:
http://www.ictstandards.com/IT_Outsourcing.htm
www.wikipedia.com