Covid-19 pandemic effects on IT outsourcing

I feel uncomfortable whenever I see the Covid-19 statistics during the day and think what people are going to suffer after it's over. I read different reports on leading newspapers and online blog posts and social sites. And everyone is saying the same think repeatedly.

I don't want to believe it but economic conditions are going to hurt after the pandemic is over. And current situation is no longer right at the moment. All over the world, governments have imposed complete lock down and many major cities halted and businesses stopped their operations. I am not economist and therefore I couldn't understand the long and complicated reports, however, I am able to understand the situation by observing others.

People are suffering mentally and economically.

Recently one of my contact - managing another outsourcing company - asked me about impact of Covid-19 pandemic on IT outsourcing. And then I started searching for the answers and compiled following options;

Remote work is the future

Yes, you read it right. Remote work is here to stay. Government imposed lock down allowed companies to think differently and then they asked their employees to setup system at home. So that they can work and product results.

Remote work isn't new concept. People were doing their business from remote places and that's how outsourcing started. Because of sharing work, people around the world could start working on same things. But some companies were reluctant to allow people to work from home because of many reasons. May be they didn't have remote work infrastructure or their managers were enjoying micromanagement.

Now, every IT outsourcing company is requesting IT department to setup remote infrastructure so that it won't suffer in such situation in future. Once done, company will prefer employees who can work from home and product results so that it can increase it's profit margin.

Company needs to invest in office infrastructure and remote work allows it to reduce investment in that area.

Average work is not going to reward any further

Now that's interesting aspect. I have seen many people - working in programming job - who are average and producing results that has low value. The company needs them because of certain aspects of programming where we really don't need much value. It will, however, change a lot after all.

Companies have already started creating or setting up remote work infrastructure. And this will allow them to hire average people on contract basis for short terms. There will be no obligation to keep them forever. The IT outsourcing team  will be hiring best or talented programmers so that they product more value in long terms.

Also, the average people will be earning less than what they are earning right now. The competition will be more in that range.

People will think twice before investing in IT outsourcing

So far IT outsourcing has seen good and large investment even after 2008 recession. People will, however, have different plans now. The Covid-19 has shown the true picture of our day to day requirement and what we really need in future. People will be investing in local employment and will be hiring local people - I do believe government is going to put some restriction here. It means the cut in IT outsourcing spending. 

It will mostly impact companies those are providing support or maintenance services to their clients. Other IT outsourcing companies will have less impact if they are providing value based services and engaged in real development works.

Now, company will also think about business continuity plan so that in case of similar event - I wish we should not face similar event in the future. 

I do believe there will many other negative impacts on the industry, yet I am positive that we - as programmers together - will thrive and bring back the revolutions.

In the end you need to take care of your IT outsourcing services and application development and spending so that you won't feel cheated and get real value. Our business installed remote work infrastructure since 2016 and then we started hiring best remote engineers - including local team members - for our team. Are you seeking real value from IT outsourcing team? I will be happy to provide free quotation for upcoming development work.