50% of IT budget spent on infrastructure outsourcing: 2012 Bluewolf Survey report

According to new survey report released by Bluewolf, a global consultancy service company, IT outsourcing market is growing. According to the report titled “The State of IT Outsourcing-2012-2013”, IT outsourcing which was once a tool to cut costs, has matured to become a tool that has the potential to transform the business model itself.

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The survey report claims that productivity and profitability, flexibility to use resources and access to experts and professional talents remain as the top drivers for IT outsourcing in 2012.  According to the survey report, when a company decides to outsource, they decide on the sourcing model by considering the overall cost and impact on the organization and the degree of control they will have on outsourcing.

About the survey

The global consultancy services conducted a survey among 200 IT executives from the enterprise to SMB levels to know about the current status of IT outsourcing.  The survey was commissioned by focusing on two key areas:

  1. The frequency in which IT application and infrastructure services was outsourced.
  2. The sourcing models such as managed service providers, consulting firms, staff augmentation, offshore providers etc that was used to outsource IT services.

Key findings from the survey report

  1. 73% of respondents outsource application services and 62% plan to outsource infrastructure services.
  2. An average of $0.48 of every outsourcing budget is spent on application services while an average of $0.35 of the outsourcing budget is spent on infrastructure services.
  3. About 44% of IT outsourcing budget is allocated for application services and 50% for infrastructure services by SMBs.
  4. Midmarket firms allocate 51% of their IT outsourcing budget on application services and 26% on infrastructure services.
  5. Large enterprises allocate 49% of their IT outsourcing budget in application services and 28% in infrastructure services.
  6. About 10-25% of annual IT budget is allocated for outsourcing.
  7. 16 % of data center operations outsourced are managed on the cloud.
  8. According to 32% of respondents, the allocation of budget for outsourcing in annual IT budget will increase in next 12-18 months, while 9% are of the opinion that it will decrease. 52% of the respondents said that there will be no change in the allocation and 7% of them are not sure about the change.
  9. In application services outsourcing, 26% of the respondents outsource application maintenance services, 46% outsource application development, 39% outsource web and mobile application development and 28% goes for application hosting outsourcing. 30% of the respondents are of the opinion that they will outsource more application services in the future.
  10. In IT infrastructure outsourcing, 15% of the respondents outsource IT security, 23% outsource data center operations, 12% outsource help desk, 17% outsource disaster recovery, again a 17% of respondents outsource database administration and 16% outsource network operations.

You can view the entire report by following the link.

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