UK firms start to shun offshoring

Few companies have any plans to use offshore service providers, according to a recent survey

IT offshoring is an unpopular option for the vast majority of UK firms, according to a report released in May by skills body E-Skills UK.

The quarterly ICT Inquiry report revealed that only four percent of 1,000 UK firms surveyed had outsourced some of their IT or telecoms functions to an offshore services provider. And 94 percent of respondents said they did not currently offshore any IT or telecoms activities and had no plans to do so within the next two years. Only two percent were considering the use of offshoring in that timeframe.

Phillip Everson, partner in consulting at consultancy firm Deloitte, said he was surprised that so many firms were against offshoring. “It doesn’t surprise me that offshoring is not quite as popular as some would have it, but these are very strong figures,” he added. “If it was 60 or 70 percent of firms, I’d have expected that.”

Everson said part of the reason for the low levels of interest could be IT managers’ concern that offshoring would reduce the control exercised by themselves and their departments. “This is more a fear with offshoring than with outsourcing,” he argued. “Although there is also wariness about outsourcing at present, with reports of some large organizations taking outsourced work back in-house.