With any business decision, there’s a trade-off. In assessing each decision’s opportunity cost, you weigh the pros and cons of each option while analyzing what you’re gaining versus what you’re giving up.
One common opportunity cost many IT organizations consider is whether to build an in-house delivery team or partner with a managed services provider. Many IT organizations would prefer to build their own full-time, in-house software delivery team. Although there are benefits to building an in-house team, it’s also incredibly costly—significant up-front hiring costs, overhead, and of course, time. These costs increase exponentially for large and complex IT enterprises that must frequently scale projects up and down.
Given the costs associated with building an in-house team, many IT organizations instead outsource or supplement their technical resources by investing in staff augmentation or managed services. In this article, we will provide an in-depth look at how and why your organization should weigh the opportunity cost of in-house versus managed services.