Three reasons cloud and SOA will boost outsourcing

(Reprinted and updated from a post from December 31, 2009.)

A few years back, I published a piece on how SOA will enable outsourcing strategies. Since then, cloud-based services have burst on the scene in a big way, so it may be time to revisit the predictions. Here is an updated point of view.

As more enterprises adopt service-oriented architecture principals and practices, outsourcing may become an easier, more manageable option. SOA and cloud principles will boost outsourcing for three reasons:

• Busy IT shops — especially those with large enterprise systems — may not have enough human resources to effectively deploy SOA-aware and cloud-driven systems. IT managers, analysts, and architects will need to become business analysts, and spend a good deal of their time working with business units. They will either turn to third party firms either for assistance with SOA and cloud providers, or to take on IT-centric tasks to free up IT to better pursue SOA and cloud service provisioning.
• Infrastructures based on cloud SOA principles will lower the barrier of entry for outsourcing providers, which will in turn multiply their numbers, heightening competition and lowering prices. This will energize the outsourcing market.
• The growing standardization and "hot-swappability" of cloud services and SOA-aware components makes it easier to outsource — perhaps as cloud-based services — pieces of the IT infrastructure. This may make outsourcing less of the onerous either/or business decision it has been, as chunks of applications or services can be outsourced or brought in house as the situation fits, with minimal disruption to IT operations and priorities. As a result, we'll see more "micro-outsourcing" and less big-ticket-turn-the-whole-operation-over types of deals.