Less coding, less outsourcing?

Will SOA take away a lot of outsourcers' business? Or will its impact be negligible?

As service oriented architecture has risen to the top of many enterprise to-do lists, there's been a lot of speculation about its potential impact on outsourcing. A couple of perspectives have shed some more light on the matter:

Speaking at ebizQ's recent SOA in Action conference (registration required), Ken Vollmer, principal analyst with Forrester Research, said SOA will likely reduce outsourcing, because its reuse paradigm "tends to reduce the level of coding that's required."  In many outsourcing arrangements, he observed, "coding is the primary thing that gets outsourced. If there is less of that, that means there is less things to be outsourced in the future."

Plus, if SOA succeeds in bringing technologists more in sync with business process management -- and more communication with end users, that makes it even the more difficult to outsource technology functions. "The systems architect, the process developer, and the business analyst would be more closely linked to the end users through business process management suite, and therefore less likely to be outsourced," he predicted.

The inclination to engage inside talent versus outsourcers also seems to be prevalent in SOA efforts. A new survey of 151 large enterprises, commissioned by BEA Systems and conducted by GCR, found that 70% intended to provide skills updates and retraining to existing staff as part of their ramp up to SOA.

As I've discussed before in this blog, it's likely that the net effect of SOA on outsourcing will be a wash. SOA can, and will, pare down many individual project costs to the point where less of it needs to be shipped out, en masse, to an outsourcer. But the volume of projects will steadily increase. At the same time, enterprises will increasingly access components and services from points throughout the globe, as well as their own internal functions.