Blaming outsourcing for job losses is nothing new; critics have now got new reasons to blame the practice of outsourcing. The first one points out the flaws and vulnerabilities in software developed through an outsourced application-development process, and second one for not being as cost effective as claimed. Companies, which outsource software development for cost benefits, spend more on the IT security, and therefore they accrue more cost in the long run, says a recently released study conducted by Quocirca, a research and analysis firm.
The study finds that the customers, which outsource their application-development processes, face more challenges with respect to IT security than those who develop applications internally. And, 90 percent of the respondents who had outsourced 40 percent of software development admitted to being frequently hacked. For the study, Quocirca surveyed 250 IT professionals from Germany, the U.K. and the U.S.
In fact, 50 percent of companies outsource almost half of their code-development needs. And, more than 60 percent of companies don’t mandate security when they outsource the development processes.
“This is something that TS Ameritrade found out when it was forced to disclose in summer 2007 that personal details regarding 6.3 million customers had been leaked through a vulnerability caused by a programmer-created backdoor. At the same time, the company terminated the contract with the third-party organization,” quotes the study. Hence, the companies for whom software development is a business-critical tool are less likely to outsource the application-development processes.
At the same time, only 20 percent of the respondents, who outsource more than 80 percent of their software-related services, agreed that it is crucial to use external applications and internal code for interoperability.
In this scenario, German companies are less likely to outsource such processes while 61 percent of the companies from the U.S. will outsource more than 10 percent of the code development, according to the study.
