Hiring vs. Outsourcing IT Department - PowerPoint PPT Presentation

1 / 20
About This Presentation
Title:

Hiring vs. Outsourcing IT Department

Description:

Small engineering consulting firm ( 50 employees) ... Offered salary, health/life insurance, paid vacation and sick time. IT Outsourcing ... – PowerPoint PPT presentation

Number of Views:224
Avg rating:3.0/5.0
Slides: 21
Provided by: audreyr
Category:

less

Transcript and Presenter's Notes

Title: Hiring vs. Outsourcing IT Department


1
Hiring vs. Outsourcing IT Department
  • Team 2
  • Chad Hargrove
  • Gene Neeley III
  • Ian Reyes
  • Audrey Robbins

2
Project Goal
  • Decide Whether to Hire a Fulltime Network
    Administrator or Outsource

3
Project Scenario
  • Small engineering consulting firm (lt50 employees)
  • IS/IT department is not a core aspect of the
    company
  • Should we hire a network administrator or
    outsource?

4
Fulltime Employee
  • Network Administrator that maintains our internal
    computer network
  • Two Fulltime employees
  • Offered salary, health/life insurance, paid
    vacation and sick time

5
IT Outsourcing
  • Outsourcing is an agreement by which an
    organization contracts for the provision of IT/IS
    services from another firm
  • Data center management
  • Network and communications infrastructure
    management
  • User Support

6
Assumptions
7
Fulltime Employee
  • Salary - 60,000 per year
  • Bonus - 2,000 per year
  • Insurance Benefits
  • Office Space - 250 sq.ft./person _at_ 20/sq.ft.
  • Equipment
  • Desktop Computer with software

8
Fulltime Employee Cont.
  • Equipment cont.
  • PDA
  • Cell Phone
  • Payroll Taxes
  • Recruiting Costs
  • Training Costs
  • Administrative Costs

9
Outsourcing
  • 5-year contract
  • Includes
  • Technical expertise in network administration
  • Network storage
  • Data backup
  • Unlimited technical support

10
Analysis Details
  • Present worth of 5-year cash flow
  • To compare the cost (in todays dollars) with
    future cost, taking time value of money into
    consideration
  • Fixed output situation, goal is to minimize
    present worth of cost
  • 5 year analysis period

11
Present Worth Analysis
  • Hired Employee

12
Present Worth Analysis cont.
  • Outsourcing

13
Comparative Results
  • Employees
  • Outsourcing

NPV 781,745
NPV 546,589
14
Sensitivity Analysis
Employees
Outsourcing
15
Sensitivity Analysis Cont.
Special Projects
16
Advantages
  • Employees
  • Eliminates delay of calling external company
  • Can create/maintain a more specialized network
  • Outsourcing
  • Lowers Cost
  • Access all of your applications and data from any
    computer on web
  • Innovation without the risk

17
Disadvantages
  • Employees
  • More costly
  • Less technical expertise
  • Outsourcing
  • Depends on internet connection
  • Technical support hours may vary from the company
    outsourcing

18
Final Recommendation
  • Our recommendation is to select the outsourcing
    alternative in this case.

19
Resources
  • www.monster.com
  • www.provaliant.com/whitepapers/wp_cost_employee.ht
    ml
  • www.externalit.com

20
Questions?
Write a Comment
User Comments (0)
About PowerShow.com