They tried that outsourcing IT thing where my wife works. They dumped the contractors and went back to in-house in less than two years. It doesn’t save a nickel long term. It just gets some bean counter a bonus. Naturally the bean counter doesn’t have to pay for the losses.
A company I worked at about 15 years ago decided it would “save money” by laying off the entire support staff and keeping only executives and technical people. Oh, except for the President’s and VP’s assistants. LOL
Everybody took turns as receptionist, which worked about as well as you might imagine. One senior exec kept getting complaints about clients receiving blank faxes. Turns out he was running them through upside down. He’d never sent a fax before!
At one point, the immediate boss and I were collating 120 notebooks for a seminar, and I pointed out that the total annual cost to the company for the two of us was no doubt over $200k. It was kind of silly for us to be doing work that could be done just as well by a temp.
Policy lasted about three months and was then quietly shelved.
In the corporate world it’s an easy way to tell Wall St that you bravely reduced head count and benefits liabilities by 15,000, for example, in order to bump or hold the stock stable.
Of course, those IT shops must still be manned so the corporation must hire back all those IT people from body shops that have sprung up to recycle those cut loose.
100,000/yr staffer = 48/hr
Contractor $100/hr with $60 to contractor and $40 to shop.
Corporate pays $208,000 ie double for the same staffer, same position.
Shrewd!