outsourcing is one of the ways of "racing to the bottom

Those who are in IT industry will know that outsourcing is one of the ways of "racing to the bottom", just like why companies are relocating to low cost countries for production.
Outsourcing is beneficial to those IT Big boys as they can offer breadth and depth, and they increasingly are playing the role of main contractor and re-source again to secondary vendor.

With so many hands involved, there is definitely a drop in product and service standards, but now we have a tier-service standard, as long as the VIP users are not affected, then it is ok.

The sad state of affairs arise because IT is the classic example of more sellers than buyers.

If you flood the workplace market with a lot of cheap supply, "race to the bottom" will happen and the buyers will gleefully get the cheapest supply to derive maximum benefits.
Such short-term view will definitely haunt the buyer in future, as again with a lot of changing of hands (due to resignation, re-appointment of secondary vendor etc), it will result in documentation not updated or contain errors, and thus mistakes will happen, more so for those complex systems.Those who are in IT industry will know that outsourcing is one of the ways of "racing to the bottom", just like why companies are relocating to low cost countries for production.

Outsourcing is beneficial to those IT Big boys as they can offer breadth and depth, and they increasingly are playing the role of main contractor and re-source again to secondary vendor. With so many hands involved, there is definitely a drop in product and service standards, but now we have a tier-service standard, as long as the VIP users are not affected, then it is ok.

The sad state of affairs arise because IT is the classic example of more sellers than buyers. If you flood the workplace market with a lot of cheap supply, "race to the bottom" will happen and the buyers will gleefully get the cheapest supply to derive maximum benefits.

Such short-term view will definitely haunt the buyer in future, as again with a lot of changing of hands (due to resignation, re-appointment of secondary vendor etc), it will result in documentation not updated or contain errors, and thus mistakes will happen, more so for those complex systems.

It is all about GDP.

The cost of outsourcing to IBM adds to the GDP, which otherwise would have disappear under wage expenses if it is done in-house.

This is just one of the many ways of cooking up GDP numbers.