Insourcing battles outsourcing

13:05 14th August 2008

IT insourcing is rapidly increasing as outsourcers find it difficult to maintain client service quality, a new survey has revealed.

The poll, conducted by Financial Object and Microsoft, found that two-thirds of UK private client wealth managers outsource IT to third party administrators, yet more than half would consider taking processes back in-house.

Respondents identified quality and cost as the most decisive factors when looking to outsource, however, three-quarters of those polled felt improvements could be made in these areas.

Particular areas for improvement were specified as mid-front office functions of asset management, client reporting and performance and trade execution.

The survey also discovered that 85 per cent of third party administrators would consider adding a third party tool if it increased their competitiveness.

Earlier this month, Gartner predicted that spending on IT services will rise by 9.5 per cent in 2008 and will continue to rise steadily in 2009.

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