In-House or Outsource: Deciding How to Manage Services
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In-House or Outsource: Deciding How to Manage Services

Though certain internal stakeholders may be offended by their institution seeking out service partnerships for particular functions, these relationships are critical to institutional efficiency and growth.


The decision to outsource online course development has been a rather controversial issue on campuses. Deciding to outsource may be relatively new for academic institutions in the realm of online course development, but the decision to keep services in-house rather than outsourcing to a vendor is not new for higher education administration.

Marketing, enrollment management, website development, graphic design, photography, food service, building maintenance, landscaping, housekeeping and even adjunct faculty are all outsourcing options that colleges and universities have embraced as the cost of doing business in a competitive marketplace.

Perhaps because the academic product — the courses and the full-time faculty who teach them — is what the faculty would like their institution’s reputation to be built upon, and any threat to their expertise and ownership in the creation of this product is suspect.

Understandably, given the amount of time and money the faculty have put into their own education, research and professional development, the use of an outside vendor to create courses for them would be considered an affront.

Despite the controversy, there are a number of sound options for those institutions that wish to outsource online course development. These vendors have access to seasoned course developers and subject matter experts who are credible, competent, and understand the pedagogy and andragogy of online education.

No matter what the professional service, with the decision to outsource or keep the work in-house always comes the following question:

When should an institution keep services in-house rather than outsourcing to a vendor?

Professionals I interviewed from the institutional side and the vendor side have differing opinions on this question.

Michele Steele, associate dean of curriculum and technology at Antonelli College Online, said institutions usually will keep services in-house when:

  • The budget does not allow for outsourcing; in-house development can allow for lower costs most times
  • The institution wants to own exclusive rights to what is being created
  • The information is confidential
  • The institution wants complete control of the project

Burck Smith, CEO and founder of StraighterLine, said there are two primary considerations:

  • Is there something particularly strategic about the service that can’t be done by someone else?
  • Is it more or less expensive to do in-house?

As an institution considers whether to keep any or all services in house, it would be beneficial to complete a SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis on the service area under consideration for outsourcing. These are the questions to ask of faculty or staff in the service areas:

  • What are your department’s greatest strengths?
  • What are your department’s greatest weaknesses?
  • What opportunities exist in the external environment or marketplace for your service area?
  • What threats exist in the external environment or marketplace for your service area?

By analyzing these strengths, weaknesses, opportunities and threats, an institutional leader is in a more informed position to make a decision. If the strengths and opportunities outweigh the weaknesses and threats, further consideration to keep services in-house are warranted. Likewise, if the weaknesses and threats outweigh the strengths and opportunities, it may be best to consider outsourcing.

With a completed SWOT analysis, a careful budget review, and a comprehensive look at the strategic goals and objectives of the institution, a decision to keep services in-house instead of outsourcing will be an informed decision.

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One Response to In-House or Outsource: Deciding How to Manage Services

  1. Ian Hollis Reply

    2014/01/15 at 1:07 pm

    Smith provides sound advice on the need to conduct a SWOT analysis prior to making any major outsourcing decisions. A concerning trend I’ve noticed in higher education is the use of external vendors not because they can do something better, cheaper or faster, but because other institutions have outsourced that particular function or service. It’s important to recognize that needs aren’t the same across institutions, and conducting an analysis will help institutions to avoid entering the wrong partnerships. At the same time, an analysis will give all stakeholders a clearer picture of why a partnership was or wasn’t pursued.

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