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IT teams will shrink dramatically during the next five years as employers adopt competitively priced external suppliers for IT services, according to new research. And, employees lucky enough to stay in a job will find themselves dealing less with technology and assuming more of a business role by managing suppliers.

Gartner's latest prediction is that IT staff numbers will fall 15 per cent by 2010 as companies realize the potential efficiencies of bringing in external suppliers.

The analyst firm says IT departments will find themselves under pressure from suppliers offering prices and levels of professionalism that are difficult to match.

"As IT skills become a more important component of business professionalism, in-house IS staff while be displaced," Gartner said in a statement.

With that in mind, Gartner said companies must this year start the process of evaluating their long-term options - in other words, decide whether - and how - to compete against external suppliers or re-structure to manage those suppliers.

The changing nature of IT departments’ role means that by 2010 six out of 10 people affiliated with IS organizations will take-on business facing roles around information, process and relationships as they manage suppliers.

Departments who do not outsource will increasingly have outsourcing forced on them, according to Gartner. Organizations who do not adopt what Gartner calls "process-based delivery models" will see their service portfolios outsourced at a rate of 25 per cent each year.®

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Software as service: read the small print

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