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Insourced staff paid a pittance but don't want to leave

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After the scourge of outsourcing rampaged across the industry in the 1990s and 2000s, you'd think any news of insourcing would be good news for IT professionals, especially those who prefer to work in a nice, warm, in-house IT department rather than the measure-every-minute world of consultancy.

At Australia's Yarra Valley Water, where 35 folks found themselves in a new job, the news was mixed, because while jobs were created they weren't well paid. Yet the new workers don't want to leave.

IT operations manager Craig Linley told the insourcing tale at Gartner's IT Infrastructure Operations and Data Centre Summit in Sydney this week and explained the company decided to insource after being challenged to find ten to fifteen per cent of savings in the IT budget. The fact Yarra Valley Water did not really get on with its outsourcer helped: Linley said the un-named outfit dropped the ball during handover from the previous outsourcer and never quite managed to convincingly juggle it for years afterwards.

Linley knew he couldn't pay market rates for skilled staff. Government entities in Australia seldom do, with stability, generous retirement savings contributions and flexible working conditions the trade-off. Yarra Valley Water therefore pays fifty to seventy five per cent of the wage skilled folks can get elsewhere.

35 people were happy to work for those wages.

“We appeal to young families who are sick of the daily commute who want to live within an easy journey of their workplace,” Linley said. “We attracted good staff through work/life balance.”

In almost a year since, just two have left. One was a square peg. The other only departed for family reasons.

Linley, meanwhile, has proved that insourcing pays: operational and capital expenditure are both down. The fact that Yarra Valley Water already owned its own kit helped. He's also had to remember that insourced staff take holidays and that time off means degraded capabilities. But that hassle is tolerable given measurement of users' attitudes to IT show vastly greater satisfaction levels and trust.

That's good news for Yarra Valley Water's IT department. Is it also good news for it's IT workers? Or for the folks at the outsourcer who may well have found themselves without a gig, either immediately or perhaps at all if outsourcing needs to go offshore to meet the price insourcing can achieve?

We'll leave those choices to you, dear readers. Do let us know if you value the folding stuff or a warm fuzzy feeling in the comments or here. ®

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