Outsource Data Processing

Economics of Scale, how and why enterprises are outsourcing data processing services

Published On August 08, 2023 -   by

Surviving and thriving in the post-Covid-19 market scenario is daunting for all businesses, especially with rising inflation and a weakening dollar. If you are a company in the USA, you are already dealing with fierce competition, demanding customers, complex regulations, digital disruption, and, of course, rising costs. It has become even more difficult to consistently deliver value-added services to your customers and differentiate yourself from rivals. But how is it even possible when your prime focus is on the various tedious tasks of data processing?

However, quite a few companies have recently been mulling to have an in-house data processing center. Setting up a data processing center could cost in the ballpark of $600 and $1,100 per gross square foot or about $7 million to $12 million per megawatt of commissioned IT load. If these figures are feasible, you are good to go. But, the compounding costs in the short and long term cannot be ignored.

It is quite apparent that an in-house data processing center tends to skyrocket your running costs and takes up valuable real estate, which could be better utilized for your business. Moreover, it can only be accessed through an onsite corporate network, and the IT department typically maintains it. It could cost upwards of  $10 million to $25 million per year, a significant amount for any business looking to enhance operations and eye expansion.

How can the data processing needs be met efficiently and seamlessly?

There are a few fairly viable alternatives. But let’s look at three alternatives to meeting your data processing needs.


While hybrid mode can reduce database size and memory footprint, speeding up the process and handling more volumes of data, there is little or no human resource to undertake data cleansing, data conversion, and data integrity. 


A colocation facility provides a business rent space for servers and other computing hardware for their data processing needs. However, access to human resources is unavailable for data processing services, like data collection, data cleansing, and overall data management.


Outsourcing your data processing needs lends you a competitive edge by allowing access to expertise or innovative technologies you don’t have in-house. It helps to get services rendered quickly and within set parameters. Outsourcing offers both cost efficiency and increased workload flexibility.

Why do Business Leaders choose to Outsource Data Processing?

Decades-old businesses featured at the top of the Fortune 500 list have zeroed in on Outsourcing Data Processing as a key determinant of end value and revenue generation. Big tech companies, including Google, Microsoft, and IBM, have been outsourcing quite a number of their business operations. Apple, Walmart, and   Slack have taken the outsourcing route.

As per Forrester’s research findings, over 60 percent of businesses are willing to go the outsourcing way to enhance their bottom lines and achieve their targets. Businesses are thus able to grow much faster by turning into lean and efficient business machines.

Industry pundits and influential advisors agree that such tasks should be handled by professionals with domain expertise and attention to customer-oriented quality delivery. Hence, outsourcing data processing is deemed a smart move that can help you achieve your targeted goals for 2023 and beyond.

Outsourcing eliminates the need to keep human resources on the payroll for data management tasks. There’s no need to invest in real estate to set up a data center, which is another major cost saving. ‘Saving on Time’ is a major relief for all businesses. As there is more scope for focusing on business growth and client satisfaction, outsourcing tops the list of steps toward organizational enhancement.

Why is the offshoring of data processing so compelling?

  1. The biggest driver for any business to offshore data processing is the competitive edge of having at their disposal skilled professionals backed by a robust infrastructure customized specifically for their industry.
  2. Offshoring doesn’t just improve efficiency and scalability but also eliminates the challenges of different time zones. Businesses can access services 24/7 without the hassle of continuous supervision.

The digital push in the insurance and real estate sector has, in turn, triggered increased adoption of offshoring. While AI-enabled automation is prevalent, the value of human involvement in handling client-centric services is best offshored to a reputable data processing vendor. Clients appreciate a well-curated and personalized customer experience that offshoring can sustain.

Contact our team today to outsource your data processing requirements for the best outcomes and quick turnaround times.

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