What is a potential challenge of insourcing?

In the context of insourcing, the choice of increased costs due to project development highlights a significant challenge that organizations may face. When a company decides to bring processes and projects in-house, it often entails higher operational expenses. This could be due to many factors, such as the costs associated with hiring, training, and retaining employees who might need specialized skills that were previously outsourced.

Moreover, once a project is developed internally, the associated overhead costs, such as maintaining equipment and facilities, can be substantial. Additionally, the potential inefficiencies that arise from a lack of experience in handling certain tasks may further inflate costs.

Insourcing can lead to the need for additional resources, and organizations may find that the time and investment required to develop skills and capabilities can have financial implications that exceed initial expectations. Thus, while insourcing can provide control and lead to a more aligned organizational strategy, the financial burden it can impose is a critical challenge to consider.