Bharti will have a better opportunity to focus more on key success capability by outsourcing its networking gear and IT services to external vendors, Ericsson, Nokia, Siemens, and IBM. Those Networks equipments and IT specialists are working with many different customers and that give them an ability to stimulate learning and innovation. If Bharti IT is in-house, it must encourage that rapid development of its IT capabilities in order to keep pace with network expansion rapid growth of customer base.
One of the big issues and problem there is that when the company is going to manage vertically related businesses that are strategically very different. A main disadvantage of Bharti of owning IT company or developing its IT in house is that the management systems and organizational capabilities required for IT development and design are very different from those required for operations. So, that shows and may explain the lack of vertical integration in managing strategically different businesses between development and service in one side and operation in other side. Furthermore, the outsourcing in network and IT services will help Bharti to focusing on its operational strategy by saving the time and effort of the management as well as focusing in marketing.
Another big issue here is that outsourcing will make independent suppliers and customers willing to do business with Bharti when it goes outsourcing. A major reason for that is Bharti will be recognized as supplier or a customer rather than as a competitor. And this advantage will make Bharti to be able to deal with more than one vendor to come up with the latest technologies and the lowest costs.
Outsourcing can be advantageous especially in responding quickly to new product development opportunities that require new combinations of technical capabilities.