Bioinformatics as a service

Corporations are outsourcing most of the services that are needed for their business. Can Bioinformatics be one of them?

Over the past several decades, we have witnessed a growing trend of corporations outsourcing services. As communication technologies become faster and more efficient, ultra-large corporations that handle every task with their own employees are becoming increasingly rare. More and more companies are outsourcing or offshoring specialized functions such as IT, accounting, finance, and HR. Can bioinformatics also be outsourced by corporations?

My answer to this question is yes—with some exceptions. Let’s explore the advantages and disadvantages.

One of the key advantages of outsourcing is speed and specialization. For many organizations, executing a new task requires acquiring talent, training staff, and developing internal expertise—processes that can take considerable time. Achieving a high level of specialization may take years. Outsourcing bioinformatics services enables corporations to access expert-level capabilities immediately. In my opinion, this is the greatest benefit of outsourcing.

Another important advantage is flexibility. It is common for corporations to initiate projects that are later canceled at various stages due to shifting priorities or market conditions. In such cases, reassigning in-house personnel or implementing layoffs are costly and undesirable outcomes. Beyond the financial cost and time lost, these situations can lower employee morale.

While outsourcing analytical services does involve some sunk costs, these are generally easier to manage. Corporations can divide large projects into phases with defined milestones and decide whether to proceed after each one. Terminating an outsourced project typically has a smaller impact on internal operations than canceling an in-house effort.

That said, maintaining analytical services in-house also has its benefits. Chief among them is the ability to retain full control over data and workflows, reducing reliance on third parties. For routine tasks performed frequently, in-house teams may also offer long-term cost savings.

In my view, the decision depends on the organization's size, the frequency of analytical needs, and the nature of the work. For emerging biotech startups with limited headcount (fewer than 50 employees), hiring an in-house bioinformatician may be costly. Unless their analytical demands are substantial, it may be more practical to outsource all bioinformatics services.

For larger biotech companies, a hybrid model is ideal: maintaining an internal bioinformatics team to handle core and recurring tasks while outsourcing more specialized or one-off projects. In fact, many companies already apply this model for their IT operations, and a similar approach is well-suited for bioinformatics.

This hybrid strategy combines the advantages of in-house and external resources. Outsourcing offers rapid access to domain expertise, while internal teams provide oversight and continuity. With this setup, companies can better coordinate multiple service providers and may even transition routine operations in-house over time. Lastly, ending a contract with an external provider tends to be less disruptive than losing key internal staff.