Smaller companies are more likely to gradually outsource individual functions than their larger competitors, according to an industry body.

The National Outsourcing Association (NOA) stresses that outsourcing means any work that is contracted out to another company, so it remains an important part of any small firm doing business, particularly if a firm lacks expertise in IT or legal affairs.

The group accepts that with eight in ten UK firms having less than ten employees then outsourcing their networking functions remains unlikely at this size.

However, NOA argues that as firms grow more and more operations develop the potential to be outsourced.

"You wouldn't expect a one man band to be outsourcing networks and things like that," said Martyn Hart from NOA.

"If you're employing nine people or more there's a likelihood that you might need mobile connectivity so you would outsource that, again to a local organisation but using the big networks," he added.

In a recent survey of SMEs for Connect, the two most important benefits of outsourcing were 'guaranteed response times' and 'allowing in-house IT staff to concentrate on more strategic issues'