Should You Outsource Your It Support Function?
Outsourcing key business functions is not a new concept, but the business case for outsourcing IT support has never been more compelling.
Unless your core business activity is IT then a few of the key question you should ask yourself include:
- Does having an in-house IT support team enhance my businesses enterprise value?
- Should my peoples time and effort be invested in non-core functions and activities like IT support?
- Does it make sense for me to continue to try to hire and retain IT technology experts?
- Can we achieve economies and the inherent resilience of scale with an in-house IT support team?
- Can you afford to keep pace with the rate of technological change?
- Can you effectively control your IT budget in the face of escalating IT staffing costs?
It’s likely that the answer to many, if not all, of these questions, is no for most businesses.
But there are other factors to consider when contemplating the merits of outsourced IT support services versus an insourced model.
Now more than ever IT is a 24x7x365 feature of all our business and everyday lives. It’s the way we communicate, it’s how we organise ourselves and it’s at the core of business operational functions. Handling this effectively demands flexible, performant, scalable, secure infrastructure and, given its criticality, it needs to be expertly managed.
Total Cost of Ownership
Moore’s law underscores what we all know, the unit cost of IT continues to reduce as technology improves and evolves. But this does not usually mean that IT budgets reduce, instead, it means that we deploy more technology – a bit like extra roads, in time, equal more traffic, not less. Against this backdrop continued competitive advantage can be found in sourcing and managing this technology at the best cost point. Here economies of scale play a critical part in driving maximum discounts on hardware and software and in efficiently managing it. Logically sourcing this through an IT Service provider whose business is to source and manage IT should drive lower total cost of ownership. You can take steps when contracting to make sure that this is the case with features like benchmarking, competitive tendering and shared risk/reward models with suppliers.
The Inherent Resilience of Scale
Business success in 2020 can be as much down to effective risk management as a competitive advantage. You can build resilient technology but what about the people who operate and support it? Having an in-house IT support team of fewer than 10 people, (which is a typical format for most companies, other than enterprise-scale businesses) represents a significant risk. Staff attrition, holidays and topically, health and medical emergencies, are all tangible threats to business continuity. Working with a managed IT service provider mitigates this risk since they will typically have much larger teams of people, often geographically dispersed making them much more resilient than an inevitably smaller inhouse team.
Increased digitisation necessitates stringent cyber security measures. Insourcing your IT infrastructure management makes security solely your responsibility. It will fall on your IT team to deal with breaches, encrypt data, and to maintain compliance with regulations. Outsourcing your IT passes most of the day to day responsibility for this to the experts. As standard, companies that offer IT outsourcing services invest in and maintain best practice cyber security implementations. They focus on hardening security posture and continuously refresh and renew their technology in support of new threats and risks. It’s a costly and specialist area that is important to get right.
Specialist IT service businesses invest in certification to compliance standards such as ISO 27001, GDPR, PCI and FCA. Your organisation will benefit from adherence to these expensive standards without having to fully fund the cost of doing so (since the cost load is effectively shared across all the service providers customers).
A managed IT service provider will be technology focused, meaning its teams are highly knowledgeable and capable of managing all your IT services from desktop to data centre and the cloud, 24x7x365. This is down to the deep investment the provider will have made in ensuring its teams are trained and certified in the latest versions of software, hardware and best practices. Key certifications include those related to the ITIL global best practices around IT service delivery. These qualifications will ensure the best experience for you as their customer. You can be assured that true specialists are managing your IT so that it runs specifically for your unique workload. Within your contract, your SLAs should also agree the high availability of these specialists to support you.
Focus on value
No third party can ever understand the unique aspects of your business which drive your competitive advantage as well as your own people. But things like ensuring data is backed up, that your IT systems are secure or that applications are patched are generic functions not opportunities for differentiation. Rather than tying your team up on routine maintenance activities, it may make more sense for you to free your IT people up. Giving them the space, time and focus to bring their unique knowledge of your business to bear in high value, transformative areas – rather than just making sure the metaphorical lights are on.
Managing an organisation's IT infrastructure is demanding and can be problematic, especially during the digitally transformative ‘fourth industrial revolution’. However, experience leads to increased knowledge and know-how. Outsourcing your IT to a company that is providing similar services to many customers can only benefit you. It ensures that they have learned over time how best to deliver their IT management services. Tapping into the know-how of a managed IT service provider means keeping pace with the leading edge of technology evolution without being a guinea pig.
A single investment in outsourcing your IT is a daunting prospect. How can it meet your needs today and in the future? Will the same sizeable investment need to happen again every time your organisation changes? Rather than having to re-invest your capital, your IT partner will scale and renew your infrastructure to meet the needs of your organisation, no matter what they are. They will employ current technologies to support this, keeping your organisation modern and competitive.
Insourced IT infrastructure management ties up your capital investments in physical space, network hardware and human experts. This becomes problematic when, before too long, an update is needed. Outsourcing this function could release you from these issues and this inevitable cycle. The responsibility of making those investments, rather than being yours, will sit with the provider. Their experts will know what changes need to be made - and when - giving your organisation the flexibility to keep pace with ever more stringent regulatory requirements as well as your businesses specific needs. IT outsourcing service providers will consult with you, guiding the necessary planning for the strategic evolution and development of software and hardware. Your single investment in IT outsourcing services will deliver the flexibility to be modern, competitive and secure across all business areas.
Supplier Check Lists
- Do the security standards that the provider implements meet or exceed your regulatory and compliance obligations?
- Does the provider have a demonstrable track record of delivering and managing similar solutions and services for businesses like yours?
- Will they be there when you need them (24x7x365), ensuring your business-critical services are up and running?
- Will they provide a pro-active managed IT service which mitigates risk, outages and service degradation before users are impacted?
- Be wary of providers who say they are proactive, but mean that they respond to issues promptly. As opposed to taking proactive steps to pre-empt and reduce the number of incidents and problems before they happen.
- Will they drive innovation for you? Do they proactively introduce modern IT in a risk-averse manner that enhances rather than disrupts your business?
- Do they embrace public cloud services like Azure and AWS as part of a hybrid cloud offering? They should and if they don’t its because they are focussed on higher profit options to their benefit, not yours.
- Do the providers contracting terms flex with your business? They should not constrain your business’s ability to stretch or contract and should accommodate for acquisitions, divestitures and other corporate change.
Choosing to outsource your IT is a one-time decision that can deliver ongoing benefits to your business. If you would like to find out more contact Nasstar here.