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Thoughts on outsourcing IT services?
My company is on the smaller side (40-50 employees with 2 locations), and we’re finding that we need more IT support. In terms of initial cost & overall ROI, is it better to build an IT group from within, or outsource IT services to a reputable vendor?
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5 Answers
Adam, you are in a great position to take your IT department by the horns and move it in the right direction.
I highly recommend you review the following articles to gain insight into your options.
IT In Crisis – Three Priorities for IT in 2010. Part 1
http://www.itanswers4u.com/Wordpress/?p=215
IT Strategies: Past, Present and Future
http://www.itanswers4u.com/Wordpress/?p=84
Bottom line is this. Your business objectives should drive your decision. Don't do something just because others are doing it.
I've been involved in outsourcing deals that have turned out great while others have gone very bad. There are many factors to consider in this decision including these few.
Company cultures (yours and the outsourcer), are they compatible?
Scope of responsibilites: are they clearly defined between your staff and the outsourcer?
Are your Service requirements clearly defined and can they be effectively communicated?
I don't mean to scare you away from outsourcing. Done right it can be a great opportunity for your business. It can cut cost, transfer risk, gaurantee system performance levels, etc.
Whatever you do, please don't do anything until you've reviewed the articles mentioned above and determined your business obejectives first.
If you'd like to discuss your options or my comments please feel free to contact me.
Always a great thing...http://www.eyevirtual.com/biz_req_sb.html
Strongly recommend it. Your in the business of increasing your Top and Bottom Lines. Your IT should provide you with a "Peace of Security..and Peace of Mind."
If we can be of service, hit us an email.
rich@eyevirtual.com
www.eyevirtual.com
+1 to John's suggestion about it being a business factor decision. Are your sites close together? Could you support one (or two) full-time IT staff, or even a part-timer? How much IT infrastructure do you have to support? What response time do you need if something goes wrong? They're all factors.
Dear Adam,
I would say, it depends on the criticality, volume and your current/immediate needs....
With so many vendors claiming their competence in IT Services, it is often overwhelming to pick the right offshore partner. The fact is that most of them have no foot-prints in IT Outsourcing. It is suggested that it helps to follow a structured process, as described below, to arrive at the right partner.
Learn - Identify - Seek Information- Evaluate - Check References - Select Vendor - Try pilot - Scale-up
Learn: When considering a successful outsourcing initiative, it is very essential to initially understand the concept of outsourcing and industry trends. Also, set your strategic and tactical objectives upfront.
Identify: Identify offshore companies based on clientele, references, known-contacts, market-research firms, search engines etc and prepare a short-list of them – not exceeding 6 to 10.
Seek Information: Obtain detailed information on company, infrastructure, scalability, clientele, relevant experience, references, technical competence, global presence, multi-language capability, disaster recovery, IP protection practices, quality and process standards etc.
Evaluate: Critically evaluate telecom infrastructure, technical competence of the resources, HR policies, cultural fit, process compliance such as ISO/ISMS etc.
Check references: Speak with management of offshoring companies, their employees, and obtain as much information as possible from their other clients – preferably visit their clients.
Select Vendor: This is the most important activity of outsourcing initiative. It is important to select the right partner from heap of several who claim they are good vendors. Make sure, you get the executive commitment from the offshore partner company - that goes long way in your success.
Try Pilot: It is always advisable to try small and then expand quickly. Pilot should help you assess your partner’s competence in terms of telecom suitability, management commitment, technical competence, process adherence and SLA compliance.
Scale-up: This is the time for you to scale and reap the benefits of outsourcing to the fullest extent. Prepare the transition plan based on modules of the product, or geography of the customer base or simply number of resources.
Request you to go through my profile and get in touch with me.
Email: Pavanm at Innominds.com
Thanks in advance
Pavan M
Director-BD
My experience at that size is it is better to build a group within with good vendor relations for backup on the bigger issues.
For example, you are less likely to get immediate attention required when sale's workstation breaks at 11am and their sales telecall is at 2pm. Big company warranties will be for next day support. You can get better response times if you are willing to pay for it.
If you have inhouse expertise you have someone there to load, tweak, configure and understand what requirements the business has. If you choose right, you'll get someone with initiative who will grow the IT response to create things that will help the company, above and beyond the basic brief. External vendors won't do that for you other than in a 'would you like fries with that' service add-on way.
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