6 Mistakes to Avoid When Outsourcing Your IT
IT outsourcing is no longer the fringe concept that it was when it first burst onto the tech scene. Today, numerous organizations have outsourced some aspects of their technology needs. Outsourcing helps your business reduce costs, grow faster and avoid the mistakes that could precipitate its demise.
Nevertheless, the benefits of outsourced IT services for your company are never guaranteed. There are mistakes that can make it harder for you to realize the advantages. Knowing these mistakes and taking measures to avoid them can increase the odds of your IT outsourcing delivering as it should.
Poor Contractor Evaluation Process
You could either advertise your business’s need for outsourced IT services (this usually applies to large corporations) or develop a shortlist of service providers that you then assess for suitability. Irrespective of the approach you use, it’s important to have a robust contractor evaluation process that includes a detailed checklist.
Study each contractor’s portfolio, certifications, clients they currently work with, and the experience they have serving businesses in your industry. Interview their representatives to get a first-hand feel of their customer service, competence, and commitment.
Getting Rid of Your IT Managers
When you outsource your IT, you don’t outsource your responsibilities to make sure the technology systems work. Whereas contracts and SLAs can go a long way in ensuring the outsourcing contractor does what you expect of them, ultimately the contractor looks out for their own interests first.
Don’t expect the contractor to pursue your business objectives for you. You still need IT managers that will serve as an interface between your business and the contractor. The managers will ensure that the outsourcing service provider does not drop the ball. They help the contractor get back on track whenever they lose sight of what they should do.
Not Paying Attention to the Service Provider’s Location
The internet has made it possible for businesses to hire contractors or access IT services offered by a provider located thousands of miles away. However, the power of the internet can be overstated. There are plenty of technical and non-technical factors you should look at that are specific to different regions of the world.
Whereas the cost of the outsourcing service may be low, think about language compatibility, culture, skills, and capacity of telecommunication infrastructure. Just like real estate, the location of the service provider can make the difference between the success and failure of outsourcing.
Trying to Outsource Everything IT
Some companies get too caught up in an outsourcing euphoria and assume the more they outsource, the greater the benefits to their business. Ideally, you should only outsource IT services and tasks that are outside your IT team’s core competency, can be documented in detail and have specific measurable deliverables.
There are technology processes that may be better off handled internally. For example, help desk functions in medium and large organizations are probably best left to the IT department.
Idolizing Lowest Cost Offer
Cost is certainly one of the most important reasons you’d want someone else handling your technology functions. Nevertheless, an excessive focus on cutting cost can be counterproductive. Remember, you need the employees of the outsourced IT services provider feeling happy if you want them to consistently provide quality service.
Disgruntled workers are unmotivated, inconsistent and will do a poor job. Make sure the staff at the outsourced services provider are fairly compensated. Usually, the right pay is less than what you’d pay for a direct employee but more than the market rate at the service provider’s location.
Expecting a Drastic Fall in Your IT Budget
When you outsource your IT services, the natural expectation is that your technology costs will fall. The mistake many businesses make is to assume a sharp drop. They get surprised when they find it isn’t that steep (they may, in fact, see an increase at the beginning). That’s because whereas you will eliminate some expenses by outsourcing your IT, this will be accompanied by an increase in technology spent on other fronts.
For example, to make sure your IT department and the outsourced service provider work in harmony, you’ll have to heavily rely on collaborative software, high-speed internet, and sophisticated data security tools. You’ll also have to spend money training your IT department and the rest of your staff so they understand their role in the new setup.
Businesses shouldn’t approach IT outsourcing as an easy, inexpensive technique for offloading their technology needs to a third party. Instead, they should carry out intensive groundwork by evaluating their needs and goals so they can settle on an outsourcing plan that delivers the expected benefits of lean, competitive and efficient IT operations.
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