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Motives, benefits and drawbacks of outsourcing in the IT world

Perhaps every business owner has at some point considered the option of outsourcing at least some aspects of workload, necessary for maintaining the successful business process. It is quite understandable, given the fact that the gain seems to be huge and you can save a lot of funds by outsourcing certain business functions. Using this strategy one can run a successful business without the need of hiring employees. 

Nevertheless, there is more to workload outsourcing, than meets the eye. One must consider all the potential drawbacks and weight the benefits of applying this strategy to his business, especially in the field of managed technical solutions. In this article you’ll be able to find useful tips that will give the insight on how to maintain successful and productive relationships with your service providers.

There exists an abundance of reasons as to why companies choose to use outsourcing strategy.  Here are just some of them:

1. First of all, company can save a lot of funds by opting for outsourcing. It will no longer need to hire own employees, thus saving on training, health insurance, retirement plans and all the other aspects that are associated with the process of the employee’s integration into the work process, his performance assessment, provision of the benefits that he is entitled to, etc.

2. Outsourcing at least a part of the workload, allows dedicating more time to improvement of company’s core competencies and development of new products/services, which will help to attract more clients. 

3. The outsourced job will be executed by a team ofIT professionals, who are uniquely qualified for this type of work. Thus, the problems will be dealt with much quicker and the workload will be optimized by application of the new strategies, which is only possible in case the team, you outsource the workload to, specializes in the areas that you need. Instead of hiring one employee locally, you may benefit from the collective knowledge of specialists.

4. Transferring certain projects or tasks to a different organization will allow company’s employees to dedicate more time to the jobs they were employed to do. Your internal resources will no longer be engaged in resolving the matters, which must not concern them. Situations where employees need to resolve matters, which they are not qualified to resolve, are quite common.  Even if they succeed – the company will incur a loss, because their primary work will not be accomplished due to necessity to resolve other matters.  

5. Lack of human resources, capable of managing the IT workload or shortage in the company’s budget that does not allow hiring a competent specialist can be easily resolved by outsourcing the workload  for a short or long periods of time.

6. Company can maximize the profit from restructuring by outsourcing the server and infrastructure management tasks. The main reason for company’s reorganization is the necessity to increase the quality of its services and its marketability. In the process of achieving these goals, routine server management workload is paid much less attention to. Nonetheless, it has to be managed and the best solution in this case will be transferring  this kind of responsibilities to the industry experts.

7. From time to time in every company’s servers infrastructure arises a problem or an issue, which company’s employees cannot cope with. In this case, outsourcing the job to qualified engineers is the best way to resolve the issue. Team of specialists, who are uniquely competent in the resolution of such problems, will resolve the issue quickly and efficiently. Moreover, they will maintain the highest level of performance of your servers’ infrastructure. 

8. Modern market of IT related services and products grows day by day, therefore, to maintain competitiveness, companies must keep up with the new trends and technologies, which allow considerable improvement of the servers’ infrastructure reliability and ultimately the improvement of the entire company’s workflow. Investments in new technologies can be quite risky if you are not sure which technologies will suit the needs of your company’s infrastructure best. Therefore, if you are outsourcing to a team of specialists in the field – you will not make the mistake of investing in the costly and productively wrong decision, as the well trained and experienced engineers will recommend the best solution, suitable for your needs.

Drawbacks

Whether you hire an employee yourself or transfer the job to a team of specialists, the risk will always be involved, because you will be giving the responsibility over certain aspect of your business without knowing for sure the degree of their competence. In case you decide to choose the more financially affordable solution and outsource projects of tasks to a team of specialists, you must weigh the impact that such decision may have on your business.  

Although benefits of outsourcing are quite obvious and transferring of the server management workload off-shore may seem like a great solution for your company, it is worth to take into account the drawbacks of this strategy, which are the following:

1. The servers’ infrastructure affects your entire company and certain aspects of the related workload are not easily outsourced. If you still decide that outsourcing of the IT workload is the optimal solution for you – make sure that the team you’re transferring the responsibilities to is competent in dealing with all kinds of issues, from the smallest and mundane tasks to the complex automated functions.

2. Absence of complete control over certain aspects of your business may pose a problem. You will no longer be confident that the confidentiality of your company’s data is being protected. Moreover, an overseas provider of managed technical solutions may have his own work ethic, which may be incompatible with yours and you won’t be able to change the situation as the overseas partners will not be under your management, like your local full time employees.

3. Outsourcing may decrease the morale of your full-time employees. If they see that their colleagues have lost their jobs to an off-shore service provider, they will start to wonder if they are next to lose their jobs.

4. If the IT service providers do not document their work, if you were required to sign a contract for at least a year period or if you had to purchase the proprietary software you know nothing about of the company you’re outsourcing your workload to – you may find yourself «locked in», in other words in the situation where you’re unable to make changes.  

However, it is worth to mention that all the negative aspects of the outsourcing can be easily avoided in case you know how to find a professional server management provider and if you stipulate all the controversial aspects from the beginning.

Benefits

If you’re still in doubt whether to outsource or not, here is the list of the benefits that you can expect to obtain if you actually do:

1. Transferring the server and infrastructure management responsibilities will help you to remain up-to-date with evolving technology. The modern market is overfilled with services and products and if you want your company to remain competitive you need to apply the technological innovations that are available on the market, which will boost the productivity and income of your company. One person will not be able to cope with additional task of searching for the new technologies that will fit your company’s needs, but the team of professionals, whom you’ll be outsourcing the processes to will have the necessary qualifications to choose the optimal and cost-effective product for your company’s needs. 

2. Outsourcing will help you save a lot of funds on all the aspects of the provision of the necessary hardware, software, licenses for software, etc.

3. Highly skilled team of professionals will always be at your disposal, ready to resolve the issue of any complexity in a matter of minutes. Managed technical solutions providers hire only the most experienced, highly qualified employees, capable of resolving even unusual IT-related issues. Therefore, it is much more profitable for you to outsource than to hire an employee locally, without any guarantee that he will be able to cope with any type of issue and that the work process won’t stop for a long time due to a mundane issue that can be quickly resolved by a professional.

4. Availability of multiple resources cannot be underestimated in resolving the server management related issues, IT service providers will be able to choose the upgrade or solution of the issue, which will uniquely fit your type of business. Company employees won’t be able to provide such flexibility as one person won’t be able to study the entire IT market for updates and find the most suitable ones for your business.

5. Outsourcing will help your local employees be more effective at their jobs, since they won’t have to resolve the server and infrastructure management issues, just because somebody has to do it. They won’t feel that they are asked to performed task, which they are not paid or qualified to do and as a result – you will have better relations with your local employees, who will be more productive at their jobs.

Conclusion:

Given that you’ve assessed all the benefits and drawbacks of the off-shoring, you have probably made your decision. If you made up your mind to use the outsourcing strategy, it is worth to find out some helpful tips that will facilitate your relationships with the service providers:  

  • Explain the objectives you are hoping to achieve in well-defined and concise manner.
  • Prepare a thought-through plan for your collaboration with the service provider.
  • Choose the service provider you will be outsourcing the workload to, basing on thorough research and references.
  • Meticulously stipulate all the services that you will be paying for as well as the financial aspect of the agreement.
  • Maintain open communication with all the employees, off-shore or local that are connected or affected by the agreement.
  • Obtain support and active participation in business negotiations from the individuals, involved in making the final decision.

Learn how your company can benefit from REMSYS services here.

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