Advantages and Disadvantages of IT Outsourcing
Should you outsource your IT functions? Or maybe just a part of the IT functions can be outsourced? But then is a in-house team a better option? Every IT service provider will have you believe that outsourcing is the only way. But there is no one solution fits all answer. Whether you should outsource your IT, or do a partial IT outsourcing, or not at all depends on multiple factors – your business needs, existing IT team and infrastructure, what functions you want to outsource, organisational goals and your budget. While the decision to outsource will depend on factors exclusive to your organisation, here are some general pros and cons of IT outsourcing that can help you get started on the process. But before that, let us see some of the most common IT services that are outsourced.
IT services that are typically outsourced
Based on the expertise and productivity of your in-house team, your budget, workflow, and need to focus on core functions, you may outsource IT services such as:
- IT Help Desk
- Email security
- Network Operations Centre
- Ransomware response and recovery
- Cyber security services
- Cloud computing
- Data backup
- Disaster recovery solutions
- IT Audits and Consulting
- IT Projects
While some companies prefer to outsource their IT services to a single firm, others outsource selected projects to different service providers. While both methods have their own pros and cons, we recommend using the services of a single Managed IT Service Provider for Perth businesses. This has two main advantages – one, you need to onboard only once, and two, the service across different IT functions will be seamless since it is managed all in one place. This brings us to the next point.
Advantages of outsourcing IT services
Most businesses that outsource their IT services experience a surge in productivity and effectiveness combined with a more streamlined workflow. Here is a look into the numerous ways in which IT outsourcing can enhance overall business functions.
- Focus on what is important
When you outsource routine tasks, you are freeing up valuable time that can be redirected towards core operations. This is true for you as a business owner and your employees too. With IT management out of the way, you can concentrate on building your business, and your employees will have more time to dedicate to their main projects.
- Access to experts with the desired skillset
Although your team members may be highly qualified and skilled, it will be difficult for them to be experts in multiple domains and new technologies. This is a common issue that we see with many clients. The in-house IT team is at the top of their skills when hired. Once they become a part of the company, they attune their skills to the existing processes. Once it becomes a routine, it is quite difficult for them to think out of the box or to apply newer technologies to their work.
When a new project demands expertise in emerging technologies, outsourcing opens up ways to hire individuals with expertise and experience. Managed IT service providers will have multiple clients from different industries, which ensures that they are always up to date on the latest technologies.
- Cut down operational expenses
Keeping your in-house team updated with regular training sessions is an expensive affair. This is especially true if those new skills are not frequently required on projects. Outsourcing is a more economical option to run your business more effectively – the cost of training the staff is borne by the service provider.
- Bring down organisational complexity
IT outsourcing offers you opportunities to disband departments and maintain just the ones required to maintain core functions. You may integrate your remote team with your existing in-house team or appoint your project manager to manage the remote team. With outsourcing, workplace hierarchy becomes more flexible and fluid.
- Free access to advanced technologies
Sometimes, certain software, equipment and skills may only be very rarely required for projects. By outsourcing such projects, you can get world-class technologies and experts to work on your projects without having to purchase the software or train your in-house team.
Disadvantages of IT outsourcing
When you gain a deeper insight into what is IT sourcing, you will discover that the practice has its share of disadvantages for certain organisations or businesses. Some of these include:
- Security issues
Outsourcing IT services will undoubtedly involve sharing your database and business information with freelance experts or third-party firms. There is always the risk of sensitive information being leaked or hacked. Double-check the trustworthiness of outsourcing firms before signing them on. We always recommend hiring a reputed firm that has sufficient experience, skill and reputation in the industry.
- Not meeting quality expectations
When your in-house team works on a project, you will have a fair idea of how it will eventually turn out. However, it may not be possible to predict so when you outsource a project. If your latest project involves an advanced digital platform that your in-house team is not familiar with, it can be difficult to evaluate the project submitted by your remote team. To overcome this difficulty, make quality assurance a part of the contract, and define the expected outcomes clearly.
- Unexpected costs
If you need to revise some guidelines or project scopes after your service provider has begun work on the project, your expenses can go up. To avoid this, it is essential that you define the scope of the project or service and ensure everything is included. If it is a long-term contract, you could use a retainership model, where you pay a fixed monthly or yearly fee irrespective of the individual tasks.
- Adverse effect on company culture
Sometimes, outsourcing tasks to an external provider can make your in-house team members insecure about their job, leading to reduced motivation and productivity. In case the outsourced team gets paid more than your permanent employees, it can create discontent within the company. It is necessary to address such issues sensitively and take your in-house employees into confidence and assure them
of their job-safety.
These are some of the most common pros and cons of IT sourcing. Though this is a general guideline, these points can help you consider your options with more caution. With the right planning, background research and carefully prepared contracts, you can actually maximise your efficiency and eliminate risk factors with IT sourcing.
What can the Computing Australia Group do for you?
With over two decades of providing IT managed services to Western Australia businesses, CAG has worked with clients across industries and sectors. Check out our Services and Sectors to see our range of expertise. Here’s what we bring to the table –
- Strong emphasis on prevention and permanent solutions to problems
- Intelligent CloudSuite software to monitor your systems around the clock
- Investment in client documentation
- Ongoing commitment to staff training and mentorship
- Continuous patching to keep your systems up to date
- Quality control systems
- Dedicated escalation teams that extend the help desk experience
- Vendor relationships to manage third-party applications
- Dedicated account managers
Cloudsuite software – Is a proprietary Computing Australia solution that provides round the clock monitoring of critical infrastructure and systems.
Network Operation Centre – NOC is a centralised location or team that monitors the client’s IT systems and infrastructure round the clock.