Outsourcing is a global trend. It stipulates handing some projects or processes to professionals beyond the company’s staff. Today, the global companies’ expenses on these services exceed trillion dollars. IT projects outsourcing is the most popular segment in this market.
Why Companies Outsource?
There are many reasons to choose this management path. The main idea is to get professional help without maintaining an in-house department.
• free staff (in our case, IT staff) from routine and non-key tasks.
• to concentrate the forces of employees on their main business functions
• reduce the financial burden or save money on hiring professionals.
How to Prepare for IT Outsourcing?
The decision to transfer the responsibility for the tech services to subcontractors is not an easy one. The business owner and managers have to make sure that the delegated processes are safe with the new operators.
The problem of trust in such cases may be solved by working with big-name reputable firms or through outstaffing. There are well-established IT outsourcing companies like Develux or other big service providers. Managers at Develux keep in touch with their clients and ensure smooth operation and timely tech support.
Before handing the core IT tasks over, assess your company’s readiness for outsourcing:
• Define the key IT service management processes.
• Plan several specific and achievable transformation goals.
• Try to define whether the business owners are satisfied with the IT management in the company. This analysis will help avoid future issues and make the contractors work as productive as possible.
• Then calculate the cost-effectiveness. Experience shows that in theory, managers know that IT outsourcing allows saving money. Yet, in practice, not everyone can correctly calculate the cost of ordering IT services.
The expenses on maintaining an IT infrastructure come in three main groups:
• Direct expenses on the salaries of IT specialists.
• Direct and indirect spendings on the work process organization. These include the cost of works, workspace arrangement, costs of training, and staff development.
• Other estimated expenditures like risk management, organization, communications, infrastructure, etc.
How Does This Process Impact Employees?
Let’s put saving money aside. The primary resource of each company is its employees. When the decision on IT outsourcing is made, the work of the IT department changes for good.
The company’s in-house IT specialists go through extra training. Doing so allows them to work as managers. Since then, their main task will be managing the work of the service provider.
The transformation into a manager does not always suit all tech specialists. To keep valuable personnel, the company may transfer such employees to an outsourcing company. This switcheroo will reduce personnel risks since the experienced technicians will be improving their qualifications. At the same time, they will continue to be involved in the company’s project.
What Can Be Outsourced to IT Subcontractors?
It is impossible to outsource the entire IT system. Let’s find out what is worth it and what should remain within the company.
There are three extra jobs that you can pass on to subcontractors:
1. Service Desk
This service is the standard and most outsourced one. Due to this system, managers can still receive and route calls without interruptions in the event of system failures. This service also helps prevent and solve technical problems faster as well as restore the work pace. Outsourcing companies get more satisfied users, zero technical issues, and a 2-fold reduction in the cost of servicing end-user requests.
2. IT infrastructure management
Productivity directly depends on the successful operation of the IT infrastructure. Outsourcing this work to professionals will increase productivity, make the expenses more transparent. Using IT outsourcing services also allows saving on indirect expenses such as license purchases, maintenance, rental, and utility bills.
3. Application management and workplace support
Efficient delegation of some processes reduces the cost of business ownership. At the same time, it helps to increase the app’s usability and efficacy. Moreover, by outsourcing application deployment automation to a contractor, a business manager can reduce the cost of expensive custom software.
Yet, the most significant things should remain under the care of the internal IT department.
1. Design and architecture development
The entire life cycle of the company, its past, and plans for the future is known only to its employees. The company and its internal departments respond faster and more efficiently to changes within the business environment. So, the design and development of architecture must take place in-house. An IT outsourcer can help with this, but he shouldn’t own the process.
2. Critical services
This is the part of the IT system responsible for the key business processes within the company. An option to quickly adapt to the current market situation, as well as development trends and business comes from within the company. If outsourced, such changes may take more than a week to come to life.
1. Size matters
Small companies outsource many tasks from recruitment and engineering to taxes calculation. Such a management scheme is way more cost-effective. Just imagine paying monthly salaries to a bunch of recruiters if your company is packed with qualified professionals and has no need to hire more of them.
The internal IT department cannot provide all necessary services singlehandedly. Anyway, it takes more than a couple of system administrators and a development team to meet the growing needs of big corporations. That is why the key market players are very actively promoting the concept of outsourcing in the provision of IT services.
2. Shift of Roles
Turning to IT projects outsourcing, the responsibilities of the IT director are gradually changing. Often they get narrowed down to the selection of a contractor and control over his work. The IT director does not dive into the details of automation but monitors the contractor’s work by results and the degree of satisfaction of frequent users.
3. Pick the Model
Currently, there are two main models of outsourcing IT processes:
- Evolutionary model
In the evolutionary model, processes and services are passed on sequentially to third-party contractors. The transition here goes slow, which allows making small changes and experiments. The employees remain on-staff in the company and gradually transfer their functions to external contractors. Later, their work focuses on the tasks of selecting suppliers and monitoring results. Thus, they turn to observers.
- Revolutionary model
In the revolutionary model, the IT department, along with its processes, turns into a legal entity. Usually, it becomes a subsidiary and provides services to both external customers and the enterprise itself.
4. Consider Outstaffing before Diving Deep
One of the types of outsourcing is attracting specialists from a third-party IT company on board the internal IT department. This service is called outstaffing. It is a simple form of outsourcing since the customer himself is in charge of new specialists.
Outstaffing works best for companies starting to work with subcontractors. They would rather start working with external specialists under their leadership at least to get a professional audit.
So, the main motive for outsourcing is to get IT services of the required quality, paying less than in the case of using in-house resources. We may call the process outsourcing if the contractor performs regular activities aimed at obtaining the results the customer needs. In other cases, it would be consultations, external audits, guest specialists, involvement, etc.