Due Diligence – How to Successfully Outsource Your IT Needs

Due Diligence

How to Successfully Outsource Your IT Needs

By Wes Britten

When it comes to a specific business need like IT, small and medium sized businesses may feel hesitant to stretch their budgets. An experienced network administrator can easily demand a salary over $120k. Many small business environments cannot cover that salary. In these cases, it is common for the small business owner to outsource their IT needs to reduce costs.

But how do you know if the company you hire is qualified for the job you need them to do? And how do you know if you are getting value for your money? Maintaining due diligence on the people you assign access to your systems and data is more important than ever.

The first step in deciding if and how to outsource your IT needs is, like most other business decisions, weighing the risks versus the benefits. The following benefits and risks might help you decide on what to look at.

Benefit #1: Saving Money

This is the most compelling reason to outsource IT services. Outsourcing helps to control capital outlay. Businesses that choose not to outsource will have a fixed IT expense every month, while those that choose to outsource convert that fixed expense into a variable one. This allows you to save capital for other areas, which is especially important in a business’s first months and years.

Benefit #2: Controlling Expenses

Businesses that choose to perform IT operations themselves must make up for that expense by charging their clients and customers more for services. Meanwhile, outsourcing IT to a company that specializes in business networking and support services alleviates some of this expense, allowing the business to knock down prices and gain a competitive advantage.

Benefit #3: Focus on Core Operations

Outsourcing IT services allows business managers to concentrate on core goals and objectives. While some managers have to split their time between growing their business and managing operations, outsourcing IT can help. Managers who have more time to spend on core business objectives will always be more successful.

Benefit #4: Level the Playing Field

Large businesses have the resources to maintain cutting edge systems themselves. But many small businesses cannot afford the resources necessary to implement IT systems and services like larger businesses.  Outsourcing creates a more equitable playing field between small firms and large enterprises.

Risk #1: Potential Downtime

When you rely on outside services, you run the risk of downtime during critical systems failures, leading to loss of productivity. Without a favourable service level agreement (SLA), it may take several days for an IT contractor to devote the attention needed to restore your system. This can leave staff idle and cost revenue.

Risk #2: Losing the Personal Touch

A full-time IT and network administrator will get to know your system intimately. They will be able to recognize when something is amiss. This can help to identify a problem before it becomes a catastrophe, saving your business a costly headache. Outsourcing cannot provide the personal touch that comes with an in-house expert.

Risk #3: Standards and Security Policies

Anyone considering outsourcing their IT needs must undertake a risk assessment that includes a thorough investigation of the potential provider’s security protocols. Opening up your data and networks to a company whose employees have not been properly vetted is a disaster waiting to happen. Your due diligence must include thorough scrutiny of how the service provider manages their employees. Always keep a list of exactly who will have access to your systems.

Risk #4: Administrator Privileges

Many IT services and network protocols require elevated privileges to complete. The decision to give any one administrator the rights to your system needs careful consideration. You also need to ensure you have at least one person on staff (probably a senior manager) who also keeps administrator access in order to revoke someone else’s privileges if necessary. Even if that is all they know how to do, it is important that you retain that minimum amount of control.

Whether you decide to outsource your IT services or not, it is important to note that you and your staff are still responsible for maintaining due diligence when using the internet and accessing sensitive data. Outsourcing does not mean you can sleep on security because someone else is managing the system. A robust cyber awareness training program and policies are still essential in protecting your systems and data. Also, remember that if you do choose to outsource, you still call the shots. If you have concerns about a provider’s services, access levels, security policies, staff, or anything else, don’t hesitate to question them. At the end of the day, it’s your business on the line.

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