How Does IT Outsourcing Work for a Business?

IT outsourcingBusinesses are constantly searching for ways to improve efficiency and save costs, which might explain why outsourcing is so appealing to savvy business leaders.

Outsourcing IT has been shown to be a particularly valuable strategy for business leaders; however, many are afraid to take make that first step and outsource their network and IT operation to an external provider, despite the clear benefits.

It’s important to understand how outsourcing works and what you can expect from the process so you can make an informed decision that will benefit your business.

What to Expect From the IT Outsourcing Process

Outsourcing IT doesn’t necessarily mean you move your entire operation overseas. It simply means that you’ve taken part of your business and handed it to a third party that now performs IT and network operations for you.

There are certain things you should expect from this process. For example, a professional third-party provider will prepare a strategic plan for you to make outsourcing work for your specific business. Unfortunately, many companies enter the outsourcing process blindly. In fact, research from Gartner indicated that fewer than 30 percent of companies have any sort of formal outsourcing governance mechanism or strategy in place, which often contributes to poor outsourcing results.

A smart outsourcing provider will examine your business’s current strengths and communicate with you through each step of the process. The external outsourcing provider will discuss with you the exact efficiencies and cost savings you can expect. The provider will also cover areas of concern like security protocols if something goes wrong.

Understanding the IT Outsourcing Lifecycle

It’s important to familiarize yourself with the outsourcing lifecycle, which will give you insight into how the outsourcing process works. In most cases, you should expect the following:

  • Strategic Assessment – To create an effective outsourcing strategy, you need to determine what your company’s strategic position is. Do you have a dedicated IT person/team?  If so, are they pulling their weight? Are you burning through capital too quickly? Does your IT person/team have the experience necessary for you to fuel growth? With this information, you’ll have a full understanding of your business and where it stands in the marketplace.
  • Need Analysis – Needs analysis helps you pinpoint exactly what you need outsourcing for, for how long and for what kind of projects. You might decide you need your entire IT department outsourced, or perhaps you only need outsourcing to build an app or redesign a company website.
  • Assessing Vendors – In this step, you analyze outsourcing vendors and determine which one suits your needs. You want to ensure you have a vendor that can deliver the services you need and do it in a secure, timely manner.
  • Writing the Contract – Once you have selected a vendor, you will negotiate a contract and work out the specific details regarding the outsourcing process. These might include an agreement about the time frame of an outsourcing project, what the outsourcing third-party is responsible for and other stipulations to ensure accountability.
  • Outsourcing Implementation – The outsourcing provider needs to work with your company — including the specific departments that are tied to the project — to ensure a smooth outsourcing transition. This stage is about building a relationship and a basis for trust. You and your outsourcing provider need to focus on communication management, process management and outsourcing governance, which are all key factors in a successful outsourcing implementation.
  • Reporting, Modification and Optimization – The outsourcing relationship should only grow in strength over time. That’s why it’s important for you to receive updates to optimize and improve operations.  For IT outsourcing, this might mean installing new, cloud-based web applications to improve productivity in a sales department or adding cloud server capacity to handle increased in web traffic. This final stage ultimately allows a series of “best practices” to form over time.

Different IT Outsourcing Models

There is usually no single formula that works best for all companies. Some companies pursue an outsourcing model in which an in-house team or individual works with an outsourcing provider. The outsourcing provider handles the day-to-day operations of keeping a network running while the on-site resource handles big picture issues and serves as a liaison between the outsourcing provider and the company.

In other situations, companies decide to outsource an entire IT operation and rely on the outsourcing provider for everything from disaster recovery to 24/7 help desk support. Regardless of the outsourcing configuration, outsourcing can fuel growth. In fact, a major Deloitte survey found that 53 percent of business respondents have outsourced elements of their IT.

The goal is to find the right outsourcing model for your company. That’s why it’s best to discuss different configurations with an outsourcing provider that has a strong track record and experience in implementing IT outsourcing for a variety of companies.

Ultimately, Dobson Technologies is a top IT outsourcing company in Oklahoma City, ensuring that every business gets the most from the outsourcing process. Contact us today at (405) 242-0171 or click to schedule a meeting to learn more about Dobson’s business IT services.