Companies may not talk about outsourcing so much now that it’s such a well-worn topic. But that doesn’t mean they’re not interested. According to a study by industry association CompTIA, corporations are scoring big benefits from using managed services.
Nearly half have used them to trim their annual IT budgets by 25 percent or more. About 13 percent slashed half of their spending. And 50 percent of companies surveyed saw savings between 1 and 24 percent. It helps explain why the Society of Information Management (SIM) found that 65 percent of corporations now outsource at least some of their business processes, whether application or infrastructure management. That’s little comfort to people with information systems degrees who want to protect their livelihood.
But maybe what’s needed is a slight change in attitude and career strategy. First of all, more than half the respondents to the CompTIA survey said that they wanted to free IT staff for revenue-generating projects. As importantly, just as no product manages itself, companies must consider outsourcing another type of task. The IT department now needs to keep outsourcing running well and saving money. That means someone in IT must know the potential pitfalls of managing outsourced projects and how to avoid them.
Security and Compliance The more parties that handle information, the more chances there are of a security breach. Understand the true nature of the threat. That includes the type of data; any regulatory compliance issues that accompany it, such as the laws that come into play with personal, financial or healthcare information; different regulatory requirements in the country of the outsourcing firm; limitations on protection of intellectual property; and employee background checks and security provisions of that firm.
Communications A company’s daily business will depend on the outsourcing firm, which may be many time zones away. Strong communications is critical to success. There should be a single point of contact at the firm who has enough authority to get things corrected that go wrong. But good communications also means properly monitoring what the outsourcer does down to level of details you might not ordinarily expect to watch. For example, keep an eye on staffing and turnover on your account and have the contract specify language skills, educational background, experience levels, technology certifications, and other factors that could affect how well work is done for your company.
Metrics Outsourcing in a way was a precursor to cloud computing. What a company deals with is largely a black box over which it has little direct control. The management imperative becomes metrics that can measure the provider’s performance as seen by the company client and internal processes for thorough project management. Become an expert in one or more of these areas and you become one of the people a company has to keep through any rounds of staff reductions.