IT outsourcing: Make the move cautiously

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Writuparna Kakati | 06 Aug, 2009
Economic downturn, dwindling sales and exports, understaffing and stiff competition to stand apart are forcing many SMEs to rethink their IT infrastructure strategy and find a better solution in outsourcing. Is the choice to outsource a small business's infrastructural needs a good idea? Not easy to justify but many SMEs have started using infrastructure outsourcing as an effective tool to fill their resource gap.

Modern day SMEs have become increasingly aware of the different IT based technologies and the importance of linking their IT system and business strategy to meet their day-to-day operational needs and their long-term goals as well. It is important to do so but at the same time SMEs need to put their efforts on their core competencies rather than maintaining the IT infrastructure. Handling a organizations' IT needs takes a lot of time, talent, and financial resources - it is why IT infrastructure outsourcing can be very effective for SMEs to free up time and fill their resource gap.

How infrastructure outsourcing can help a business reduce cost and increase efficiency? The idea behind infrastructure outsourcing is 'Do what you do best leaving the rest to be done by someone.' So, if your business deals in manufacturing industrial equipment, there is no point to maintain a team of tele-callers to answer customer queries. It is better to outsource this service to someone else who specializes in it. A firm dealing in textile products does not need to hire software professionals to handle its web portals or online sales operations. Just outsourcing these requirements will minimize a lot of costs.

However, it is hardly possible for a business to outsource all its IT requirements. It requires careful analysis to identify areas that can be outsourced. In fact, many businesses fail to benefit much from IT outsourcing primarily because of their inability to choose effectively what to outsource and what to not. They look for immediate cost savings without giving more thought to long-term needs, service quality, flexibility and infrastructure service levels. As a result, more resources are consumed than expected.

Many firms underestimate the depth of skills required for managing an outsourced contract. For managing outsourcing effectively and benefit from it, a firm must be able to maintain clear and continuous communication with the contractor. The internal IT staff must be able to coordinate properly with the external providers to make things work better. In addition, regular service review and attention to detail are some essential prerequisites to obtain proper service from the supplier. Planning is the key to benefit from outsourcing. If a mess is outsourced, it results in a more expensive mess.