Risks and Rewards of Outsourcing IT to an IT Consultant

Risk v. RewardThere are many benefits to hiring an IT consultant rather than paying for an in-house IT department. First, most companies see significant savings by hiring out their IT managed services. Second, outsourcing IT allows businesses to focus on their core offerings while receiving expert advice from IT professionals.

These are only a few of the advantages that come with outsourcing IT services. However, as with any business transaction, there are also a few risks posed by outsourcing IT. We cover three of these risks below and provide basic advice on how to avoid each.

Risks of Outsourcing IT, and How to Avoid Them

1. Some IT consultant services are more focused on selling products than on helping your business.

Certain IT outsourcing outfits claim that they offer IT managed services, but their actual goal is to sell you unnecessary software or hardware products.

To avoid this risk, be wary of proposals for “free consultations,” which are usually just opportunities for these sales-y types to proffer their goods. In general, a sincere IT consultant will suggest commonsense solutions; even a layperson should be able to understand how these answers could benefit an organization. If, during your preliminary vetting of IT services, you notice that a certain IT consultant seems to be pushing a certain product, chances are that individual will not serve your business well.

2. Mishandled system failures could cause costly downtime.

Given the complexity of our modern information networks, it’s no surprise that snafus arise. Successful IT professionals must be adept at quickly responding to and resolving system failures. Just as a person’s true character is often uncovered in the midst of a crisis, the true worth of an IT consultant is revealed during network downtime. If you partner with a less-capable provider of IT managed services, you could face extended downtime and profit loss, since your employees can’t work without computer access.

To avoid this risk, ask each potential IT consultant about his or her downtime philosophy. How do they respond to problems? Will they be on the scene ASAP? What financial or legal recourse will be available to you if your IT system fails? It’s also wise to ask for customer testimonials, which can help you understand how well each IT consulting firm responds to downtime challenges.

Because dealing with downtime is so challenging for the vendor-client relationship, many companies create Service Level Agreements (SLAs) to dictate how outages and service failures will be handled. An SLA outlines agreements about the responsibilities, services, priorities and guarantees for both parties. Sometimes an SLA will also include information on financial remedies in case agreed-upon services are not provided. If you are especially worried about faulty service, arrange a Service Level Agreement prior to the start of service.

3. Customers could experience poor service.

The global reach of modern networking technology allows many IT services to operate overseas, where labor costs are significantly lower. For those who begin outsourcing IT for cost purposes, overseas outsourcing (sometimes called “offshoring”) can offer a real financial advantage.

However, the flip side is that customers may not be able to understand overseas workers. Most of us have experienced the irritation that comes with being unable to comprehend a company’s representative. The ultimate threat to your business is that customers may decide to switch brands after an unsavory interaction with overseas outsource personnel.

Poor service can also be a real possibility when American workers are providing outsourced IT managed services. For instance, customers could become frustrated if outsource workers lack detailed knowledge about your products, website and services. Ideally, your customers will not be able to tell that you’re outsourcing at all. If the gap between you and the outsourcing partner becomes painfully obvious, and customers are unable to easily get help from an IT help desk, for instance, you could lose business.

To avoid this risk, survey your customers before partnering with a provider of outsourced IT managed services. Figure out which aspects of the customer experience must be handled by in-house experts and which parts can be mastered by outsourcing agents. Once your new outsourcing situation is set up, continue talking to customers about what’s working and what’s not working.

You can enjoy the advantages of outsourcing IT without suffering profit loss by following the tips listed above.

[ Photo by: Daquella manera, on Flickr, via CC License ]

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