Things to Consider when Outsourcing IT

Posted on May 24, 2012 by Nikhil P Naik

In today’s fast high tech world, a reliable and agile IT system is a must for any business, regardless of size.  Information is power; but if your information is difficult to access or hard to convey, store, or manage, you can find yourself quickly falling behind the competition.

Investing in IT can provide great returns if done wisely.  More and more businesses are recognizing the value in outsourcing their IT capabilities in order to maximize their investment.  When considering whether outsourcing makes sense for your business, here are some important points to consider:

Domain Expertise

It systems are highly complex and rapidly evolving.  Hiring the personnel necessary to have enough expertise to cover all of your needs can be a huge hit to your overhead expenses, especially for smaller businesses.  Continually training those people to keep up with today’s technologies means additional cost.  When you outsource you can minimize your overhead costs while still obtaining the subject matter experts that you need.  You don’t need to be a large multi-national corporation to have a world-class enterprise level IT system.

Flexible Growth

If your business is highly static, an in-house IT system might be right for you.  However, businesses that experience fluctuation in demand or that expect to have even moderate growth may find that an in-house IT systems drags their growth and hampers their ability to adapt to the needs of their clients.  Investing in IT personnel and hardware requires careful planning and can potentially result in under-utilized assets.  Outsourcing gives you the flexibility to pay for only those resources that you need, only when you need them – and have those resources be available instantly.

Risk Mitigation

Job turnover can be high in the current economy.  When you invest in personnel, you risk losing those valuable resources – you risk your time and money.  For smaller businesses or wherever knowledge transfer may be difficult, that risk can be substantial.  By handing your IT operations over to an external firm, you eliminate this risk and better position your business for success.

Experience and Reputation

Because IT forms the foundation upon which many companies thrive, handing over control of that responsibility can seem daunting.  Just as when hiring employees, due diligence and caution should be exercised should you decided to externalize your IT infrastructure.  Many firms may promise the sky but fall flat when trying to deliver.  Make sure to do your homework and check resources to keep your business on the path to success.

Dan Coppen is an independent writer who promarily focuses on the different ways businesses use technology. You can read more of Dan’s business computer tips at

About Nikhil P Naik

Nikhil Naik has a Master's Degree in Information Systems, and is currently working as a Software Engineer at Microsoft. He also loves playing cricket, listening to music, and traveling. Twitter Handle - @buzz_nikhil.

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