Intelligent Outsourcing can Resolve IT Woes
By CXOtoday Staff
Mumbai, Nov 30, 2007

IT is a double-edged sword. Though no one questions its relevance in an enterprise's business model, the fact remains that if not implemented wisely, it could lead to wastage of resources and become a liability to the organization.

So what does the management do to ensure that their IT infrastructure is properly deployed and handled?

One solution is to outsource the IT projects to specialized vendors and let them handle it. This enables the company to focus more on core functions and leave the maintenance of its IT infrastructure to vendors who have the necessary expertise to manage the IT requirements of the company effectively. However there are a few things to be kept in mind while outsourcing IT projects.

Understand the project being outsourced

Outsourcing a project doesn't mean that the company's executive should remain completely ignorant about it. Executives needn't have complete expertise on the project , but they need to have a fair understanding of the project's aims and a basic vision of how to get there.

Abreastly, executives should be able to speak with the vendors in the same language. This will ensure that the 2 parties don't talk at cross-purposes and help foster a better understanding between the 2 parties.

Have a clear idea about the expectations

One of the reasons why many outsourcing deals fail to deliver as expected is that the outsourcing company is not clear about what they expect from the vendor with regards to the goals, deadlines, etc. These things should be firmly established and understood by both the outsourcing company and the vendor from the outset.

Also different companies have different work cultures. This may lead to disharmony between them, while working together, due to inability to understand each other's ethics and business philosophy. This can be avoided by choosing vendors who have a workplace philosophy similar to that of your organization. Such differences are more common in case of offshore outsourcing when both the vendor and the outsourcing company belong to completely different cultures.

Prioritize your projects

A major dilemma that CEOs face is whether they should develop an in-house solution and thus incur more capital costs or should they outsource all their IT needs to a specialized service provider and let him manage it.

One good way out of this dilemma is to outsource non-core projects, while developing an indigenous solution for the core operations. Certain organizations, especially in the banking and financial sector have used this strategy to their advantage.

These organizations outsource projects like bandwidth provision, networking, etc., while deploying an in-house solution to their core operations, enabling their IT capabilities to increase along with their infrastructure.

By outsourcing specific projects to service providers and developing an in-house solution for the rest, enterprises can insure that they don't lose touch with the latest technological offerings.

Outsourcing should be a temporary solution

Being completely reliant on outsourcing to fulfill the IT needs of the company will lead to a lax attitude toward IT. This may hamper future growth of the company. CEOs should view outsourcing as a temporary solution during the company's transition rather than a permanent component of the business plan. A robust IT infrastructure helps in maintaining sustained growth in the long run and makes the company self-reliant.

Cutting down costs shouldn't be the only objective

One of the major benefits of outsourcing is that it helps cut down on costs. However, don't fall into the trap of economizing your IT processes the main priority. While selecting vendors, make certain that the vendor will provide value for the money invested. Many companies get into long term outsourcing contracts only to find later that they actually ended up paying much more than they expected.

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