IT Outsourcing Advantages and Disadvantages

Outsourcing your company’s information technology services to a managed services provider (MSP) may seem like a daunting undertaking. However, it can save you time and money in the short and long-term while allowing you to focus more on your core business tasks.

Large and small businesses alike can reap the benefits of IT outsourcing, but business owners and managers must first weigh the advantages and disadvantages of hiring externally versus building or expanding an internal IT team and plan carefully to reduce potential risks.

In this article, we’ll explore the main IT outsourcing pros and cons and go over some strategies for mitigating these potential issues.

The Benefits of Outsourcing IT Services

There are many advantages of outsourcing IT services which can save money while giving your business a competitive edge. Let’s take a closer look at them.

1. Budget for IT Costs and Scale Staff Quickly

At times, your company may have greater IT needs, such as when you’re upgrading your systems or fixing unexpected IT issues. In such cases, having an external IT management company on call can be a smart cost-saving strategy.

Building an internal IT team for all your IT needs can be expensive and time-consuming due to onboarding costs, salaries, benefits, and more. Managed services providers are used to getting up to speed quickly, however, and can scale staff in and out of projects as needed.

2. Expand Capabilities and Control Maintenance Costs

When your company outsources its IT needs, the focus is often on specific external staff working directly with your company.

However, outsourcing your IT needs may also involve adding managed services to your IT capabilities such as ongoing security monitoring, cloud storage services, or virtualization services. Maintaining these services in-house along with the required staff can be expensive.

3. Gain Extensive Experience

An often-overlooked advantage of outsourcing is the instant experience your company will gain. There aren’t many problems that an MSP’s carefully selected staff haven’t encountered before. By contrast, an internal IT team in an isolated business environment simply won’t have ongoing experience dealing with as many issues.

4. Reduce Research and Development Costs

Managing all your IT services in-house will require ongoing research and development to stay up-to-date with tech innovations and deal with atypical software and hardware issues.

When you choose to outsource these tasks, you get access to a team of professionals that can assist you with these tasks and provide recommendations on technology improvements.

5. Gain Specialized Expertise

Another one of the main advantages of outsourcing IT services is the ability to gain specialized expertise instantly versus spending multiple weeks or longer finding the right person and training them.

For example, global shortage of cybersecurity skills created a cybersecurity personnel deficiency within organizations as of last year. Outsourcing to an already establishedl Managed Services Provider with focus on cybersecurity gives you the leverage from the team of highly trained experts.

6. Focus on Core Business Functions

Managers have limited time and energy to deal with company staff. Outsourcing spreads the management responsibility to external managers, allowing your managers and IT staff to focus on your business’s core functions.

7. Externalize Security and Compliance Risks

If something goes wrong with your IT infrastructure that directly impacts your customers, such as a data breach or accidental compliance lapse it can cause significant operational and reputational costs.   Your outsourced IT provider can help mitigate the risk and expense of these types of incidents.

8. Enhance Digital Security

Outsourcing can bring ongoing services into your organization like network monitoring, software updates, or other cybersecurity needs that would otherwise entail hiring specialized cybersecurity staff, which is easier said than done.

Keeping on top of evolving security threats is also a big task for a limited internal IT team, but specialized IT service providers are focused on staying ahead of security threats.

Are there any disatvantages to IT Outsourcing?

You know about the many benefits of outsourcing IT services, there are also a few factors that may turn into a disadvantage if you do not conside them carefully. If  However, with proper approach, these elements outsourcing can be significantly reduced or eliminated.

Here are the 5 tips that help you choose the right IT service to outsource to.

1. Control

When you hire and train your own IT staff, you have control of their work hours and availability, training, the hardware they use, data access rules, etc. Relying on third-party providers necessitates giving up some of this control.

Set expectations before working with the company and make sure all of your needs are properly laid out in the contract.

2. Quality and Security

During your selection process, choose a provider with a good reputation that follows stringent security and quality standards and hires only highly qualified staff with extensive and direct experience in the areas you’ll be working with them on.

If you operate within a highly-regulated industry, you may want to consider choosing a provider that offers compliance services that can prepare your business for audits from prominent regulatory bodies.

3. Communication

It is vital to choose a reputable IT provider with clearly defined processes in place. This is generally known as a service level agreement (SLA).

The company you partner with should clearly state their turnaround time for support issues and have the capacity and commitment to respond to time-sensitive problems immediately.

4. Potential Data Security Risk

Outsourcing IT services necessitates being aware of the potential of sensitive company information falling into the wrong hands.

Choose an IT services company that takes confidentiality seriously, ensure non-disclosure agreements are signed by all individuals working with your data, and share only what you need to share.

Your chosen company should also have stringent, cutting-edge security and data access standards and shouldn’t rely on external parties to manage your data unless this is spelled out in your contract and you’re aware of the risks.

5. Team Morale and Collaboration

If you are augmenting your internal IT staff, their workflow may be impacted by outsourcing. They may view the addition as a threat to their jobs or a procees that makes their jobs more difficult. If your employees’ jobs aren’t threatened, it is critical to ensure they are aware of this.

To keep staff morale up, ensure communication and collaboration processes are formalized between your internal and external staff and address any challenges promptly.

IT Outsourcing Pros and Cons: The Verdict

There are both IT outsourcing advantages and disadvantages that must be thoroughly considered when deciding whether to build your internal team or outsource some of your IT responsibilities or services.

If you choose to outsource, plan for the above risks by choosing a partner with a good reputation. Clarify your collaboration, communication, and data confidentiality issues with them, and outline your expectations in the contract.

Whether you are considering complementing your in-house IT team or having a completely outsourced IT service, if done carefully, the benefits of IT outsourcing will almost always outweigh the cons for both large and small companies.

Bring the Benefits of Outsourcing IT Services to Your Business

Now that you understand the advantages of outsourcing IT services and the potential benefits, it’s time to find a partner who can adapt to your business environment quickly and cater to your needs.

As a leading outsourced IT services provider in New Jersey with more than 26 years of experience and a 98% customer satisfaction score, powersolution.com is here to help your business thrive through the benefits of IT outsourcing.

If your organization is ready for expertly managed IT services, contact us today to learn how we can address your IT infrastructure management needs.