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Benefits Vs. Risks of Outsourcing IT Services

Benefits-Save Money

While companies that outsource IT services enjoy many benefits, saving money is one of the most compelling reasons for doing so. Outsourcing helps control capital outlay, especially in the early years of operations. IT services make up fixed costs for companies that do not outsource. Businesses that choose to outsource IT, whether offshore or through a local contractor, convert those fixed expenses to variable ones, freeing up capital for use in other areas. This makes the business more appealing to investors, since the company has more capital to funnel into areas of operations that directly produce revenues.

Benefit-Control Expenses

Businesses that choose to perform every aspect of operations internally must pass on the expenses associated with these activities to customers. Outsourcing IT services to a company that specializes in business networks and support alleviates some of this expense, giving the business a competitive edge in regard to pricing of goods and services.

Benefit-Focus on Core Operations

Outsourcing IT services allows business managers to concentrate on core goals and objectives. Some managers may have to split their energies between activities that engage prospective customers and concerns with operations outside of the core business objectives. Outsourcing alleviates this necessity, and the business managers can focus their energies where their competencies lie.

Benefit-IT Resources Near Those of Big Businesses

Many small businesses do not have the budget or resources necessary to implement the IT systems and services they need in-house. Large businesses have the resources to maintain cutting edge systems and services themselves. Outsourcing IT systems and services creates a more equitable playing field between small firms and large enterprises.

Risk-Dubious Accessibility

Businesses that must rely on an outside service run the risk of downtime during critical system failures, leading to potential loss of productivity. It may take days before a busy IT contractor can devote attention on the business problem and resolve the issues. This may leave workers idle and cause hundreds to thousands of dollars in lost revenue.

Risk-Loss of Personal Touch

An in-house network administrator becomes intimately familiar with the eccentricities and unique characteristics of the network he manages. Because of this, he is able to deliver results more efficiently, quickly and personally. IT outsourcing can never provide a personal touch that comes close to that of an in-house IT specialist. Many managers reject the thought of giving this up, even though they can save money by outsourcing.

Risk-Substandard Security Protocols

Businesses considering outsourcing IT services must investigate whether the managing company employs security measures as robust as their own. This is especially important when dealing with offshore companies run from a foreign country. While these often have impressive security protocols, a risk of one of the outsourcing company employees breaching security always exists. Since the foreign country may not have laws protecting intellectual property or other private data, businesses may find it difficult to prosecute such illegal activity.

Author: Samantha Gluck

Source: Chron

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