IT: Is it worth moving it out of house?

Post-COVID-19, companies may seek outsourcing as a means of maintaining profitability.

Accounting, marketing, customer service, and human resources are all examples of services that may be outsourced. A typical reason for this is that IT provides a less expensive method for technically challenging tasks that the company owner lacks the skills to properly complete.

Outsourcing your IT might be a good or bad move for your company, and we’ll help you make that decision.

What is IT outsourcing?

Let us first define what outsourcing means.

You delegate some of your business’s functions to a third-party service provider using outsourcing. This might be one of the following:

a long way from the coast (outsourcing to a foreign country with favourable tax savings and lower costs)
Waterfront (outsourcing to a bordering country for easier communication)
In-country (inside the country of origin)
The term “cloud computing” refers to the user (the third party would provide IT-related services over the net such as software as a service or platform as a service)
Managed service (such as call centres, virtual private networks and firewalls)

As a result of relocating your IT services to a remote location, your firm would be able to expand its operations without incurring high costs or risks. For added convenience, you may not even have to maintain your storage equipment and facilities.

Pros of IT outsourcing

There are certain perks to outsourcing your IT.

Slash your labour costs and IT costs

Outsourcing gives you access to IT know-how without the associated overhead costs of hiring employees in-house. Some experts specialise in providing services relevant to your business (more on that below).

Fewer security threats and quicker recovery from adverse happenings

Disaster recovery is a skill that IT companies can help you learn so that you don’t lose all of your company’s work in the event of an emergency. In terms of consumer data security, IT companies are well-versed in important regulations like GDPR, which might save you from a few scrapes. Their knowledge and ability to deliver constant training based on rule changes will certainly outweigh your employees.

More energy to focus on the business

The less time you spend thinking about your IT, the more time you have to concentrate on other aspects of your company, such as raising capital.

Could save you from high turnover in the IT department

Staff turnover and recruiting expenses may increase if you have an in-house IT department. An IT service provider will take care of this for you, ensuring a smooth IT experience.

Up your company productivity

An outsourced IT team made up of multiple personnel may assist your staff instead of having one or two people deal with the IT difficulties of a developing organisation. They’ll be able to monitor their computers remotely, providing them with a better understanding of what’s going on.

It is also possible to build up new solutions that will speed up daily activities provided by IT companies.

Cons of IT outsourcing

Of course, there will be downsides too.

Their turnaround times will be longer than someone who works in-house

There are times when it’s not convenient to ask the IT staff for check-ins or off the cuff requests since they’re not in the office. Due to their emphasis on other clients, projects may take longer to finish.

Less control over the outcome or final product

Your IT service provider may be unfamiliar with the way your firm operates and may perform duties inconsistently. Again, you’d have to offer ideas based on the firm’s capabilities rather than making rapid changes to projects.

Can be difficult to get hold of them and communicate

When the main method of communication is by phone or email, it might be more difficult to get in touch with the organisation especially if you want to make a last-minute change to a project with an impending deadline.

Different standards if you’re outsourcing to a company based in another country

If you’re thought about outsourcing any of your work, make sure you read this. This might conflict with your values and corporate social responsibility declaration if you’re outsourcing to a nation with different labour, ethical or legal standards than your own.

Lower staff morale

There is a risk that your employees may become more concerned about their job security if they see that specific areas have been outsourced.

Who should I go to for my business IT?

It’s more difficult to provide comprehensive critiques of IT outsourcing businesses. Each one is unique and based on your company’s requirements. You can usually find out what sectors a company works in and what services they may provide by looking at their website.

We’ve compiled some key statistics on a few different IT service companies to give you a sense of what’s out there.

ScoriaTech

Base: UK

Key industries: Retail; charities; events and publishing; property developers; talent agencies.

Tata

Base: Worldwide (UK locations in England, Scotland and Wales)

Banks and financial services; communications, media, and technology; Hi-tech, life sciences, healthcare, public services; consumer goods and distribution; energy; resources; utilities, insurance; manufacturing; retail.

Cognizant

Base: UK (in England and Scotland)

Financial services; banking and capital markets; communications, media and technology; healthcare; insurance; life sciences; manufacturing; retail, transportation, and logistics; travel and hospitality; utilities are the most important businesses in the United States.

Capgemini

Base: Worldwide (UK locations in England and Scotland)

Aerospace and defence, consumer goods, distribution, media and entertainment, the public sector, travel and transportation, the automobile industry, banking and capital markets, energy and utilities, manufacturing and industrial products, and telecommunications are the most important sectors.

Accenture

Base: Worldwide (UK locations in England and Scotland)

the financial services sector; the chemical industry; information technology; the retail sector; the consumer goods industry; the energy sector; the health sector; hi-tech, industrial equipment, insurance, life sciences, natural resources, public service, retail, software and platforms, travel, and utilities are some of the most important industries in the United States.

Should I outsource my IT?

Ultimately, it’s up to you and your company’s objectives and goals. If you’re planning to expand your firm and relocate your IT, it’s a good idea. Do some introspective work to determine whether or not outsourcing might improve your team’s efficiency. Keep in mind that you have the option of outsourcing certain of your operations while maintaining control over the most critical components.

Examine the offerings of some of the industry’s third-party IT vendors. Even if you don’t think outsourcing is ideal for your company right now, you can always come back to it later when you have a clearer picture of what’s ahead.