IT outsourcing is all the rage. Even smaller companies are increasingly outsourcing their IT to a partner. This is causing the role and tasks of IT managers to change while, at the same time, the demands on the service provider rise.
Is outsourcing always the right answer? No, but it is an attractive alternative with a future. Our experience shows that the size of IT departments is decreasing but the benefits of IT are increasing. Will this trend continue until there are no more company-internal IT departments?
Some customers have already taken this approach. Lerch AG, for example, has dissolved its IT department and now has a single partner – Swisscom – to operate its ICT. Lerch has employed a manager, who continuously analyses and optimises the business processes and manages IT via Swisscom.
IT from the socket
Outsourcing is being driven by rapid technical developments, such as cloud computing and virtualisation. IT services are coming to be seen purely as a utility, like electricity and water. The American Nicolas G. Starr also predicted a clear paradigm shift in his book The End of Corporate Computing. The vision of “IT from the socket” has already become reality in some areas.
Not only large companies, but also smaller ones, choose outsourcing. They have reached a critical size and recognise the need for professionally managed IT. Good IT personnel is rare, the costs for this high. Instead of setting up a department themselves, they seek alternatives. For many companies, this is reflected in the form of a hardly manageable number of suppliers and a heterogeneous IT landscape.
New tasks for customers and providers
When companies outsource IT, the tasks for the customer and the service provider are suddenly redistributed. For the customer, supplier, quality and performance reporting gains a whole new meaning. It is important to make the value of ICT for the company and its processes clear. This used to be incidental, after all, the company had to deal with IT operation full time.
For the service provider, transparent cooperation with the customer comes to the fore alongside smoothly functioning IT. After all, in the complex world of ICT, there are always unforeseen incidents. It is important to evaluate and solve these together with the customer. Many providers lack the means, the tools or the mentality to be successful in this area in the long term.
From operator to innovator
Of course, it makes no sense to dissolve your existing IT department immediately. Alternatives are needed, as well as a transformation route. A comprehensive assessment of the current situation is the first step for every strategic change – ICT infrastructure, costs, requirements and action areas need to be analysed. Taking a purely technical view usually leads to false conclusions. Involving the users – for example, through a survey – frequently leads to valuable insights.
Finally, it is important to get a clear idea of the role of ICT within the company – does it only need to work reliably and at a reasonable price or should it continue to support business models, processes and users optimally in the future? Suddenly the challenge is: From operator to innovator!
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Are you already operating without your own IT? Where do you see your IT in 5 years’ time? I look forward to reading about your experiences and to your questions and comments.