Reasons to Consider Outsourcing Your IT Services
13 Jun 2022
Many businesses rely on outsourced IT services, and it's easy to see why. The benefits are access to best-in-class computing capabilities and expert knowledge when required, as well as scalability to match business demand.
The Deloitte Global Outsourcing Survey last year found that the top reasons cited by respondents for outsourcing IT were, in order: slashing project expenses, boosting flexibility, accelerating time to market, accessing tools, and improving agility.
However, some firms are falling behind in the technological race to leaner operations and bigger profit margins. If your company is on the fence about outsourcing its IT functions, read these benefits to help you decide the best approach.
1: Cost-effective
Outsourcing means you don't have to buy hardware or software or keep the business on track with the latest software updates. This saves money because the software is updated by the IT service provider.
The average cost per user of outsourced managed IT services is often cheaper than providing such services in-house, especially as businesses get larger. Outsourcing helps business manage their own requirements with a single team dedicated to their needs. They can concentrate on running their business rather than managing the complexities of maintaining their own IT functions.
Through the use of cloud solutions, companies can lower their expenditure, and avoid the complications of being locked into complex purchase contracts that could become uneconomical in the long term.
The average cost per user of outsourced managed IT services is often cheaper than providing such services in-house.
2: Lower human resources burden
If your firm is hiring a lot of in-house IT staff, outsourcing this function can help save money. This is because the number of employees required to run an IT department is often higher than the number of IT experts required. Therefore, outsourcing helps to create savings. Furthermore, an established IT service provider will be able to pass on the economies of scale it enjoys because it provides IT services to a range of clients. This issue is becoming more salient as there is a shortage of IT experts.
In short, getting the optimal setup in-house is expensive and time-consuming and becoming more and more difficult. Besides, internal resources are more challenging to scale up and down according to changes in demand.
3: Better risk management
This is perhaps one of the least-mentioned benefits of outsourcing, but it is important nonetheless. Outsourced services from a high-quality managed service provider are bound by a legal contract that will include a non-disclosure agreement and precise scope of work, plus payment terms etc.
But that shouldn’t give the impression that working with an MSP is a set-and-forget approach; it’s more about cooperating with your MSP than handing off responsibility entirely. Having a service provider that sits outside your company provides a valuable perspective that’s not subject to the specific internal machinations of your business. This perspective is based on the latest industry best practices and the most up-to-date solutions. For example, the DevOps approach to the workflow between software development and IT teams has emerged over the past decade or so, yet many firms have yet to adopt it, despite the model’s many benefits, including better security as software is consistently and frequently updated.
4: Access to the latest and greatest computing resources
When your business has access to the latest and greatest computing resources, your customer experience improves drastically. Also, your business can make these resources available to your customers more quickly and easily with outsourced IT services. As IT service providers sink or swim on the quality of their technology, companies that outsource can usually bank on gaining access to the best technology solutions on the market today.
To delve into these benefits more deeply, we’ll take a look at Software as a Service (SaaS) and Hardware as a Service (HaaS).
When your business has access to the latest and greatest computing resources, your customer experience improves drastically.
What are SaaS and HaaS?
Software as a Service (SaaS) is the practice of renting software, usually on a monthly or annual basis, from an IT service provider. You get access to the application, and a working copy of files and information. The service provider maintains all the code and updates the software, meaning that if there is a problem, the provider will solve it. The benefit to the business of the SaaS model is that you no longer have to pay for every system software application as the vendor is providing it.
Hardware as a Service (HaaS) refers to companies buying IT packages that typically comprise hardware, software and maintenance on a monthly or annual basis. Often, this bundle will include features that were previously unavailable to a specific client. With HaaS, the software is monitored and managed, usually from a central location. This allows the management team to track the operating status of a cloud-based system.
When compared to traditional on-premises hardware, software, and services, SaaS and HaaS give businesses greater control over the quality of their products. With SaaS, a company that has paid a subscription fee for its software does not have to maintain and run its own servers. It’s easy to understand why businesses are drawn to this type of IT. It’s simply much easier for them to take advantage of what SaaS has to offer, especially in today’s environment when technology is constantly evolving and so is the industry as a whole. The same goes for HaaS.
How SaaS differs from traditional IT services
SaaS services are hosted at remote data centers. There is no need for a company to maintain the infrastructure or hardware that hosts its software. Additionally, companies can benefit from receiving prompt updates, upgrades, bug fixes, etc. by having software run by an IT service provider. There are many benefits of SaaS as opposed to traditional IT services. For instance, companies that use SaaS often report lower cost infrastructure costs. This allows for resources to be allocated to tasks that generate income.
A recent forecast by Gartner illustrates the likely growth trajectory of SaaS. It forecasts worldwide spending on cloud application services will expand to US$145 billion in 2022 from US$103 billion in 2020.
A business that outsources its IT services can enjoy a simplified management process, without having to worry about day-to-day IT operations.
Is outsourcing right for your business?
The most important question to ask when deciding whether to outsource is if it’s really worth it. The best approach to making an informed decision is to assess all the advantages and disadvantages of both options. Therefore, companies must compare the cost of in-house service provision versus outsourcing.
Even though outsourcing may sound like a good choice, it is important to read all the terms and conditions to make sure you understand the process and get the best outcome for your company. The most important first step is to talk to an expert IT solutions provider to see what your options are.