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Mitigating the Risks of IT Outsourcing

Many businesses outsource one or more of their IT functions. The goal is usually to save money. Yet if you do not mitigate the risks involved, you could end up both losing out financially and failing to get the most from the arrangement. Here are some best practices to consider:

Consult your users. Ask for candid feedback about whether your company’s technology is meeting your employees’ needs. What help from an outside provider do you really need? Also contact other businesses that have outsourced. How did outsourcing help — or hurt — them?

Weigh opportunities vs. risk. Identify opportunities beyond cost savings. For example, outsourcing noncore IT functions — such as management of HR systems and supply-chain technology — could free up internal resources for projects you’ve put on the back burner but that have strategic potential. Then again, outsourcing too many noncore processes, or doing so improperly, could leave you with too little control of these functions and expose you to inefficiency and compliance risks.

Refine your relationship expertise. Many business owners believe that, once they sign the deal, the contract will take care of itself. As a result, they do not adequately manage the relationship and often find themselves in conflict with the vendor or stuck with unsatisfactory results. You will need new skills, processes and metrics to ensure the services deliver what you want.

In a global economy, IT outsourcing has become — in many industries — a competitive necessity. Whether your company is large or small, we can help you assess, negotiate and maximize the bottom-line benefits of an arrangement. Let us know what we can do for you.

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