* Can surpassing internal SLAs shield the threat of outsourcing?
Over the past several weeks, I have covered two ideas for IT professionals to deal with as they consider the threat to their job posed by offshore outsourcing. First, I discussed focus on jobs that benefit the business using both technical skills as well as language and cultural affinity. Last week, I discussed the reaction of some to unionize IT workers. This week, I want to explore the effect of internal service-level agreements on the outsourcing decision and what this means for IT managers and IT executives.
Service-level management applications vendor Oblicore recently surveyed 400 service providers and user organizations. Of the 47% of respondents who were from user organizations, almost half saw failure to meet internal SLAs as a precursor to the internal IT functions being outsourced.
It seems reasonable to think that if the internal IT organization cannot meet the business needs, outsourcing to someone who can is an idea that organizations will consider. However, is the reverse true? Can achieving or even exceeding internal SLAs ensure that your IT department is safe from the outsourcing threat?
Outsourcing and offshoring may be undertaken for many reasons including:
* Cost reduction.
* Technical innovation (by leveraging the experience of the vendor).
* Access to the vendor’s sophisticated infrastructure.
* Quick addition of significant numbers of trained resources.
* To address lack of IT management depth.
* To address poor IT performance.
Given the variety of reasons for an outsourcing decision, I do not believe achieving internal SLAs will eliminate the consideration of outsourcing. If the business is experiencing high growth, there may be a lack of confidence that IT can continue to meet SLAs. If technology is changing rapidly, the IT organization may not have the resources to handle the daily management tasks as well as adjust to new IT developments. SLAs may be met or exceeded by using too many resources, driving costs too high. Achieving SLAs is only one of the challenges facing IT management. Cost management, strategy development, innovation, staffing, and training must all be balanced to be truly effective. If outsourcing part or all of the business is perceived to better maximize the sum total of these issues, outsourcing should and will be contemplated.
So where does this leave IT managers and IT executives? I think it means constantly evaluating the mix of internal resources with specific, multi-sourced outsourcing engagements to find the best balance of costs, innovation, and service levels. Use outsourcing where it truly can do a better job and redirect your internal resources where they can have the most impact.
If you treat this as an either or decision, you will likely lose. Outsourcing everything to one vendor may mean your job significantly changes or goes away. And many recent articles have surfaced showing that these engagements have a mediocre success rate. Treating outsourcing as an evil to be avoided at all cost may leave you vulnerable to better and cheaper processes that can achieve the same SLAs with far less cost. Better to be the one thinking about how to improve the cost/benefit of IT services by leveraging external providers for certain functions than to find yourself in a surprise meeting with IBM Global Services, Accenture, Wipro, et al.
On another topic, EMA is conducting a Web survey exploring agentless vs. agent based monitoring in system management. If you can take a few minutes to complete this survey, you will be provided with the final paper when complete. This survey should take no more than 5 minutes of your time.
One final note. EMA is presenting a free webinar on Thursday, Sept. 22 at 2 p.m. EDT, titled “Dos and Don’ts of Service Level Agreements.” Please register for this event at EMA’s Web site .
