When a company gradually outsources individual services that were previously provided on its own, this is always linked to opportunities as well as risks. Here we get to the bottom of the special case of IT outsourcing.

Why is outsourcing so popular, particularly in the area of IT consulting and cybersecurity? The IT sector is changing rapidly. Security risks are increasing and new software solutions are constantly coming onto the market. It therefore makes sense to outsource individual tasks, especially in the IT sector. This may relate to cybersecurity, but the implementation of new CRM solutions or other software applications is also quite complex. External providers increase efficiency and usually also save costs.

A short definition

In fact, outsourcing, i.e. the outsourcing of certain tasks and production steps, is known from many different industries. Car manufacturers that employ suppliers also make use of outsourcing. External service providers also come into play at call centers.

that IT outsourcing In turn, the rapid digital transformation has once again gained in importance. This is because generalists, such as those employed internally by many companies, often lack the appropriate expertise for complex tasks, such as the implementation of new software solutions.

As a result, more and more companies are thinking about outsourcing their IT to external providers, at least for a certain period of time. Alternatively, become Tailored solutions for specific applications and problems wanted through an IT consultant.

What types of IT outsourcing are considered?

IT outsourcing often makes sense even for small and medium-sized companies. Denn With increasing size, the topic of cybersecurity is becoming more and more important. In addition, large amounts of data are already being generated in customer service alone.

In principle, there are three different options when it comes to IT outsourcing in companies:

• With the so-called offshore outsourcing Are the tasks and services that have been completed to date by an internally based IT department delivered to an external Providers abroad outsourced. Communication with this foreign IT service provider then takes place primarily via e-mail, telephone or even VoIP.
• At Onshore outsourcing On the other hand, the headquarters of the external service provider are located within Germany. This eliminates language barriers or potential socio-cultural hurdles. It is possible to imagine a Outsourcing the entire infrastructure. You could also Application outsourcing the services are provided on your own PCs by external specialists.
  
  
• With the so-called Nearshore outsourcing Is then a certain spatial or geographical proximity to external IT service provider wanted. In the European context, this generally means that Western European companies cooperate with service providers from Eastern Europe.

Each of these models comes with specific Advantages and disadvantages linked. For example, outsourcing can reduce internal costs, especially when companies outsource their tasks in the IT sector to countries with lower wage levels.

As drawback However, must language barriers, socio-cultural hurdles As well as the different time zones be named. The latter is one of the reasons why outsourcing models, which outsource the IT department to Eastern Europe, are quite popular with many German companies.

This is because the headquarters of both the client and the external service provider are only a few hours away from each other by plane. In addition, the time zones are the same, which means that the standard working hours are at least similar.

What are the benefits of outsourcing?

Loud Federal Agency for Political Education Can be completely different areas of responsibility and work steps Outsource. Starting with research and unfolding about the Procurement of materials up to IT consulting.

As a rule, companies that outsource certain work steps to external service providers expect cost savings and greater efficiency. Access to expert knowledge must also be mentioned as a further advantage.

In fact, digital transformation makes specialized expertise in IT issues a decisive factor for economic success. And not only for global corporations and large companies, but also for companies from the SME sector.

If this know-how, such as in cybersecurity or the selection of suitable customer management solutions, is not available in your own company, outsourcing tasks definitely makes sense.

The majority of the companies surveyed cite the following advantages as reasons for IT outsourcing:

• The more efficiently the IT department works, the smoother the entire operation. Simplified work processes save costs, and new customers generated through improved marketing increase profits.
• External service providers take on unpopular tasks for their own employees. As a result, a company can focus entirely on its core business and score points here with special expertise.
• As part of digital transformations, companies' IT departments are constantly faced with new challenges. This applies to CRM solutions, but also issues relating to cybersecurity, which are often too complex for your own employees. Only those who are well positioned here remain competitive, while cyber attacks repeatedly paralyze even small and medium-sized companies, which are poorly protected.
• Last but not least, companies that outsource their IT department remain very flexible. No capital is tied up by computers and high-quality equipment. In addition, changes in the company structure, such as new business areas, can be responded to promptly and without time-consuming recruitment.

An interim conclusion:

that IT outsourcing can therewith improve the quality of your own products or services and therefore represents a real competitive advantage.

Companies that employ external service providers can also react much more quickly to new business areas or reduced offerings than if all work tasks, including IT infrastructure, are performed internally. Despite this flexibility and scalability when using resources, each outsourcing, whether in production or in the IT sector, but also linked to disadvantages and risks.

Disadvantages and risks of IT outsourcing in a nutshell

Among other things, the Quality controls with external service providers difficult. In addition, companies that outsource certain work steps or services depend to a certain extent on their partner companies.

Just When outsourcing offshore, you can In addition Language barriers and cultural differences cause misunderstandings.

If the partner company is also in a completely different time zone, communication and coordination of work processes can be a real challenge. This raises the question of whether — and if so where — IT outsourcing makes sense.

When does outsourcing make sense?

In fact, it is important to weigh up the pros and cons. Because the Cost savings and increased efficiency are just one aspect.

Conversely, it can be difficult to coordinate your own employees and the external service provider, especially when longer distances or language barriers make communication difficult. She also falls Assessment of the expertise of the external service provider non-specialist board members and managing directors often difficult.

Nevertheless, IT outsourcing makes sense, especially for companies that are growing rapidly. Because anyone who outsources IT remains flexible and does not tie up capital unnecessarily. Nevertheless, cyber security and customer management systems are optimally maintained and can be adjusted at any time if necessary.

Tips for choosing an external IT consultant

Once the decision has been made to outsource the IT department or at least parts of it, a suitable IT consultant and implementation partner must be sought.

The first question is whether the outsourcing should concern the entire IT infrastructure or just an individual project. Denn Not every external service provider can offer an all-inclusive IT service.

In this respect, the tasks to be outsourced should be clearly defined in advance of the search for an external provider:

• Is it about the entire IT department or just parts of the system?
• What exactly is support needed for (for example IT security, cloud computing or even CRM solution)?
• Which tasks and decisions are delegated to the external service provider?

In fact, there is also the question of which hardware and software technologies are needed to implement the desired goals and who orders them.

The time factor that both sides estimate for a planned measure, such as the implementation of new software, should also be clarified in partnership. Because misunderstandings and disappointments can only be avoided through detailed agreements.

The casting starts

As is often the case in life, a written checklist helps when looking for an external IT consultant or implementation partner.

• Are you looking for a specialist provider, for example for CRM management, or a generalist?
• What is the focus of the services that are to be outsourced?
• What budget is available for the planned IT service?
• Where — in which city or which country — should the IT consultant be based?

It often makes sense to have physical proximity between the company and external IT specialists. After all, cyber attacks or even the introduction of new software usually require on-site appointments. In addition, time is worth money, especially when it comes to computer problems.

Your cloud and implementation partner is happy to advise you

As an ISO-certified full-service IT provider, the MDS Group attaches great importance to trusting cooperation with its customers. In addition to an all-inclusive solution for IT, only individual areas of activity, such as cybersecurity, can be supervised. This is becoming increasingly important, so that the MDS Group offers robust cyber security solutions for its customers.

Individual solutions in the area of cloud services are also part of the renowned IT service provider's prime discipline. Get advice and decide together with the experts from the MDS Group which parts of your IT infrastructure you will outsource in the future.

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