Category Archives: business agility

Guest Post: Outsourcing IT – Is it Helping or Hurting Your Business Agility?

This is a guest post and does not necessarily reflect the views or opinions of GreenPages Technology Solutions.

Bob loves coffee. He loves coffee so much he’s making a career out of it. As Bob contemplates opening his own coffee shop, he’s confronted with a big decision: ‘Do I create my own model and serve up coffee in a unique way or do I join a franchise?’

A franchise is appealing as Bob feels he would have an immediate customer base because of the reputation of the brand. But he also knows that he’ll have to give up the model of something new and unique into the neighborhood, where his passion truly lies.

outsourcing ITThe franchise choice would be quicker and safer and probably yield some profit. Opening his own coffee shop is more risky but Bob gets to follow his passion for coffee and, if successful, has the potential to be very profitable if it resonates with the locals.

I worked in the ‘traditional IT’ model for about 15 years. I’ve been in the room where executive management is telling IT management to provide a solution that supports some business goal, “no excuses!” There were times when I hated those ‘discussions’; the demand was inefficient and disruptive and always came at a time where my distributed system design was in full swing. It forced me create something I felt was clumsy and inefficient like forcing a round peg into a square hole. Nevertheless, I’ve seen smart people get creative and do amazing things and the business flourishes, despite the crazy demands. It was the IT team’s ‘Scotty moment.’

Some businesses may not be a good fit for outsourcing IT services, regardless of how efficient and cool we Architects and Engineers think they are. Many executives who have gone the external cloud route find that they lose agility. Why? Because they lost the ability to share their vision and business goals with IT. Instead of talking to an internal team within the company culture, they have to talk to contracts and SLAs and some services simply aren’t possible. In this case, internal IT may be a better fit for business goals and agility, like Bob’s coffee shop where he wants to offer something unique to his customers, he has control of the model.

On the other hand, startups who want to hit the ground running and don’t have a complex set of applications, may find a predefined outsourced model makes more sense, like the coffee shop franchise model. Maybe an established company can simply move their offerings to an outsourced model, but larger established companies can fall into a special trap, where they invest heavily in the ‘Cloud’ but realize they have to keep their existing infrastructure to support some applications that aren’t ready – the worst of both worlds from a cost perspective. So, a mature application discovery phase and well-defined time-line for these business goals is crucial.

Every smart company looks for ways to improve agility and efficiency. Both insource and outsource models have their merit. It will be interesting to see how these decisions affect the success of both small and large companies in their endless varieties in the long term.

I’d love to get your perspective on this subject, so please feel free to provide some feedback and/or your own stories of IT success or disillusionment.


About the author

Mark Macinnis is a Cloud Architect and Performance Analyst at Teradata. He has over 20 years of experience in enterprise IT engineering, planning and building distributed systems to support multiple locations. In his current role, as well as his past role at Pearson Education, Mark has supported robust applications used to help the organizations stay ahead of market trends.