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5 IT Outsourcing Myths Debunked
Myth 1: Cost reduction is the only benefit of IT outsourcing.
Truth: Increasingly, businesses are using IT outsourcing as a skills enhancer, with cost savings taking a back seat. That’s because nearly two-thirds (65%) of Chief Information Officers (CIOs) report that skill gaps are hampering their IT strategies.
IT service providers give businesses access to multiple skills, including the expertise of top-tier IT professionals — at a fraction of the cost of full-time staff members. And they can quickly implement tried-and-true processes and best practices that the business would otherwise have to spend time and resources to develop.
Top reasons global technology executives outsource IT:
- 49% Frees resources to focus on core business
- 46% Provides access to skills not available in-house
- 45% Saves money
- 39% Improves flexibility in use of resources
- 15% Improves ability to innovate
Myth 2: Small to medium businesses can’t benefit from IT outsourcing.
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Truth: IT service providers have the economy of scale to provide small to medium businesses with more cost-effective IT expertise and resources, increasing scalability and reducing the need for costly up-front investments to support the same capabilities in-house. Managed IT service providers also enable businesses to concentrate staffing resources where they’re needed most.
Cloud-based solutions and subscription licensing models, in particular, give smaller organizations access to the same level of IT services that larger companies enjoy. Small to medium businesses are often well positioned to take advantage of these service models because of their tendency to be more agile with fewer legacy technologies to consider.
"Smaller organizations are more likely to struggle to fill traditional IT roles such as business analysis, project management and development."
Myth 3: MSPs can only support the most basic IT needs.
Truth: Any IT process can be outsourced, from routine tasks to more complicated, large-scale projects. If you have a need, there’s probably a Managed Service Provider (MSP) out there that can take it on. While managed hosting, security and storage/backup services are among the most commonly outsourced IT services, that won’t stop you from finding providers who can take over administration of a cloud platform or who can easily manage an entire end-user computing environment.
2019 Expected IT budget allocation for managed services:
- Managed hosting: 13%
- Managed security: 10%
- Managed storage/backup: 9%
- Managed hardware support: 9%
- Managed communications: 9%
- Managed cloud infrastructure : 8%
- Managed business apps: 7%
- Managed networking: 7%
- Managed IT help desk: 5%
- Managed print services: 4%
- Managed mobile computing: 4%
- Other/don’t know: 15%
Myth 4: Disruptive innovation isn’t possible with IT outsourcing.
Truth: Cost reduction is no longer a top reason for organizations to partner with MSPs. According to The Deloitte Global Outsourcing Survey 2018, more businesses are pivoting to disruptive outsourcing solutions that can give them a competitive edge by transforming operations and “making them more agile, efficient and effective.”
In particular, businesses want to gain access to the innovative capabilities and improved performance offered by the cloud.
70% of IT leaders believe their service providers have a reasonable or advanced ability to implement disruptive solutions.
Myth 5: IT outsourcing will make the business less secure.
Truth: In 2018, 70 million records were stolen or leaked due to poor database configuration.5 IT security is an arms race, and businesses can’t afford to let their guard down. However, 43% of IT decision-makers report that ensuring data security will be a top challenge in the next three to five years as data growth accelerates. That’s because many businesses, especially small to medium organizations, can’t afford to dedicate the highly specialized staff and resources necessary to combat potential threats.
To earn and maintain the trust of their clients, reputable MSPs invest heavily in data protection and IT security expertise, making these partnerships an affordable way for organizations to enhance security.
62% of small to medium businesses say they lack the in-house skills to deal with security issues.
Deloitte. (2018). The Deloitte Global Outsourcing Survey 2018.
Harvey Nash/KPMG. (2018, May 25). CIO Survey 2018: The Transformational CIO.
Insight. (2019, May 6). 2019 Insight Intelligent Technology Index.
Raconteur. (2018, May 3). Future of Outsourcing.
Spiceworks. (2019). The 2019 State of IT. Spiceworks.com/marketing/state-of-it/report.
Symantec. (February 2019). Internet Security Threat Report.
VansonBourne. (2019, Mar. 26). Underserved and Unprepared: The State of SMB Cyber Security in 2019. Continuum.