The Death of the Traditional IT Model

For decades now, there has been two opposing choices in managing IT- do it yourself, or outsource it.

With increasingly technical, business and compliance complexity, the old school concept of the fixed internal IT team is becoming increasingly expensive and unrealistic. The fact is, a myriad of IT skills are required in today’s IT environment, but rarely are those skills required full time, and they are expensive and hard to maintain and grow. Expensive and underutilized are rarely good bedfellows.

The industry answered the call for help of those seeking to avoid IT management with the all-inclusive fixed price managed service offerings. This brought about the rise of the Managed Service Provider (MSP) both big and small. These offerings, while compelling on the surface create another set of issues and uncertainty for business and often have unintended consequences.

First of all, the nature of the relationship is conflicting – the provider, in order to retain profitability must reduce labor costs on accounts by utilizing as little actual labor as possible and then using as cheap of labor as possible. The client is seeking services and is focused on ensuring productivity, wanting to maximize the service their provider offers. This rub creates an adversarial relationship, especially when you consider these are often multi year contractual relationships. In my opinion, no service provider should force you contractually to continue doing business with them. After all, if the service is fantastic, why would you leave? If they believe in their product and your satisfaction with it, then no contract should be required. After all, it’s not like they are recouping hard costs for getting you signed up (like with a cellular phone and a new service contract).

And of course all inclusive is a myth… as virtually all of these providers will have a list of exclusions that includes such things as hardware and software failure, viruses, etc. If you ever really read one of these lists of exclusions, your first response will be ‘really?’ It sort of looks like you pay a fixed fee for things to work then start paying extras when they don’t. Many times, these costs can greatly exceed the fixed cost, and always seem to come as a surprise, and the entire concept of ‘fixed price’ seems not to jive well with ‘exclusions’. So, that IT budget you set your contract to may be irrelevant and actual costs may balloon.

They also, to control the environment to their best ability, will NOT partner with any internal IT, ensuring that you have NO ability to operate outside of their control. Finally, they will place requirements on you in terms of your network, PC conformity, software conformity, etc to reduce costs and complexity. At some level, this sounds ok, but really, shouldn’t you have the technology you want and need, not that which is most efficient for your IT vendor to support? Isn’t technology supposed to enable productivity? Aren’t we in the age of mixed environments, mobile computing and cloud?

All of these things drive me crazy. As a business person, I expect my technology to support me, and my provider to do the same. I don’t expect to be given rules, limitations and exclusions.

But enough of a rant on what is not working… So, what is the answer?

Actually, the answer is simple and compelling and it has to do with the integration of multiple modes of support to best meet your business needs, size, budget and complexity. It is what we are calling Flex-Sourcing at ISOutsource. It is a partnership between internal IT, and a menu of services that can be delivered in multiple ways to meet your business needs. Frankly, if you have high maintenance users and they need to maintain productivity, then you should have full and unlimited access to support. That should be available from a dedicated local team of IT professionals large enough to handle multiple simultaneous instances of support and should be something you can do on a fix price or time and materials basis depending on your need and budget.

Also, key expertise should be available on an as needed basis as well as included in any proactive plan with scheduled visits on a monthly, weekly, or daily basis depending on your needs. In house IT should be sized appropriate to ongoing daily workload and should have general skills to take care of ‘normal business’ (depending on the size of the business, this may include NO employees, or dozens of employees) and key expertise that is rarely needed (but when needed is critical) should be outsourced. Outsourced IT should be a mix of proactive planning and reliable and immediate reactive services with a broad base of technical and consultative skills with a team large enough to ensure consistent support throughout the year (ever have that lone IT consultant go on vacation then have a server go down?) with a primary team of consultants familiar with account and able to provide backup as needed. Your IT consulting partners are there to enhance your existing team, partner with them and make them look good, not replace them. They are there to help adjust to large project needs, cover vacations, provide key skills and offer consultative support and training.

All of this can be done within a budget and within your required cost parameters. The idea that time and materials = suck your bank account dry is simply counterproductive and not sustainable as a business model. By intelligently budgeting a mix of proactive work to reduce downtime and reactive expected hours, you can have a very accurate budget to spend to with controls to keep an eye on things. When an emergency occurs, spend will go up, but when things are running well, spend can be lower than normal. Additionally, the team can rapidly flex up or down based on changes in your business and adapt to your needs, which is another challenge with fixed long term contracts.

Ultimately, the goal of IT is to ensure that your business is supported by its technology. This requires an increasing based of expertise that can become so broad based that it makes no sense to hire individual experts for every need. The days of needing a support desk person, a network engineer, and a software support person are gone for the most part. The managed service provider model of ‘simplify, reduce costs, reduce complexity, reduce support’ sounds reasonable until you realize that your need is to ‘increase productivity, enhance competitiveness and grow your business’. Those two differing sets of requirements may not match up well in many cases, though there is a place for that model too.

So, while internal IT is NOT dead, the expectation that you should hire a person for every need should be dead (or the costs of it will destroy your business). Nor is the concept of managed IT services dead… though it is fitting into a more narrowly defined space in the market all the time. Service providers have to flex to fit your needs. Cloud computing and the growth of bring your own device and mobile computing (amongst a host of other technical, business and compliance challenges) are changing how you want your technology and support delivered. Never forget, you are the customer, it is your business, and technology is the foundation upon which your productivity will be built in many cases. Expect more from your IT provider. Expect flexible solutions that can go where you need them, at a cost that makes sense, whether you have no IT employees and don’t want any, or you have a large team and simply want a partner, to anything in-between.

IT has come a long way, and is continuing to evolving rapidly. Its time to stop holding onto the past and flogging dead IT models that can’t meet your needs.

The right approach to IT will leave you feeling Happy, Productive and Supported. And it has always been about Happy Computing!

Richard Brunke

Leave a Reply

  • (will not be published)

XHTML: You can use these tags: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>