Near Contact. Is it a good idea to outsource part of my IT operations?

abril 30, 2023
/Nearshore IT


Is it a good idea to outsource part of my IT operations?

ITSM proposes a very interesting idea

ITSM proposes a very interesting idea: to recognize IT offerings towards the organization as a service which is defined as a value delivery vehicle for the business. This ideology proposes that the IT department is also a service provider that should consider itself in constant competition with external offerings with the objective of offering as many competitive advantages as possible.

Through this approach, the only difference that matters between an IT department and an external service provider is that the first serves exclusively the organization where it belongs while the second offers it’s services to as many companies as possible. This paradigm presents an interesting challenge to internal IT providers to keep up to date with trends and allow the business to remain competitive.

It’s evident an internal IT services provider and an external provider will have both advantages and disadvantages, for example: the first one will have an intimate and extensive knowledge about the organization it belongs to, allowing bespoke services to be created and grow. On the other hand, external IT providers can usually distribute costs and risks among several clients, allowing an IT offering that tends to be more developed and with a lower cost.

For this article, we will use the example of the Service Desk and we will try to use exploratory questions and possible answers to detonate an introspection that will hopefully culminate in the best decision possible for our organization and our IT department: Should I outsource my Help Desk?

1 Does the Help Desk contribute to developing core competencies in my organization?

This first question is, perhaps, the most important one and it consists in determine if developing the competencies required to have a truly competitive Help Desk add anything at all with the descending objective of the business’ vision and mission.

We can usually determine this in a simple way by identifying what is the type of product or service our organization offers and how. However, there is a chance of falling onto a trap when thinking about answering this question: there is a difference between benefiting from a Help Desk (which almost any organization will, independently of it’s nature) and benefiting from developing a Help Desk. Benefiting from developing a Help Desk means the organization could receive extra advantages from the financial and effort investment building and maintaining a Help Desk requires.

For example, a construction company would see benefits from implementing a Help Desk together with relevant ITSM processes such as Incident Management or Request Management. However, the discussed benefits come from operating a Help Desk, regardless of it is developed internally or outsourced. If, on the other hand, this hypothetical construction company has, as part of its vision, the objective of developing itself as a service provider in the long run and turn its own IT department in a separate company that will offer its services to other companies to diversify its operations then we have a totally different scenario. In this situation, the organization has a way to justify the investment required in developing a truly comprehensive Help Desk competency, seeking additional benefits in the future.

2 Do I have enough resources to develop my Help Desk in a reasonable timeframe?

ITSM philosophy and the spread of best practice through frameworks and standards, has positioned the Help Desk as a basic component for any organization that needs to get the best out if it’s IT resources. The correct implementation of this practice represents benefits in both the financial and the more subjective realms. The financial gains can be measured through ROI while the intangible benefits can be measured through VOI (Value on investment) that includes elements that are much harder to quantify financially such as user satisfaction and brand reputation.

When recognizing the positive impact of a Help Desk in an organization, the cost of opportunity of not having one becomes obvious. An organization that doesn’t have a Help Desk aligned to best practices, is an organization that is missing an opportunity to save resources and offer value through intangible benefits to its users.

When answering this question, we can find out if our organization has enough available resources to invest in the development of the competencies and compare against the scenario of not having them represents a net gain for the company. For most organizations developing these competencies to a level where they can bring true value can take years.

If our organization is not in a position where investing to develop a Help Desk aligned with best practices makes sense, it’s best to lean into an outsourcing strategy. Even if it’s within the organization’s plans to develop such competencies as an strategic resource for the company.

3 Does my organization have the necessary expertise to develop a Help Desk practice?

In addition to the financial investment, it is also necessary to hold a particular set of skills that can manage the implementation and operation of a Help Desk practice to a level where it can truly provide benefit to the organization. While this expertise can be acquired, the learning curve can be long and expensive for the organization. Specialized certifications are only a part of what is required given that true expertise comes from both academic and practical learning.

The organization can seek expertise through two main means: add experienced and expert resources to the team or develop current members of the team through specialized certifications. Both represent a risk for the organization because the strategy’s success depends on loyalty and convenience of the human resources.

Developing the competencies internally also represents a risk of suffering errors during the implementation and operation of the Help Desk that could impact the organization’s well-being. Absorbing this risk makes sense only when the organization expects additional benefits on top of what a Help Desk by itself can offer.

4 Is my organization aware of Help Desk implementation’s hidden costs?

The implementation of a Help Desk aligned with best practices is just a part of the story. To operate it and maintain it operating at its best capacity is a challenge onto itself. The Help Desk needs to lean into other critical teams to offer positive results during its operation such as talent acquisition. This particular team has a great influence in the success of the execution of a Help Desk strategy given that it must be capable of bringing the right talent in a timely manner. Once new recruits are hired, they must be recognized as recruits with specialized skills that might not be compatible with other human resources management strategies present at the organization. The Help Desk members is the most critical aspect of the practice, and the organization must be ready to care and develop them.

For example, a manufacturing company could have talent acquisition and retention strategies perfectly functional for people expert in working with industrial machines, but these same strategies might not be as attractive for specialized IT resources. Consequently, our company could appear as less attractive option for the talent we need to hire, and the recruiting process might be affected.

Another cost to keep in mind is the Service Management tool. Every successful Help Desk needs to have a service management tool that can assist the team to fully develop the Help Desk practice’s potential. The Service Management suite implies an obvious cost of licensing in most cases but also keeping the tool aligned to changes in business and updated comes at a cost that could be even higher than the licensing itself.

It is a good idea not to underestimate the impact of being able to exploit the Service Management tool’s potential considering the Help Desk is the beating heart of the IT operations and provides a very valuable opportunity to obtain information and develop metrics and statistical trends that ideally culminate in locating the improvement opportunities such as root cause solutions and pain point identification.

5 Do I want to use the best available tech without incurring in large investments?

Just as a Help Desks’ success relies greatly on accessing the best available talent, using the right technology tools can also have a big impact. Technology based tools can vary in quality, scope and price but this article is focused in professionally grade tech a Help Desk would use.

Phone systems

Phone calls are still one of the most popular ways to contact a Help Desk. It offers ease of use, agile communications and basically every employee has access to a phone. However, to support a professional Help Desk’s operation it is strongly recommended to equip the phone lines with additional tech that allows us to manage phone traffic in a smart and effective matter.

IVR

Interactive Voice Response systems are the ones that provide voice menus that allow users to interact with the phone system before reaching a Help Desk analyst. When an IVR is correctly implemented, it allows us to channel traffic to the right teams improving the time users must wait before reaching a live person. In some cases, it will also provide interesting information regarding the choices users make on menus in order to generate useful statistic information and enabling improvement programs.

ACD

Automated Call Distribution systems allow us to handle voice call traffic following a certain set of rules. It can be configured with a simple set of rules such as distributing the calls in a first come, first serve bases and assigning workloads in a round robin scheme or employ much complex rules like assigning calls depending on the user’s IVR selections and the Help Desk agent’s skillset. Even providing advanced priority rules depending on the user calling is possible. ACDs also allow collecting the call’s statistical information to enable analytics such as call duration, wait time for users and traffic patterns. This data can be used to enable informed decision making such as forecasting design and staffing schedules.

The investment required to implement these kinds of tools can go up to thousands of dollars depending on the size of the Help Desk so it’s often off-putting for companies. Specialized vendors often invest heavily in the technology aspect in order to offer the best possible service and then distribute the costs among a higher agent count spread among different customers. This way, customers only need to cover a smaller segment of the investment but enjoy all the benefits provided by this tech.

6 Do I need to free up my internal resources to participate in improvement projects?

In general terms we can categorize a department’s operation in two big segments: day to day operations and improvement projects.

Within the first category we can find all the activities that cover day to day operations to support business activities and are usually repetitive such as incident resolution, service request fulfillment and change implementation. A lot of these activities tend to be well documented and don’t have a high technical complexity.

The second category, arguably with a higher importance, is focused in the growth and transformation of IT operations to improve service and increase value delivery.  Within this category we can find activities related to the design and development of the IT strategy, incident prevention and general tasks towards the analysis and high impact proposals. Human resources focused on these activities require an intimate knowledge of the business they are serving as well as ample experience in their fields.

Ideally the distribution of these two aspects of operating IT should follow the mythical 80/20 rule but it’s common that business assign most of their time and efforts towards the day to day operations as it tends to have a more immediate impact. However, there is a very real risk in letting day to day ops to be so absorbent and take over most of the focus at expense of the longer lasting strategies. This results in IT departments to get stuck and, consequently, incur in having the business fall behind competitively.

Companies that are kidnapped by daily operative demand are excellent candidates for services outsourcing such as Help Desk because it allows internal resources to be freed to pursue more strategic activities without dropping day to day ops.

7 Does my operation require capacity flexibility?

Businesses operate following patterns known as PBA (Patterns of business activity). These patterns vary depending on the nature of the business. For example, retail companies tend to have an increased demand on periods like black Friday or Christmas where their operations increase over 70% but for a limited amount of time.

IT operations usually run in parallel to these patterns because the business demands more services during their peak periods. Companies can have a hard time to adapt their capacity timely to confront increased service demand incurring in excessive expenses or, even worse, not being able to satisfy internal and external customers.

IT outsourcing can enable the required flexibility to increase or even decrease capacity faster following the patterns of business activity because service providers can leverage different customers’ PBAs. This way, once patterns are identified, tailored services can be offered without important financial impact.

To conclude

In most cases the best approximation is to combine internal and external providers that to leverage their advantages and mitigate their weaknesses. The right combination of participation of each type of provider can vary from company to company and the criteria used to develop the strategy should consider the following elements:

  • The long-term benefit of developing the competency internally
  • The organizational disposition to develop the competency.
  • The financial capabilities to develop the competency.
  • The organizational knowledge regarding the competency

The purpose of this article is to instigate deep reflection that would help determine what is the right approach for our organization taking into account all the possible elements to obtain the maximum possible benefit. It is important that the strategy is developed in the most objective way possible recognizing the company’s capabilities and interests.

Operation models are often combined and customized but without a clear idea of what the organization needs at any point in time and, quite possibly in the future. Without considering the factors shared during the article achieving success with an outsourcing strategy would much more difficult.

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