IT outsourcing – the risks and how to handle them? - Coweso
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IT outsourcing – the risks and how to handle them?

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IT outsourcing – the risks and how to handle them?

Even for the non-IT companies, the IT infrastructure works as a determinant of success. Irrespective of the size of the company, every owner is likely to consider the idea of IT outsourcing at some point in their business journey. IT outsourcing services can deliver a range of benefits for any venture, but just like any other business decisions, it does not come without the associated risks.

Before taking the leap, brands should understand the risks associated as well as how to mitigate them to ensure the best outcome. Read on to know about the risks of IT outsourcing and how to alleviate them.

Loss of control 

Many companies are afraid that outsourcing will lead to a loss of control over their core business processes. When the total operation is done in-house by full-time employees, you will naturally have more control, but the same might be the reason for the delay in work.

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Tracking the processes and ensuring that it will deliver the desired results is more straightforward when done in-house because the outsourcers work more independently.

On the downside, if it needs to go through a single point of approval or finalization, which is often the case in small and medium enterprises that lack a large team of IT managers, it will delay the total process, leading to inefficiency.

How to handle it? 

More often than not, poor communication is the reason for not being on the same page with your IT vendor. Not being informed about what is happening in your company can be frustrating. The easiest way to solve this issue is to create a proper, written communication plan that should involve regular reporting. The top IT firms always maintain an appropriate protocol for client communication. They will not overstep any instruction provided by the client, be it a specific project or a long-term partnership.

Data security issues 

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Business data is valuable, and data security is a valid point of concern for every company. Data theft and data leaking can impact any company seriously leading to reputation loss and even legal proceedings. When you outsource your IT requirements to a service provider, you are naturally giving the vendor some control over your company data, adding to the risk of data misuse.

How to handle it?

It might look like, letting a third-party handle your core business information is not safe, but practically, your data is more secured with a reputed IT outsourcing company than in your own organization.

Suppose you are getting server setup services for hosting your business applications on the cloud. It will necessarily give some control over the applications to the managed service provider. The reputed IT firms are extremely careful about data security because they handle sensitive data of various clients. Even a whiff of loss in integrity can get their enterprise in serious legal trouble.

No digital means of data storage or transaction is 100% secured. Still, the servers of the top MSPs have the best possible protection to ensure safety from data theft and any malicious intents.

top it companies australiaDowntime 

Facing a downtime in critical business processes after you have outsourced the project is a logical concern. The contractor might not be available to attend to your call immediately, and it might take days before all the services are restored. This might mean not being able to use the resources for a period of time, which can considerably impact your business processes.

How to handle it? 

When you are hiring a service provider for cloud hosting or other IT projects, always ensure that the contract includes a clause that explicitly mentions downtime protocols and how quickly that should be resolved. There should be an established plan for handling such situations, and you must not sign the contract unless you are clear about how the MSP will handle such situations.

Service quality 

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When you are outsourcing your business IT processes to a contractor for the first time, you are not sure about the service quality the vendor will provide, and you have to depend on the words of the vendor. This naturally involves a good deal of risk. If the vendor does not perform as promised, you might be in a soup, and your business plan can be in trouble.

How to handle it?

Never look for a cheap service when you are going to outsource your essential business processes. We understand, every business has their budget restrictions, and affordability is an important consideration, but the low cost should not be the primary reason to hire an MSP, because quality comes only for a price.

Look for an IT solution company that is reliable, is concerned about the clients and has a reasonable and transparent pricing policy instead of cheap and complicated payment structure that will ultimately cost you more.

An IT outsourcing company concerned about the growth and success of their own brand value will always try to provide the best service to their clients because their growth is directly related to the growth of their clientele and market reputation does really matter.

it outsourcing servicesBinding contracts        

If you are signing a contract that binds you for a specific time with the outsourcer, you are taking a considerable risk. If you do not like any aspect of the service or just feel it is not the best match, you will not have the option to change your decision until the contract’s duration is over. Even the prominent brands with a perfect record might not be the best match for your needs, but a binding agreement will prevent you from moving to another contractor.

How to handle?   

Always opt for open-end contracts that will not bind you for any period of time and give you the complete freedom to part ways amicably if you want to. You might need to provide prior notice for a short span of a month or less depending on the contract. The open-ended agreements might be more expensive, but they are always the best option for businesses of every size.

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Outsourcing your IT requirements comes with its share of risks, similar to those you have to take while hiring a new employee. The best thing is you can mitigate all these risks considerably by following a proper process for IT outsourcer recruitment. Any decent provider of IT services for business will ensure that you get the advantages of outsourcing while minimizing the risks.

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