Over the past few years, enterprises have grown comfortable turning over certain IT functions to an outsourcing partner. This trend has more recently extended to the outsourcing of IT infrastructure (servers and the systems required for servers to run efficiently), to data center colocation, managed hosting and managed services providers.
In fact, Gartner predicts that by 2012, 20 percent of businesses will own virtually no IT assets, a testament to the potential cost and performance gains that firms can realize by leveraging an outsourcing partner with expertise and capabilities lacked in-house.
Smart Business learned more from Pete Stevenson, CEO at Latisys, about how IT infrastructure outsourcing (ITO) differs from the outsourcing of IT services, the primary benefits of ITO and where ITO is headed given the challenging economic and business climate.
Many firms outsource IT services, but what does it mean to outsource IT infrastructure?
Outsourcing IT infrastructure is a critical decision made by companies once they have concluded that a third-party provider can run the infrastructure more cost-effectively, with improved capital management, specifically defined service level agreements (SLAs) and increased flexibility. It means the decision-makers in a company want to stay focused on the core growth and management operations of their business, and want a supplier they can trust with the rest.
What are the benefits of outsourcing this type of IT infrastructure?
While there are many economic and business advantages that can be realized by outsourcing IT infrastructure, I’ll focus on three.
First, strategic outsourcing can deliver savings on capital expenses and a reduced total cost of ownership (TCO) for the organization. Instead of making heavy investments in power, cooling, security and network access, for example, a firm can leverage an outsourcing provider’s investments in technology, technical know-how and data center infrastructure for a best-of-breed solution without the burden of continuous capital investment.
Second, a firm can leverage SLAs to ensure that IT infrastructure availability and performance sync with the firm’s business objectives. These service level agreements help guarantee performance delivery by including economic penalties that hold the outsourcing provider financially accountable, which may vary from company to company if IT infrastructure is managed in-house.
The third benefit is the ability to augment internal skills with the expertise of the outsourcing provider. This can be a distinct advantage when it comes to managing service delivery across platforms providing load balancing, security, storage and backups. Benefiting from this expertise without having to purchase, own, operate or maintain data centers — or invest in training required to manage these systems — is of real value, particularly for firms with data center facilities unable to grow or accommodate increased power density and efficient cooling.
