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Outsourcing Opportunities for SMEs

by: Sarah Joson

Thursday, January 26, 2012 | Outsourcing News |

Since technology is constantly evolving, companies - especially small to medium enterprises (SMEs) - have a hard time coping with the latest trends. Keeping technology up-to-date and having what the big players have not only empower the smaller organizations but also keep business offerings fresh and more marketable to consumers.

For SMEs, having to upgrade the technology means more overhead costs as it is always changing.  But most players in the SME division cannot afford to continuously invest on temporary features, which is why some of them consider outsourcing minimal or their entire IT operations.


Outsourcing opportunities for SMBs to resolve IT needs

Clive Longbottom, Service Director at Quocirca, shared with executivebrief.com other alternatives that can be adopted by SMEs to resolve their IT needs.

Weighing in on the Outsourcing Option
Companies that do not outsource have one thing in common - they have full control over the entire operation, which means triumphs and downfalls will be credited to them. The downside of not outsourcing, however, is they should be able to provide ample facility to accommodate IT equipment.  The other one is having adequate technological know-how in managing the operating systems and maintaining the facility. Lastly, keeping everything economical and congruent with the business’ needs is also considered a struggle for SMEs.

Segmented Outsourcing for SMEs
Outsourcing a segment of an operation, like support, to a third party provider is probably the easiest way to alleviate issues internally and maximize the potential of a company’s IT infrastructure.  Larger organizations are often the ones that make use of this by hiring systems integrators like IBM, CSC, and HP to manage their data center fully or otherwise.

By doing so, they can have a flexible IT environment and lesser issues to deal with because they now have a supplier that will shoulder the tasks for them. In outsourcing, service level agreements (SLAs) are also customized according to the needs of the company, usually covering recommended and basic processes like replacement and repair of equipment, root cause analysis (RCA), and base problem identification, along with remediation where possible and the overall asset life cycle management from the installation, regular systems checkup and replacement, depending on the coverage of the warranty of the kit.

SMEs are still accountable for the Data center and IT Equipment.
When SMEs outsource the IT function, they will be given the option to keep the equipment in-house or be located in a shared facility for all the SMEs’ IT equipment. But since they are sharing the space and in fact, the owners of the IT equipment and software, SMEs are still accountable for them.  SMEs are also given the option to adopt the design presented to them by the provider. This reinforces the fact that SMEs need to have basic knowledge in creating the appropriate environment for their IT infrastructure. If an SME decides to outsource IT and opt for the co-location setup, third party providers are expected to manage the facility, power distribution, uninterruptable power supplies (UPS), cooling, internet connectivity, and physical security of the data center.

Have the Service Provider do it All for You.
Another popular model is the hosted one. SMEs can also acquire the services of a hosting supplier, which will provide the location (whether shared or private) and IT equipment.

One of the most talked about versions of hosting is the cloud where it acts like a virtual data center, which means it is accessible almost anywhere, although the leading model is still SMEs renting IT equipment, along with the operating system like Linux or Windows, and gradually adding applications as the operation goes. The host manages the facility, equipment, and operating system, while the SME only looks after the applications. Granted SMEs opt for this model, they can acquire or rent physical or virtual equipment (depending on the needs of the business) and even hire popular providers like Memset, Rackspace, UK2, and 1&1.

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