This article entitled “Choosing the right Outsourced IT Partner” was written by Sean Hegarty who is Operations Director at HCS Business Solutions. Sean holds a BSc in Law with Business, an MSc in Technology Management and has been working in the field of IT Service Management and IT Outsourcing for the past 17 years.
I worked with an SME (Small to Medium Size Enterprise) last year who in my opinion suffered greatly because they chose the wrong Outsourced IT Partner. The SME in question had not considered the importance of making the right choice when it came to choosing an Outsourced IT Partner and instead had simply chosen the cheapest option at the time without considering other important factors.
I’ve written this article to assist SME’s in understanding some of the issues surrounding choosing the right Outsourced IT Partner. This article will consider questions such as;
• Are all IT service Companies the same?
• Why do SME’s find it difficult to change Outsourced IT Partner?
• What’s the difference between Professional Buyers V’s SME Buyers!
• What should your Outsourced IT Partner be doing for your business?
• Case Study – Small Business with 15 employees.
• What’s the Opportunity cost of not choosing the right Outsourced IT Partner?
• How to choose the right Outsourced IT Partner?
• Top 20 questions for a prospective new Outsourced IT Partner.
I will give you my top 20 questions for a prospective new Outsourced IT Partner that will ensure you leave no stone unturned in your search for the best Outsourced IT partner for your business thus ensuring that you and your business have the best IT environment possible to enable your people to achieve their goals!
Are all IT Service Companies the same?
Many businesses have the same Outsourced IT Partner they’ve had for years. You’re hoping that your Outsourced IT Partner has moved his or her business forward with the times and is up to date, employing high quality people, choosing the right industry partners and is able to offer and provide the full range of solutions and services that your business requires in order to make the best use of information technology. The truth is, however, that not all IT companies are equal. Some don’t change at all and some only marginally while others grow and expand and are ahead of the curve and know what’s coming down the track. Is your Outsourced IT Partner ahead of the curve, proactively coming to you with ideas that will save you time, make you money and enable you and your business to reach its goals?
Why do SME’s find it difficult to change Outsourced IT Partner?
Sometimes SME’s find it difficult to make decisions when it comes to thinking about changing Outsourced IT partners. In much the same way as anyone would be reluctant to change their bank, or accountant, solicitor, doctor or dentist there are often long relationships involved, friendships in some cases, and generally people just won’t change unless there has been a catastrophic relationship breakdown of some kind!
If you are not entirely happy with your current Outsourced IT partner and find yourself saying things like “ better the devil you know!”, or “I’ve been with them for years I can’t change”, “they know my systems inside out”. “I really like “Bob”, he’s like a friend” then it’s probably time to start asking questions “Can I do better? Can my business do better?” and consider looking for a new Outsourced IT Partner.
What’s the difference between Professional Buyers V’s SME Buyers!
Just for a moment let’s consider the difference between professional buyers and SME buyers. Professional buyers, usually found in enterprises or larger organisations, are dedicated, trained, specialist personnel who are ruthlessly focussed on their role and the objective in hand. They are focussed on the quality and cost of the product or service that’s being provided and they do their research thoroughly which usually means contacting many suppliers of the product or service and benchmarking them against each other across a whole range of criteria and metrics. When it comes to decisions there’s no blind trust based on history or faith and goodwill, just smart trust. Smart trust, I’ll trust your company because I’ve done my research and based on my research I’m prepared to do business with you. I know what I’m buying and I’ll know when I’m not getting it to the standard that I expect. I understand what my options are and if I’m not happy then I will, without hesitation, exercise one of those options if I wish to change provider.
SME’s rarely go to such lengths when looking for a new Outsourced IT Partner simply because they don’t have the resources. Don’t get me wrong, I have come across excellent and thorough SME owner managers who can really put you through the “mincing machine” and I’m sure most owner managers could if they had the time. In reality however it’s easier not to change and to stick with the existing arrangement because you know them and there’s a trust on some level. And you don’t want the hassle and risk of looking for a new Outsourced IT Partner and starting a new relationship.
What should your Outsourced IT Partner be doing for your business?
If your business is dealing with a single individual or a small IT company that is static, not growing, not progressive then there’s a high chance that you are not getting the ICT services that your business needs. I’m not just talking about fixing your PC or server when it breaks down. I’m talking about all the other services and benefits that you’re Outsourced IT Partner should be bringing to your business to ensure that you are progressing, that your business is being informed about the latest technologies and that your ICT technology is fully supporting your business goals.
1. Your Outsourced IT Partner should provide you with a service level agreement (SLA) which sets out in detail exactly how your relationship will work on a day to day basis.
2. Your Outsourced IT Partner should provide you with a high level account manager who will be available to you at all times for advice and guidance.
3. On a consistent basis, your Outsourced IT Partner should be making you and your business aware of new technologies and ways of working that are relevant to your business.
What if your current Outsourced IT Partner is not doing this? What is the cost to you and your business?
Case Study – Small Business with 15 employees.
Here is an example of a small firm that I came across last year. The firm had a fairly basic non-committal type IT Support contract with a local IT business. When a problem occurred they called their contact and someone would attend and work on the problem. Other than reacting when called their IT contact had little or no involvement with the client when it same to auditing, sales and recommending new services and products. Because the systems were so old breakdowns became more frequent. Downtime for staff was more frequent. The business as a whole was using 10 year old technology which was slow and “creaking at the knees”. It was almost like a badge of honour to some staff whose PC took 15 minutes to boot up. The company was still using an old fashioned tape drive for backups and although they were religiously changing tapes every day, no one actually knew exactly what was being backed up let alone whether or not the tapes would actually be able to restore data in the event of a disaster. When it came to considering any new software across the business it was always a problem because of incompatibilities with the old hardware and operating systems so business systems were never kept up to date. Staff member’s knowledge around business systems was 10 years out of date. The IT firm fixed things that broke but offered little or nothing when it came IT direction and planning. One day the, out of warranty, server ground to a halt, there was data loss, two weeks of downtime and after the chaos the realisation by the business owners that they had to make a huge investment in new hardware, software and staff training all at once. It took months to recover from the disaster and months again to get the business back on track and up to speed with staff having to learn how to use the new modern IT systems.
Having made a huge investment the owners now wanted to get value and use the new IT system to its full potential but this was challenging given the culture engrained within the business of not changing, of not learning new things, of not being up to date. As a result the business has probably been set back a number of years by comparison to some of its competitors who upgraded their IT systems incrementally. In summary the costs of this reactive approach to information technology for this company were high when you total the cost of the new hardware, software and staff training along with the cost of the downtime and data loss and the opportunity cost of the business being set back years behind its competitors.
What’s the Opportunity cost of not choosing the right Outsourced IT Partner?
What’s the opportunity cost of not choosing the right Outsourced IT Partner? Its relative of course, hard to put an exact Euro’s figure on, however as we can see the cost can be significant. And what about the staff development opportunity cost in terms of their lack of opportunity to interact with modern information technology in their daily work and the effect this has on their productivity and motivation which, no doubt, also has an impact on staff retention and turnover? The costs of not having an appropriate modern information technology system supporting your staff and your business goals is huge. SME’s need to be working with the right Outsourced IT Partner to ensure that your most important asset, your people, are not held back in any way when it comes to pursuing your business goals.
How to choose the right Outsourced IT Partner?
When the search for your new Outsourced IT Partner begins in earnest you will quickly whittle the numbers down to three or four realistic options that appear of a suitable reputation, size and quality that are worth being considered. We can now consider and discuss a number of key factors in determining the right Outsourced IT partner for you and your business leading to my top 20 questions for prospective Outsourced IT Partners that will ensure no stone will be left unturned by you in choosing the right one.
What is the right size Outsourced IT Partner?
Having worked with SME’s over the last 20 years and crossed swords with many of my competitors across the strategic groups in the IT Services sector I believe that the ideal Outsourced IT Partner, for an SME with 10 employees and upwards, will have between 10 and 30 employees. If an IT Company is too small they may be limited in the services they can provide. Smaller companies may not yet have the necessary management structures in place, the specialist departments with robust business processes operating and they may not yet be able to attract the right staff that guarantee reliable, consistent and high quality IT Services. Alternatively, if an IT company is too big they may not be able to give you the personal service that your business needs. I’ve seen examples of this over the years as growth hungry IT Companies move their focus from SME to Enterprise leaving swathes of SME customers in their wake receiving less than satisfactory levels of service as their focus shifts away from smaller businesses to higher value corporate clients. As an IT service company it’s difficult to service the SME market and Enterprise market at the same time because they are two very separate markets with differing needs. I’m not bashing the small guys here because I know what it’s like starting small and growing a business and besides we live in different times now. The number of IT service providers out there right now is way greater than it was 20 years ago especially at the smaller size company end.
Is there evidence of growth, progression and success?
The first thing you’ll want to see in a prospective partner is independent evidence of growth, progression and success and, ideally, this evidence might come in the form of recommendations from people that you know. Also, when did they start in business, what has been their growth path in recent years, have they won any industry awards, worked for and earned industry accreditations or received recognition for special achievements?
What is the split between technical staff on the road and service desk?
Your Outsourced IT Partner’s technical staff should be split at least 50:50 between service desk and field engineer. 90% of all IT problems can be resolved remotely and quickly so your Outsourced IT Partner should have a well-resourced service desk able to handle a large volume of calls efficiently.
Your account manager should be a senior person with plenty of experience, often it may be a company director, someone who will give you direction and advice and be there to deal with your questions and issues when they arise.
Evidence of management structure?
Within your ideal Outsourced IT Partner’s company you will also want to see evidence of a management structure. Management roles in areas such as sales management, operations management, service delivery and customer services should be filled with strong capable people. I’d also like to see a summary of experience and qualifications of key staff particularly ones that will deal with your site.
Ask the questions up front!
When you select a new Outsourced IT Partner the time to ask the questions is at the beginning. Once the questions and answers are done, the service level agreement complete and both parties set off on a new relationship then it’s like any other relationship. You have to get used to working together, there may be teething problems along the way, but if both parties are committed to the cause of working together through problems then both will get the best out of each other and reap the rewards of a successful relationship. You will have a great IT Partner and the IT Partner will have a great Customer and that’s the result we’re all looking for at the end of the day!
Top 20 questions that will leave no stone unturned!
So to help you choose the right Outsourced IT Partner I’m going to give you my top 20 questions, with some pointers, that will leave no stone unturned as you search for the right Outsourced IT Partner. These are the questions that I would ask prospective IT Partners. And remember you’re not just interviewing for someone to fix your computer you are looking for an Outsourced IT Partner, a company with people and processes that you trust to deliver the suite of services that you need to ensure that your business stays modern and is delivering value as you focus on pursuing your business goals. Of course it’s highly unlikely that you will invite these people to your office and put them through the grinder in a 2 hour interview. You certainly could do that if you wanted to and maybe you should. The reality is that much of this information will be gathered through desk research and informally from a variety of sources, web, sales documentation, referral and any remaining questions can be asked directly via email, over the phone and during that face to face meeting.
Good luck with your search!
TOP 20 QUESTIONS FOR PROSPECTIVE NEW OUTSOURCED IT PARTNERS!
1. What is the size of your company?
• Who owns the company?
• What is your company’s turnover?
• Who is your target market, SME or Enterprise?
• How many full time employees do you have?
• How many technical staff do you have?
• How many mobile field engineers do you have?
• How many service desk / helpdesk staff do you have?
2. What geographic regions do you cover?
• Where are your field engineers located?
• Where are your offices?
• Where is your HQ?
3. What kind of IT Support contracts do you offer?
• Pay as you go? Fixed price? Variable?
• Service Level Agreement which includes service desk and time on site? Fixed price, no risk.
• Or a combination of service desk and on site time billable? Variable cost, risk of higher bills.
• Regular onsite helpdesk visits? Bulk regular time on site?
• Managed services, where the provider proactively manages all aspects of your IT
4. What are your guaranteed response times?
• Is this a fix time or a response time?
• How quickly will you respond to a priority 1 call, 2 and 3…?
• What is your guaranteed on site response time?
• How does your service desk manage call priorities?
5. Who would be my dedicated account manager?
• Ask to see a summary of their experience and qualifications.
• How often will my account manager be in contact with me?
6. Who would be my dedicated engineer?
• Ask to see a summary of their experience and qualifications.
7. What standards are your technical staff trained to?
• What in-house training do your technical staff receive?
• What are minimum standard of technical qualifications for technical staff?
8. Who are your industry partners?
• What brands of hardware do you sell?
• What types of software do you sell?
• Who are the key partners you have accreditations with?
• Can I see copies of these accreditations / can you confirm they are current?
9. Do you have a detailed written process for logging and managing calls, cradle to grave?
• Ask to see this process.
• What call management system does your company use?
• Will I receive an email notification every time my company logs a call?
• Explain your call escalation process? Who do I contact when I have a problem that needs escalating?
10. If I change provider what steps will your company take to ensure that your company knows my systems inside out and will these steps be at your cost and not mine?
• Will your company do a site survey and document my site properly
• Who will be responsible for updating this documentation?
• Will the engineer attending my site be given time to familiarise himself in advance?
• Will I receive a copy of my site documentation?
11. What services can your company offer my business?
• Do you sell /support phone systems?
• Do you sell hardware/software?
• Do you do software development?
• Do you sell cloud services?
• Telecommunications services?
12. Does your Company do remote IT monitoring?
• What exactly do you monitor?
• Is this included in a support contract?
13. Will your company manage and monitor my backups?
• What is your company’s policy on backups and responsibility for data loss?
• How will you know when my backups have failed?
• How quickly will the problem by fixed?
• What priority does your company give to a backup problem, Priority 1?
• What is your approach to IT disaster recovery?
14. Are there any surprises in your IT Support contracts?
• What do your contracts cover?
• What do your contracts not cover?
15. Reporting: What regular reports will I receive from your company?
• Will I receive reports from engineers when they attend site?
• Will I receive reports about my companies call history?
• Will I receive regular reports about the health of my IT system?
• Will I receive regular reports about my backups?
• Will I receive a monthly statement of account?
16. What are your terms and conditions?
• Can I see a copy of general your terms and conditions?
• Can I see a sample copy of your service level agreement?
• What is your contract cancellation policy?
17. What will you charge me for over and above the contract fee?
• Service requests resolved remotely?
• Short administrative tasks resolved quickly?
• Password changes?
• Will you always tell me in advance if something is billable or not?
18. Can I pay for my IT contract monthly, quarterly, annually?
19. What happens if I want to cancel the contract and move to another provider?
• What is the notice period?
• Will the handover to a new provider be smooth?
• Will there be any issues with key username and passwords being handed over to me or a new IT provider?
20. Do you offer discounts?
• I want to extend the contract over 2 or 3 years will I get a discount?
• If I want more bulk engineer time on site will I get better rates?
• What is the hourly engineer rate for installation or service request work on site?
• What is the rate for remote engineer work for installation or service request?