6 Risks of Outsourcing IT

6 Risks of Outsourcing IT

Outsourcing your IT can be an effective solution for the management of your technology environment. Many companies use some sort of outsourced IT provider, whether they are managing the entire network or supporting an in-house team. It’s especially common for small or medium-sized businesses to choose outsourced IT. It can be a great way to save money when compared to hiring in-house. However, outsourcing your IT doesn’t come without risks. Today we are going to discuss the risks of outsourcing IT so you can make an informed decision regarding your company and network. 

What Are The Risks of Outsourcing IT?

Almost everything in life has potential downsides and outsourced IT is no different. By opening your business up to a third party, you risk your business’s data, security, and operations. Most outsourced IT providers are reputable companies that will actually improve your technology environment and provide many benefits. However, if you don’t do proper research before hiring, you could experience the following.

1. Loss of Control

No matter which IT provider you choose, you won’t have as much control over your operations. That’s why you hire an MSP in the first place. Your provider will step in and begin managing the aspects of your environment you have both agreed on. You can take that responsibility off your plate.

However, this can be quite nerve-racking for some business owners. Entrusting core business functions, possibly even security, to a third party can be difficult. What if the third party doesn’t meet your expectations? What if they have an inexperienced staff or don’t know what they are doing? Like any industry, there are low-quality providers out there. That’s why it’s important to do your research before hiring a company. You want to be able to trust the provider you end up choosing completely. 

2. Lack of Communication

Many, if not all, businesses emphasize the importance of communication throughout their organization. It helps everyone stay on the same page, working towards the same goal. And you should expect this same level of communication from your IT provider. But what if that doesn’t happen?

Sometimes providers operate in a different time zone than your business. If this is the case, there may be some delay in communication. Before signing a contract with an MSP in a different time zone, it’s important to understand and discuss this with them. However, any reliable IT provider should still respond within 24 hours at a maximum. They should keep you updated on any changes. They should also ensure you sign off on all decisions, user access permissions, and passwords. 

3. Possibility of Downtime

Some IT providers keep technicians on-call 24/7, while others only work during business hours. If you are working with a company that only operates during certain hours, your business may experience downtime. For example, if the server for your website fails at 7 PM, your IT provider may not get everything back up and running until the next morning. 

This is something you will want to consider when hiring. If your IT company is slow to respond or is not available during holidays or off-hours, are you okay with the possibility of downtime? 

4. Unexpected Costs

There are many different pricing models that IT providers use. One thing to note when comparing pricing is what each contract includes. Some providers include most management tasks in their monthly prices. Others, however, don’t. The monthly price they charge is only the base price, and many jobs will cost extra. If this is the case, you might be in store for unexpected costs or skyrocketing rates. 

For example, a provider might have a policy that any work done during weekends is double your weekly rate. Depending on the provider you choose and how they charge, these unexpected high costs are a risk you run. 

5. Decline in Quality

When working with a third party, there is the possibility of a decline in quality. You hire an outsourced IT provider to improve your technology environment, but some inexperienced providers do worse than you would in-house. This is a significant concern for many businesses because IT affects every branch of a company. Your technology is the thread running through your entire operations. 

Again, with proper research and due diligence, you should be able to avoid this. By talking with a provider’s current clients, you’ll get an idea of whether they are a reliable, high-quality MSP or not. 

6. Increased Internal Friction

Another of the potential risks of outsourcing IT is the possibility of friction within the company culture. If you are using outsourced IT to support your in-house IT department, employees may feel threatened or devalued if not approached correctly. This can lead to low morale and, eventually, turnover. 

It’s important to understand and relay what role the MSP is filling when working with an in-house team. Are they working as a gap-filler, tackling daily helpdesk tasks? Or are they working in more of a CTO capacity — creating strategy and working on large-scale technology solutions? If this is not clear, your employees won’t see outsourced IT as what it is meant to be — a helping hand. 

In Conclusion

There are many benefits of outsourcing your IT. It can help reduce spend, improve efficiency, and give you more time to focus on your core competency. However, when evaluating any business decision, it’s also important to understand the risks. You can mitigate many of the risks of outsourcing IT by doing proper research and hiring a high-quality MSP. Using these factors, you can know what to look for when evaluating various companies.