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Outsourcing Your IT Department: What You Need to Know Before Choosing an IT Provider

You have made the decision to hire an outsourced IT company, so where do you start? The first thing you need to understand is why. What are the current pain points you’re seeing in your network today? Is your server room outdated? Dealing with countless hours of downtime? Are your employees complaining that their computers are slow and they can’t get their work done? Is your business growing faster than your technology can handle? There can literally be hundreds of reasons you might need help, but it is important to narrow down what your main pain points are. From there you will have a great starting ground of what type of provider to look for based upon their area of expertise and knowledge they can bring to the table.

The Basics

Every business should receive minimum standards from their IT department, whether they are in-house or outsourced to a provider. Make sure your IT department provides your business with the following:

Back-Up and Disaster Recovery

Otherwise known as BDR in the industry, a true back-up and disaster recover system ensures your entire network is not only properly backed-up but also recoverable in the amount of time that is acceptable to you. Many providers will undercut prices and offer a standard data back-up system, external hard drive, or mirrored server. These DO NOT constitute true disaster recovery systems. Time and time again, business have lost their data due to human error, theft or disasters, only to find out their data is not recoverable or is going to take 1-2 weeks to recover and rebuild. For many businesses that equates to thousands, if not hundreds of thousands of dollars in downtime.

A true BDR system should consist of a server (usually owned by your IT provider) with special software that continuously takes snapshots of your entire network’s operating system, not just the data. This BDR server also acts as a spare server so if one or more of your servers goes down, your IT company can “virtualize” or run that failed server on the BDR or spare server. This is the basic level of redundancy and there is no need to reinstall anything or load any data. It usually takes anywhere from 15-30 minutes and you’re back in business. In the meantime they can fix the issue with your main server and move the full image back to your server seamlessly.

What if all of your servers are gone, stolen, destroyed? True BDR systems also provide offsite encrypted image storage of your servers in state of the art and military grade datacenters in different geographies. So in a total loss situation, your provider will have a pan to procure new servers, download the last image of your servers, and get you back in business. Some providers even have the capability to run the images directly from the datacenter for a period of time and have all of your employees access it remotely. See Cloud Computing to learn more about working remotely. So be sure your provider’s back-up solution is a true BDR system, not just data back-up. It can save you tremendously in the event of a server failure.

Server/Desktop Monitoring and Protection

Almost every provider will insert something that sounds like this in their sales pitch; “we monitor your network 24/7 and know something is about to go wrong and will fix it before it does”. The reality is less than half of them actually follow through with this. Choose a provider who uses true business class network monitoring software such as Kaseya, LabTech, Level Platforms, Continuum, and a handful of others. Then ask them how effectively they are using the tools. Do they automate computer maintenance and updates to keep your employees running smooth? Do they truly monitor your servers and provide you monthly reports on the performance and any potential problems? Who is monitoring any alerts? They may have an oversees office to notify them if an alert is happening on your server in the middle of the night, and that is fine but make sure all they are able to see is alerts and they have no access to your server.

Your IT provider should also provide you with anti-virus and anti-malware on all of your computers and servers, as well as spam filtering for e-mails. They should have the ability to remote directly into any of your machines to fix problems without having to have your employees do anything. Just be sure that the provider you choose is using a legitimate remote monitoring and management tool, without this they are equivalent to a mechanic trying to repair a car with gardening tools.

Trouble Ticketing System and Helpdesk

Odds are you probably don’t have a trouble ticket system for your employees to log issues they need help with, but if you’re going to outsource your IT, it is a must. The only way to keep your IT department accountable is by using a track able system that shows every issue your network and users are having, how quickly they respond to it, and how they fixed the issue. This ensures they live up to their end of the bargain, and helps the provider grow a knowledge base that all of their techs can learn from, continuously improving service for your network.

As the business owner or department head, you can choose to be included or cc’d on every trouble ticket your employees open, or you can ask for a monthly report of cumulative tickets and response times. Most providers allow users to call the support line, or even create a ticket directly from an e-mail. The user is then kept up to date on the resolution process and time so they can multi-task while their computer or printer is being worked on for example. Here is a tip when choosing a vendor, call their support line and see how you’re treated. The IT companies we approve treat each caller is if their mother is calling for help!

Industry Expertise

Depending on what industry you are in, it can be very advantageous for your IT provider to have expertise in your line of business. A great IT department understands how your business operates, what generates revenues, and what challenges you might face in delivering your products or services.

For example, let’s say you are in the print packaging industry and operate large printing equipment, have a graphics department, and involve a lot of collaboration between your customers. Hiring an IT department that understands exactly what your ERP does, how you order raw materials, how your team communicates with customers, and how your customers find you, the odds of them being able to bring valuable resources to the table increase dramatically. Do they have experience with other companies using similar ERP systems? Do they know the best practices to manage the movement of large files and images through your network? If they are familiar with your industry and have similar accounts to yours, your odds of satisfactions skyrocket.

On the contrary, if you hire an IT company that really only has experience with medical offices, they are going to have a much higher learning curve understanding your business and workflows, and the important tools your staff uses to generate revenue. Picking a provider that knows your market and understands how your business processes work is worth their weight in gold, they hold many keys to increasing your production in the long run.

Research and Development

One of the reasons many companies choose to outsource their IT departments is because outside vendors can bring fresh ideas, new solutions, and revenue generating tools that many in-house IT departments simply don’t know about. The reason for this is because internal IT departments usually consist of just a few people that work in the business, not on the business. They usually don’t have exposure to many different situations and technologies.

If you pick the right IT provider, they should be able to bring solutions to your attention that you may incorporate in your IT roadmap. Your internal IT department, if you actually have one, is most likely not traveling to IT trade conventions, keeping current on their certifications, and probably not seeing what is going on in similar business networks. Providers also bring a diverse mix of professionals to your disposal, each with their own expertise and ideas. This can be a huge advantage to internal IT departments as you may only be able to afford 1 or 2 people, but a provider may have a dozen or more technicians you can leverage. When searching for a provider, ask them how often they send their engineers for training, industry trade events, and if they have staff dedicated to R&D.

Transparency and Planning

The last thing you want to do is put all your company’s network information in the hands of a single person. Many “IT Guys” have left businesses in a mess when they decide to suddenly leave or are fired. Trying to work retro-actively and recover network passwords, software keys, licensing information, and data back-up procedures can be a nightmare.

Leading IT providers will build an IT Handbook for your business to not only ensure full transparency if something were to happen, but also document proactive plans for enhancements and recommendations to your network. The handbook should include:

Network Diagrams: A network diagram ensures you understand the basics of how your network is architected and enables any new engineer to quickly understand the layout of your business network without having to spend weeks mapping everything.

Hardware Inventory: List of all servers, switches, workstations, licensing, and warranty information.

Passwords and Policies: All administrative passwords in case of an emergency or provider change. Depicts policies for password changes and recovery.

Security Reports: tests that prove that your network protection services are in place and your data is not compromised.

Disaster Recovery Plan: How is data currently backed-up and replicated, how is it being tested and monitored, and what are the plans in case of hardware failure, disaster, or theft. The recovery times should be tested and in-line with your tolerances.

Another important service your IT provider should offer are QBR’s, or quarterly business reviews. As a business executive you probably won’t have time to monitor all of the ticket activity and network reports your provider will send you. If you don’t hear any complaints from your staff you’ll just assume everything is running smooth.

Your provider will usually assign a head technician responsible for your network who will attend these QBR’s along with a sales engineer or the owner of the firm. The agenda for these meetings is to report the health of your network, any challenges you may be having and potential remedies, and discuss your business climate and plan for what changes may be occurring on the future. An IT roadmap should always be planned to accommodate for technology lifecycles and upgrades. The provider uses these QBR’s to make adjustments to your IT roadmap and research any solutions that may enhance your network or positively affect business outcomes.

Cost Model

We’ve saved the most important for last. Everything we have discussed above is generally reflected in the way your provider charges you for their services. Over the years there have been many different ways an IT provider bills his customers, and like the old saying goes you can always find a person’s intent by the way they are paid. Let’s cover a few of the common cost models you will find.

Break/Fix

The break fix model has been around since computers were introduced to the workplace and still used today. More common amongst the smaller IT providers, this billing method usually consists of a loose service agreement with little to no monthly retainer. When you have an issue in your network or when a user needs help, the provider bills you for any work completed. You basically get billed for every hour an engineer has worked on your systems or computers, meaning you only pay for the service you need. This can appear to be the cheapest way to go, since many business owners feel they don’t really need IT support when things are running smooth. In many cases though this can prove to be costly mistake in the long run. These types of providers don’t get compensated when your network is up, they make their money when you’re having issues or downtime. Your network up time is not necessarily in your provider’s best interest. There is also no sense of urgency to resolve problems quickly since the clock is ticking when they come to your office or work on your network remotely. Although you may think you’re getting the best priced services the end result is more downtime, loss in productivity, and no guarantees that your provider is looking out for you. What you may save upfront, you’ll lose in the case of an emergency in a matter of days.

Block Hours

Block hours are basically a pre-paid version of break fix. Your provider estimates the number of hours it will take to properly manage your network and sells you an agreement with a schedule of on-site visits and remote support. They might sell this as a “flat-fee” IT but still don’t have complete accountability to your network performance or up time. Engineers are paid on billable time so they will come to your office and spend their allotted time, even if they may not really have anything to do. You get that warm and fuzzy feeling seeing the IT guy every week but he might just be billing out his hours instead of solving the root of any issues. Remember that a provider with the right tools and engineers should be able to do 90% of their work remotely.

Managed IT Services

By far the most effective model of billing for both the provider and the client is the true flat monthly fee, or managed services method. A provider will usually audit your network and figure out exactly how much work is involved in managing your server, computers, software, backbone, phone system, or any other pieces of your network. The will then propose a flat monthly fee to manage the “whole enchilada”. This method develops a true partnership between your company and the IT provider. Since they take responsibility for your network for a fixed fee, if an issue arises they are motivated to not only fix the problem quickly, but to solve the root of the problem once and for all. The provider now wants to make sure your network is properly managed so that less support is needed from them in the long run. If they do their job right, your business network is purring like a kitten, your employees are happy and productive, and both you and the provider are increasing profits. If they drop the ball, they send out their engineers and will do whatever it takes to fix the problem swiftly and minimize their internal billable time. Good network engineers are not cheap, so the more efficient they can be the more profitable they are. Their contracts are usually well defined and provide a very clear understanding on what is covered. Any special requirements like installing new servers or upgrading your network are usually spelled out and a discounted hourly rate is agreed upon. These type of agreement are usually 2-3yr terms but have an SLA (Service Level Agreement) that will guarantee certain levels of response times and satisfaction or the agreement is voided. Although true Managed IT Service agreements might cost a little more per month, the savings in reliability, up time, and productivity pay you back 10 fold. Plus you are able to develop a long-term relationship with a true IT department that is looking out for you and truly has the same goals for your business as you do.

Well if you have made it this far, congratulations! You probably know more about choosing the best outsourced IT provider than 95% of business owners in the world. Our goal is for you to align your business with the best technologies and resources to promote business growth. The next time you plan on hiring an IT professional or IT management company, be sure to look out for the points we’ve covered. When you’re ready to begin searching for the right outsourcing firms for your company, visit our search tool to find Tech Adviser Approved vendors that are best suited to serve your needs.

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