IT Manager's Handbook: Getting Your New Job Done (45 page)
Read IT Manager's Handbook: Getting Your New Job Done Online
Authors: Bill Holtsnider,Brian D. Jaffe
Tags: #Business & Economics, #Information Management, #Computers, #Information Technology, #Enterprise Applications, #General, #Databases, #Networking
Take a look at how different business areas are interacting. Is there sufficient collaboration and sharing of information? Are the Engineering and Research and Development teams aware of the complaints coming in on the support lines? IT can help implement tools and solutions to help ensure that people have access to the information that they need and that different areas aren't duplicating each other's work because everyone is operating in a “siloed” (isolated) fashion.
Solutions here probably won't be free. However, if you can show clear value by either reducing costs or helping the business gain/retain business and customers, management will be more than happy to make an investment now for a payoff to come. However, during tough times, management will probably want to see that payoff coming as soon as possible, not in five years.
Demonstrating Leadership
Often IT is looked at as a cost center and a rather expensive cost center at that. Having a reputation like that during tough times can hurt you and your department, which will in turn end up severely hurting the business. As the IT Manager, you want to be sure that your department's value is recognized by management and the rest of the company. Make it clear that IT is fully aware of the difficult times the organization is going through and is fully involved by making sacrifices, proactively suggesting changes, and helping other departments achieve their goal and cut costs.
Your leadership (discussed in the section
“Leadership vs. Management”
on
page 13
in
Chapter 1, The Role of an IT Manager
) is more important when the going gets tough than it is during times of growth. Your company's management and business leads will be looking to you for cost cutting and for new solutions to help drive the business. Show them that you are proactive and creating opportunities, that you're coming to the table with ideas, and that you are adjusting priorities properly. Where possible, investigate how your competitors are doing during these times and what steps they are taking. Stay on top of what's going on by reading more than IT journals. Be aware of what's going on in your company's industry and the business world in general. You need to know how different events affect the economy, your company, your department, and your job.
At the same time, your team will be looking to you for guidance. They'll be nervous and uncertain and will look to you for your calm (at the very moment that you're trying to hide your own sense of uncertainty, of course). These are great times to increase your visibility to your team and the department. Be open and honest with communications, acknowledge that things are tough, but also talk about the steps the company is taking and the ideas being considered. You won't completely eliminate your employees' nervousness, but if they feel fully informed, you can certainly mitigate it to a great extent. Nothing helps reduce panic more than showing that you're aware, concerned, and taking action.
Finally, solicit feedback from everyone—your team, your peers, your management, and your suppliers and vendors, as well as colleagues at other companies.
6.7 Outsourcing and Offshoring
Managing your staff and your resources is a major task of an IT Manager. Outsourcing in all of its forms can be a very effective tool for helping you accomplish that task. But as you can imagine, outsourcing is not without its own associated costs (see
Table 6.2
for definitions).
Table 6.2.
Outsourcing Definitions
| Term | Definition |
| Outsourcing | When one company makes an agreement with a second company to provide services that the first could provide, but chooses not to. IT companies often outsource portions of their software development, for example. They might do this for various reasons (see the discussion later in this chapter), but the important point is that they could perform that task if they chose to. Using a third party to perform a task your company doesn't normally do—say you develop software but you need your new offices wired for electricity, so you hire an electrical contractor—is not outsourcing. |
| Offshore outsourcing | Arranging with a second company to provide services that the first company could provide but chose not to—and the second company isn't located in your own country. |
| | A common example of offshore outsourcing is a company in, say, Redmond, Washington, USA, contracting with another company in, say, Bangalore, India, to help it with its software development or customer support. |
There are many tasks that you and your department perform. There are some that you perform because you
have
to, but you would gladly assign them to someone else given the opportunity. Perhaps doing these tasks chews up valuable skilled resources that you could use better somewhere else, perhaps your department doesn't do them well because they fall outside your core competencies, or perhaps no one likes doing them for other reasons.
Companies outsource a wide range of tasks; some send their Help Desk departments or their entire application development and maintenance. Others may use third-party services for their data center or to monitor the network.
One way to think about outsourcing is to think of one company with one kind of expertise—developing software, for example—hooking up with a company that has a different kind of expertise, such as accounting. Could the first company build its own billing system if it wanted? Yes. But it might be less expensive, get better results, and have fewer headaches if it contracted to have another company do it.
There are entire companies dedicated to the process of helping you outsource your tasks.
Offshore Outsourcing Overview
Sending work overseas is a much more drastic method of outsourcing—“drastic” both in a good and in a bad sense. We'll outline the positives and negatives of doing this (see
Table 6.3
), but keep in mind that offshore outsourcing is a
very
controversial idea. The decision whether to contract with an offshore company (some people would call that “sending local jobs overseas”) isn't likely to be made entirely at the IT level, but here are some things to think about if you are called in and asked for your recommendations.
Table 6.3.
Pros and Cons of Offshore Outsourcing
| Pro | Con |
| Many of the tasks that Americans have traditionally performed, especially in IT, can be done for less money in other countries. Americans have a high standard of living compared to the rest of the world, and programmers overseas aren't paid at near the same rate. This is also true for Help Desk workers, data center employees, and software testers (among others). | The first negative is morale: If word gets out that you are replacing local jobs with overseas work, there will be significant employee issues to be dealt with. Among the public, not everyone agrees that globalization is inevitable and that the march of jobs to the lowest paying corporation (wherever they may be) is the most efficient, let alone the most moral, course to take. Many companies now go out of their way to hide their offshore outsourcing agreements. |
| In addition to cost, another often-cited benefit of outsourcing work overseas (to India and Russia in particular) is that your company gets the benefit of a 24-hour work cycle. Once your Help Desk is finished with their workday in the United States, for example, they can then send calls to the second company located in India or Russia. Since these countries are virtually on the other side of the world, their workday is only beginning. This allows calls to be answered, open tickets investigated, etc., around the clock. | The overhead costs involved in establishing a smooth relationship overseas are significant. It still may eventually be worth your company's while to do this, but there will be a steep cost curve at first. |
| It's common now: By 2015, 3.3 million jobs will have been sent overseas, according to Forrester Research. As the offshoring trend matures, U.S. firms will contract out increasing amounts of white-collar work such as accounting, drug research, and technical R&D. | There will be cultural considerations. While many IT workers overseas speak English, for example, and although many are trained in the United States, many workers are not. Different cultures have different laws about hiring, about contracting workers, different holiday schedules, etc. There will be some learning involved before both companies are comfortable with the arrangement and working together effectively. With the focus on security and compliance issues (see Compliance and IT in Chapter 8, page 226 ), many companies have concerns about exposing sensitive data to third parties in another country. |
Outsourcing and offshoring can be very challenging, and while it can save money, companies have to be careful about what it means to the quality of work and impact on customers and operations. In a 2007 global outsourcing survey by KPMG LLC, 60 percent of the respondents said that problems with outsourcing are related to people. In 2005, Sears, Roebuck and Co. ended a $1.6 billion/10-year outsourcing agreement it had signed with CSC Corporation just a year earlier for “failure to perform certain of its obligations” (
www.computerworld.com/industrytopics/retail/story/0,10801,101774,00.html
). J.P. Morgan Chase & Co. abruptly canceled a $5 billion outsourcing arrangement with IBM Corp. Dell decided to return to U.S.-based call centers for its corporate customers when it was deluged with complaints after shifting its support operations to India (
http://www.techedgeezine.com/112603_dells_service_dehli.htm
). The list goes on and on.
Which Functions to Outsource
At some point, your organization is likely to ask you to consider outsourcing. One of the first steps is to consider which function(s) in your department is a candidate for outsourcing. While outsourcers will tell you that they can run the entire IT department, that might be too big of a first step. An easy way to dip your toe into the outsourcing waters is to first try functions that require minimal, or absolutely no, knowledge of your company's industry and/or operations.
For example, printer maintenance is something that is often outsourced. Just like you probably have a third party taking care of your copiers, you can have a third party take care of your printers (consumables, maintenance, repairs, monitoring, etc.). After all, a printer is a printer, and the outsourcer and their technicians really don't need to know anything about your company or your business (except where the devices are and who the VIPs are). The same can be said for the routine functions of workstation moves and setups. Other areas to consider outsourcing are shrink-wrapped software support for those how-to questions about Windows, Excel, PowerPoint, etc.
When these functions are outsourced, not only are you freeing up your internal staff for those tasks that require specialized knowledge of your industry and organization, but you may also be delivering a higher level of service, as the outsourcer is well versed in that function. For example, if your existing Help Desk gets a call from a user wanting to know how to do footnotes in Microsoft Word, there's a pretty good chance that your staffer would first do some investigating to figure out how to do footnotes and then walk the user through it. If that call had gone to an outsourcer with a support staff that only does MS Office support, there's a good chance that the user would get a quicker and more comprehensive answer.
More complicated areas for outsourcing are those that require more specialized knowledge of how your company operates or that involve functions that deal with sensitive or confidential areas (e.g., application development, network security, HR or finance data). Not only will it take additional time to outsource these areas (particularly for bringing the outsourcer up to speed), but many companies get nervous about having some of the functions outside of their own control. However, there are still some ways to find reasonable middle grounds. For example, instead of outsourcing network security and operations, perhaps only outsource network monitoring. Instead of outsourcing applications development, perhaps only outsource application maintenance. Some companies would prefer to keep their outsourcing to those items that are behind the scenes, and are less comfortable in outsourcing functions that will have direct interaction with users and customers, such as Help Desk or customer service functions.
Another flavor of outsourcing is when companies “operate in the cloud,” which was briefly mentioned earlier and is discussed further in the section
“Cloud Computing
” on
page 148
of
Chapter 5, Software, Operating Systems, and Enterprise Applications.
Does Outsourcing Make Sense?
Although there are a number of factors to consider when deciding whether to outsource, as a general rule, determining if it makes business sense is the overriding concern.
The Business Consideration
How will outsourcing benefit the company? Will it lead to cost savings? Will it provide better service delivery, perhaps in terms of quicker turnaround or better quality? Will it somehow improve relationships with customers or users? Will outsourcing improve the company's image?
Answering these questions takes some careful evaluation and judgment. As mentioned earlier, many outsourcing deals have been canceled because they didn't yield the expected results. The following steps are key in evaluating an outsourcing agreement: