6 Reasons Why You Can’t Use A Services Grid To Make All Your IT Outsourcing Decisions

I’ve been on the buyer side of the information technology (IT) outsourcing equation, so I know how it works. The majority of the time, companies reduce selection criteria to a commoditized IT services grid. In such a grid, services are put along one axis and potential vendors along the other. Services are checked off, and the vendor with the most checks (and the best price) wins.

The assumption, of course, is that packaged or pre-defined services are all that matter. Unfortunately, falling prey to “gridlock” often means that a company has missed out on discussing other important aspects of an IT solution … aspects that cannot be neatly docketed in a services grid. This omission often results in bad customer/provider relationships – relationships that typically get worse through the term of the service contract.

It is certainly acceptable to have a service grid as one category for selection, but you also need to weigh other criteria off that grid. Here are six criteria that are often missed entirely, touched on only in passing, or not weighted properly when choosing an IT service provider:

1. Security and Compliance Requirements Many IT service providers support a customer’s security compliance through service bundles that provide various components. For example, Payment Card Industry (PCI) compliance requires a number of specific security components including Intrusion Detection Systems (IDS) and Intrusion Prevention Systems (IPS), file integrity, firewalls and demilitarized zones (DMZs), Incident Response policies, anti-virus, etc. An IT service provider might offer all or some of these. You should know exactly what you require from a security and compliance standpoint, and ensure that the IT service provider can comply.

2. IT Service Integration In today’s business world, IT service integration is a requirement for a company to remain competitive. Basic Information Technology Infrastructure Library (ITIL) functions require service provider integration and automation to reduce errors and deliver services “on-demand” in an effective, secure manner.

3. Technology Flexibility What new technology paths are being explored by the IT service provider? That Virtual Desktop Infrastructure (VDI) deployment you are planning for 2016 as part of a re-organization – will it readily integrate with the provider’s current Vblock and VMware Site Recovery Manager environment? What might change for your company in 2016/2017 and how would that effect a three-year Service Agreement signed in 2015? You need to share your planning process with a prospective IT service provider: discussions in the present will reveal whether the IT service provider is positioned to be agile and collaborative in the future.

4. Integration with Third Parties, IT Equipment, and Software The service provider may be required to work with multiple vendors across geographies within the parameters of IT operation schedules, software releases, and appropriate interfaces – all the while maintaining the use of best practices. This is not any easy task and is worth serious consideration by the customer and the IT service provider.

5. Strategic Partner vs. Order Taker How diverse and tactical are your IT initiatives, and what value do you need from your service provider to support them? Do you want a true partner for the effective management of IT services to enable your business strategies, or do you want an order taker? Either approach may be appropriate, depending on your needs. An IT service provider partner can assist you in clarifying business strategies, plus play a critical supportive role in helping you to achieve them.

6. IT Governance If you outsource IT, it is critical that both you and the service provider form a partnership and governance framework in support of your business strategies. A governance framework ensures the appropriate decision rights and accountability of both parties; it determines who makes and contributes to specific IT decisions in support of your corporate principles and performance goals. IT governance keeps everyone on the same page!

You may have noticed that I did not list service level agreements (SLAs), pricing structures, technical support, data center tiers, onshore/offshore reporting, and many other selection criteria categories. That is because I have found that these areas are covered well in almost every review and request for proposal (RFP) I have been involved in. It is the 6 criteria areas listed above that are too frequently lacking, and which require intentional scrutiny during any IT service provider selection process to enable a long-term successful relationship between customer and service provider.

Checkmarks are only part of a healthy IT outsourcing process. Don’t get caught in gridlock!

This article was originally published on SungardAS