Five key considerations to evaluate when outsourcing during the Cloud Era

Outsourcing is an important component of an organizations evolving service delivery model, used to enhance company capabilities and allow IT to support operations and enable both business and citizen services.

Since its inception, this model has been evolving. It started with companies like EDS outsourcing entire organizations IT Operations to the move to multi-sourcing – working with multiple alternate service delivery partners for different “swim lanes” such as desktop, data centre, network, service desk, etc. We have witnessed significant changes but none more profound than the disruption cloud computing brings.

Digital transformation will never be seamless but combining best practices with outsourcing can produce great results.

Companies like Uber and Airbnb have disrupted via the digital business model. That disruption is far reaching and includes the business model for IT Operations, including how organizations design their own operations models, shared services and which components they elect to outsource.

Five key things to consider when looking at how Cloud Economics impacts IT Outsourcing:

  1. Viewpoint – Traditionally IT Operations was seen from an infrastructure lens of what it supported (i.e. physical servers or virtual machines). While infrastructure has a place in a hybrid model, that primary focus now shifts to the end application or solutions being provided.
  2. Costs – Infrastructure-as-a-Service (IaaS) decreases costs at the time of move and on an ongoing basis as the environment is continually optimized for the cloud. This causes a shift from Capital to Operating Expense models.
  3. Capabilities – Freeing up spend as well as combining the data with new cloud platform capabilities creates new opportunities to invest in business enablement and innovation of differentiating capabilities. Plan for it.
  4. Solutions – How we think about solutions changes from standalone customized to standardized cloud-based frameworks built upon and aggregating different cloud platforms.
  5. Operations – The requirements and responsibilities of managing IT Operations changes to reflect the new design of these environments.

Enabling our customers and partners

Our mission at Microsoft is to empower every person and every organization on the planet to achieve more. The Cloud Era of IT Outsourcing is key to enabling the full benefits of our cloud services.

Our Enterprise Services and Partner teams are working with the rest of Microsoft, our customers and partners to make this a reality. This includes helping our customers define the right strategy and model for their new environment as well as how to transition. We are doing this in partnership with our key partners including enabling our traditional strategic outsourcers to transform their models as well as assisting the development of new cloud managed service providers.