A recent Gartner survey found that 42% of companies with a thousand employees or less had either fully or partially outsourced their data centers, while 28% are planning to do so within the next 12 months.
According to Kurt Potter, Research Director at Gartner, Inc, there are two reasons to consider outsourcing a data center: You either don’t have and/or can’t afford the skills to deliver the services your business needs to function or your internal IT operations are not cost-competitive.
But a data center outsourcing survey by Enterprise Systems (esj.com) and SOURCINGmag.com found the answers to why companies choose to outsource their data centers are more complex. What follows is the top 7 reasons companies choose to outsource their data center functions:
1) Reduce or Control Costs. The primary reason (44% of respondents) to outsource data center functions is probably no surprise: to reduce or control costs. Colocation and dedicated server hosting are “Cap-Ex” free alternatives that can eliminate large-scale data center investments. Colocation enables CIOs to expand their data center footprint only on an as-needed basis rather than invest in an entire expansion up front.
2) Gain Access to Outside IT Resources. The second most compelling reason companies are outsourcing their data centers is the ability to leverage the people, processes and equipment that aren’t available internally. CIOs can get access to very experienced data center staff that are shared across a “multi-tenant” data center environment without needing to hire their own full time experts in networking, security, cooling, power and data center services.
3) Free Up Internal Resources. Over three out of 10 respondents said they outsource their data center functions to free internal resources. By reducing the day-to-day maintenance chores, the in house IT team can concentrate on core applications and deliverables and leave the day-to-day data center operations to the colocation or dedicated server hosting operator.
4) Improve Customer Focus. Another 3 out of 10 respondents outsourced data center functions to improve business or customer focus. It can be hard to keep in house staff motivated to service other departments. With competing requirements and many demands, responsiveness can be impacted. Outsourced data center operators are in the service business. They keep their customers by being responsive and accurate, and realize that poor service can hinder their business and profitability.
5) Accelerate Company Transformation is a reason for outsourcing any number of functions. Outsourcing non-critical functions can help keep the organization focused on critical roles during time of transformation.
6) Accelerate Data Center Projects. According to an article in SearchCIO, once you determine how serious or urgent your data center problems are, quick fixes in critical areas like uptime, availability and cost efficiencies can be achieved within months via outsourcing versus an internal build out that can take years.
7) Access Outside Management Expertise. The ability to leverage management expertise not available internally rounds out the top 7 reasons companies outsource their data centers. Managed data center management teams are focused day-in and day-out on delivering data center capabilities to their clients efficiently and with a high level of service. By managing multiple large data centers, they can apply industry best practices that are difficult or expensive for individual companies to apply to their own internal data centers.
Finally, with all of the talk and news about offshore outsourcing, you may be surprised to learn that fully 80% of the survey respondents outsourced their data centers to service providers located in the United States. Most companies prefer to keeping the business domestic, in many cases in the same time zone and in close proximity to their core business.
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