The Outsourcing Continuum, Part II: In-House Managed - Page 2

Mar 5, 2009

Mike Scheuerman

What You Won't Get

You don’t get the security of having your servers sitting in a hardened data center in the event of a disaster. You still have to pay for the power and physical improvements to accommodate the equipment in your office. You still have to negotiate with the communications company to get the appropriate bandwidth for your needs and arrange to have it installed. You’ll still have to buy the hardware and pay for the installation and maintenance. You still have to buy the operating system software and any applications you want to use. You’ll still have to make sure you have someone on staff that has responsibility for managing the relationship with your service provider and making sure that you get what you’re paying for. And, finally, you’ll still be responsible for making sure that the backups of your data and systems are done regularly. Somebody will have to put the tapes in the tape drive and rotate them to off-site storage. You will have to develop, maintain and test a Business Continuity Plan.

What it Costs

The costs for this kind of outsourcing are usually based on the number and type of machines that are being supported. For example, if you have 6 servers, 50 desktops, 20 laptops and a handful of PDAs your costs might look like those in the following table.

As you can see, this is less than the annual cost for a single good network administrator and you get much more value for your dollars. With in-house managed outsourcing, there will still be plenty for your IT staff to do, but they will be focused on adding business value not maintaining the power plant. It also means that you may need to have a different kind of person in ITone who understands your business and how technology enhances and supports that business.

In the next article, we’ll examine more of the details of the co-location outsourcing model.

Mike Scheuerman is an independent consultant with more than 26 years experience in strategic business planning and implementation. His experience from the computer room to the boardroom provides a broad spectrum view of how technology can be integrated with and contributes significantly to business strategy. Mike can be reached at

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