Whether you're the CIO or the person in charge of changing the toner in laser printers, at some point in your career you'll likely address the question of whether to outsource your corporate data center, network, desktop support, application or project. When it makes sense for a company to pursue that avenue, and word comes down from IT management that outsourcing is in your future, then you'll need to know what it takes to manage a successful outsource contract.

Bear in mind, however, that if you manage the servers and applications at a small to midsized business, the traditional outsource vendors will turn you away, because they're simply not interested in competing for smaller contracts. If you have the good luck to be a network manager at a Fortune 1,000 firm, outsourcing vendors will doubtless be courting you in droves. According to a recent Forrester Research study, the average company spends 25 percent of its IT budget on external service providers, and yet 64 percent of respondents stated that they do not dedicate a person to manage these relationships.

Furthermore, the telco and ISP communities, while more entrepreneurial, have enough to occupy them as they chase opportunities to provide bandwidth for converged voice, video and Internet traffic. Any attempt to address the server marketplace is limited to the natural extension to Web hosting: co-location, the practice of bundling your servers and firewalls, and renting rack space and bandwidth from the ISP or another carrier's facility. Unfortunately, not all of your current servers will be Internet-based; in fact, most are client/server-based and organized around particular vertical applications, such as human resources or customer service.

For our purposes, we will ignore the concepts of application development or project outsourcing, which properly involve development and management concerns, and concentrate instead on the technology and infrastructure concerns inherent in the outsourcing of network services, desktop support or the corporate data center.

Reasons to Outsource
We define network services as voice, data and video pipes from one site to another--no servers, no applications. In this arena, there's little value-add or site-specificity; the economy of scale, in terms of purchasing power and amortization of management systems and operational staff, is too great. Frankly, it's just a matter of time before one of the network outsource vendors clicks with management and sells them the service contract.

The rewards of this type of outsourcing are easily identified. For example, MCI recently announced a service-level agreement that states that for a single network outage of less than an hour, the client gets a 50 percent discount on that month's bill. For a network outage of more than an hour, the client gets the month's service free.

The second most attractive target for outsource vendors is desktop support. This can be expensive, so if desktop support isn't a core competence, the company may seek to outsource it.

Successful desktop outsource contracts divide desktop support into three areas:

· The helpdesk, which is typically housed off-site and staffed by the outsource vendor's employees, who field trouble calls centrally for a number of clients;

· Adds, moves and changes in workload. As individuals join, leave and reposition within the company, their desktop environments change. The outsource vendor typically handles this workload by providing an on-site support staff that is employed by the vendor but maintains an ongoing presence within the client organization;

· Upgrades and installs. Workload spikes, such as the opening of a facility, can be eased when upgrades and installations are outsourced. Some outsourcing solutions upgrade systems for a fixed price per seat per year, thereby insulating the organization from changes in the technology life cycle.