For a booming business that is rapidly outgrowing its resources, budget and staff capabilities, an outsourcing provider may offer the relief that’s needed to keep things running smoothly. But what considerations need to be made before offloading some — or all — of your business’s computing needs into the cloud? This month, we’ve asked our Advisory Board members to discuss the data center outsourcing used in their own businesses, the strategic goals in mind for outsourcing, the biggest considerations in opting to outsource and select providers, and the major hurdles they have faced.
Companies are seeing the benefit of outsourcing as a tool to expand their data center environment. The ability to have a “pay-as-you-go” model available makes an Infrastructure-as-a-Service (IaaS) environment based in the cloud very feasible. Organizations are seeing that infrastructures or data centers in the cloud offer technological diversity which a local environment may not necessarily have. So, a cloud-based design can fit a number of business models (depending on the organization) including expansion, testing, development or even DR. Outsourcing a part of the data center functionality to a service provider may be a logical IT next step.
In terms of strategic goals, a big push has recently been around offsite disaster recovery (DR) deployments. A great model for this type of project is a cloud-based infrastructure. Organizations are able to deploy the amount of data center components that they need to stay compliant with their DR strategies. The cloud’s scalability really favors the organization since administrators are able to spin up as many machines as they need, when they need them. Where offsite DR used to be an expensive initiative, cloud providers are able to make intricate solutions much more cost effective.
The major considerations revolving around the right provider will usually focus on the type of project. Using the previous example, when going with an offsite backup or DR environment, an organization wants to see a proven track record of up-time and a very solid service-level agreement (SLA). The appropriate feature set being offered in the plan must also be a good fit, depending on the project. Too often managers sign off on contracts which contain infrastructure components that they don't necessarily need. So, when looking and working with an outsourcing provider, find one that is able to be a successful solutions partner capable of understanding the business drivers behind the deployment.
And there are hurdles. For example, improper sizing of a cloud-based initiative is always an issue. When working on an outsourcing project, it's important to conduct thorough planning to fully understand what components are going to be deployed in the IaaS area. Not having enough resources available may mean contract renegotiations with a provider or a full reevaluation of the project at hand. Missed planning steps cost money in the long-term to correct, especially when under- or over-sizing is an issue. Organizations looking to move toward a data center outsourcing project must know what their external infrastructure is capable of and how it will directly interact with their existing environment.
A company's philosophy defines their strategic goals for outsourcing data center activities. For instance, enterprises that prioritize security, availability and customer privacy are more likely to keep data center functions in-house, although they may waver a little in outsourcing overnight operations or machine maintenance. On the other hand, an enterprise with other requirements might go further and possibly outsource its entire operations to another company. It simply comes down to what they're comfortable with and what their requirements are.
While price may be the reason for outsourcing in the first place, there are many other things to consider. For example, security and integrity should be considered, as well as a vendor's design or availability. It will be most important to spell out the roles, responsibilities, service level agreements and penalties for failing to meet them in a good and solid contract.
And there are several hurdles I can think of. First is resistance to outsourcing from within the company. There will also be lots of adjustments to a different way of doing things now that it has to be done through a contract instead of a phone call. The distance and means of communication with the provider may also be an issue if it leaves a customer one cut cable away from losing communication with the data center.
In terms of outsourcing our own operations, we’re still investigating the various options available such as IaaS, DCaaS, cloud and so on. When the time does arrive to outsource, it will be important for us to comply with OMB (Office of Management and Budget) mandates: in effect, do something that makes sense; ensure it's secure and useable.
Although we have not yet had the opportunity to select or engage an outsourcing provider, there are some hurdles that we expect to address in the process — not the least of which involves security (all of its variations and requirements we have in government) as well as the bandwidth required for optimum utilization and reliability.
Matching needs and requirements
There is no single answer to outsourcing: it offers a myriad of different options that can potentially suit the unique needs of almost any business. Our advisors recommend you understand the requirements of your own business, make a solid business case for the most suitable outsourcing vehicle (e.g., IaaS vs DCaaS) and then phase into an outsourcing deployment in a way that can demonstrate value and build confidence in the technology.
This was first published in February 2012