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- Management Reference Guide
- Table of Contents
- Introduction
- Strategic Management
- Establishing Goals, Objectives, and Strategies
- Aligning IT Goals with Corporate Business Goals
- Utilizing Effective Planning Techniques
- Developing Worthwhile Mission Statements
- Developing Worthwhile Vision Statements
- Instituting Practical Corporate Values
- Budgeting Considerations in an IT Environment
- Introduction to Conducting an Effective SWOT Analysis
- IT Governance and Disaster Recovery, Part One
- IT Governance and Disaster Recovery, Part Two
- Customer Management
- Identifying Key External Customers
- Identifying Key Internal Customers
- Negotiating with Customers and Suppliers—Part 1: An Introduction
- Negotiating With Customers and Suppliers—Part 2: Reaching Agreement
- Negotiating and Managing Realistic Customer Expectations
- Service Management
- Identifying Key Services for Business Users
- Service-Level Agreements That Really Work
- How IT Evolved into a Service Organization
- FAQs About Systems Management (SM)
- FAQs About Availability (AV)
- FAQs About Performance and Tuning (PT)
- FAQs About Service Desk (SD)
- FAQs About Change Management (CM)
- FAQs About Configuration Management (CF)
- FAQs About Capacity Planning (CP)
- FAQs About Network Management
- FAQs About Storage Management (SM)
- FAQs About Production Acceptance (PA)
- FAQs About Release Management (RM)
- FAQs About Disaster Recovery (DR)
- FAQs About Business Continuity (BC)
- FAQs About Security (SE)
- FAQs About Service Level Management (SL)
- FAQs About Financial Management (FN)
- FAQs About Problem Management (PM)
- FAQs About Facilities Management (FM)
- Process Management
- Developing Robust Processes
- Establishing Mutually Beneficial Process Metrics
- Change Management—Part 1
- Change Management—Part 2
- Change Management—Part 3
- Audit Reconnaissance: Releasing Resources Through the IT Audit
- Problem Management
- Problem Management–Part 2: Process Design
- Problem Management–Part 3: Process Implementation
- Business Continuity Emergency Communications Plan
- Capacity Planning – Part One: Why It is Seldom Done Well
- Capacity Planning – Part Two: Developing a Capacity Planning Process
- Capacity Planning — Part Three: Benefits and Helpful Tips
- Capacity Planning – Part Four: Hidden Upgrade Costs and
- Improving Business Process Management, Part 1
- Improving Business Process Management, Part 2
- 20 Major Elements of Facilities Management
- Major Physical Exposures Common to a Data Center
- Evaluating the Physical Environment
- Nightmare Incidents with Disaster Recovery Plans
- Developing a Robust Configuration Management Process
- Developing a Robust Configuration Management Process – Part Two
- Automating a Robust Infrastructure Process
- Improving High Availability — Part One: Definitions and Terms
- Improving High Availability — Part Two: Definitions and Terms
- Improving High Availability — Part Three: The Seven R's of High Availability
- Improving High Availability — Part Four: Assessing an Availability Process
- Methods for Brainstorming and Prioritizing Requirements
- Introduction to Disk Storage Management — Part One
- Storage Management—Part Two: Performance
- Storage Management—Part Three: Reliability
- Storage Management—Part Four: Recoverability
- Twelve Traits of World-Class Infrastructures — Part One
- Twelve Traits of World-Class Infrastructures — Part Two
- Meeting Today's Cooling Challenges of Data Centers
- Strategic Security, Part One: Assessment
- Strategic Security, Part Two: Development
- Strategic Security, Part Three: Implementation
- Strategic Security, Part Four: ITIL Implications
- Production Acceptance Part One – Definition and Benefits
- Production Acceptance Part Two – Initial Steps
- Production Acceptance Part Three – Middle Steps
- Production Acceptance Part Four – Ongoing Steps
- Case Study: Planning a Service Desk Part One – Objectives
- Case Study: Planning a Service Desk Part Two – SWOT
- Case Study: Implementing an ITIL Service Desk – Part One
- Case Study: Implementing a Service Desk Part Two – Tool Selection
- Ethics, Scandals and Legislation
- Outsourcing in Response to Legislation
- Supplier Management
- Identifying Key External Suppliers
- Identifying Key Internal Suppliers
- Integrating the Four Key Elements of Good Customer Service
- Enhancing the Customer/Supplier Matrix
- Voice Over IP, Part One — What VoIP Is, and Is Not
- Voice Over IP, Part Two — Benefits, Cost Savings and Features of VoIP
- Application Management
- Production Acceptance
- Distinguishing New Applications from New Versions of Existing Applications
- Assessing a Production Acceptance Process
- Effective Use of a Software Development Life Cycle
- The Role of Project Management in SDLC— Part 2
- Communication in Project Management – Part One: Barriers to Effective Communication
- Communication in Project Management – Part Two: Examples of Effective Communication
- Safeguarding Personal Information in the Workplace: A Case Study
- Combating the Year-end Budget Blitz—Part 1: Building a Manageable Schedule
- Combating the Year-end Budget Blitz—Part 2: Tracking and Reporting Availability
- References
- Developing an ITIL Feasibility Analysis
- Organization and Personnel Management
- Optimizing IT Organizational Structures
- Factors That Influence Restructuring Decisions
- Alternative Locations for the Help Desk
- Alternative Locations for Database Administration
- Alternative Locations for Network Operations
- Alternative Locations for Web Design
- Alternative Locations for Risk Management
- Alternative Locations for Systems Management
- Practical Tips To Retaining Key Personnel
- Benefits and Drawbacks of Using IT Consultants and Contractors
- Deciding Between the Use of Contractors versus Consultants
- Managing Employee Skill Sets and Skill Levels
- Assessing Skill Levels of Current Onboard Staff
- Recruiting Infrastructure Staff from the Outside
- Selecting the Most Qualified Candidate
- 7 Tips for Managing the Use of Mobile Devices
- Useful Websites for IT Managers
- References
- Automating Robust Processes
- Evaluating Process Documentation — Part One: Quality and Value
- Evaluating Process Documentation — Part Two: Benefits and Use of a Quality-Value Matrix
- When Should You Integrate or Segregate Service Desks?
- Five Instructive Ideas for Interviewing
- Eight Surefire Tips to Use When Being Interviewed
- 12 Helpful Hints To Make Meetings More Productive
- Eight Uncommon Tips To Improve Your Writing
- Ten Helpful Tips To Improve Fire Drills
- Sorting Out Today’s Various Training Options
- Business Ethics and Corporate Scandals – Part 1
- Business Ethics and Corporate Scandals – Part 2
- 12 Tips for More Effective Emails
- Management Communication: Back to the Basics, Part One
- Management Communication: Back to the Basics, Part Two
- Management Communication: Back to the Basics, Part Three
- Asset Management
- Managing Hardware Inventories
- Introduction to Hardware Inventories
- Processes To Manage Hardware Inventories
- Use of a Hardware Inventory Database
- References
- Managing Software Inventories
- Business Continuity Management
- Ten Lessons Learned from Real-Life Disasters
- Ten Lessons Learned From Real-Life Disasters, Part 2
- Differences Between Disaster Recovery and Business Continuity , Part 1
- Differences Between Disaster Recovery and Business Continuity , Part 2
- 15 Common Terms and Definitions of Business Continuity
- The Federal Government’s Role in Disaster Recovery
- The 12 Common Mistakes That Cause BIAs To Fail—Part 1
- The 12 Common Mistakes That Cause BIAs To Fail—Part 2
- The 12 Common Mistakes That Cause BIAs To Fail—Part 3
- The 12 Common Mistakes That Cause BIAs To Fail—Part 4
- Conducting an Effective Table Top Exercise (TTE) — Part 1
- Conducting an Effective Table Top Exercise (TTE) — Part 2
- Conducting an Effective Table Top Exercise (TTE) — Part 3
- Conducting an Effective Table Top Exercise (TTE) — Part 4
- The 13 Cardinal Steps for Implementing a Business Continuity Program — Part One
- The 13 Cardinal Steps for Implementing a Business Continuity Program — Part Two
- The 13 Cardinal Steps for Implementing a Business Continuity Program — Part Three
- The 13 Cardinal Steps for Implementing a Business Continuity Program — Part Four
- The Information Technology Infrastructure Library (ITIL)
- The Origins of ITIL
- The Foundation of ITIL: Service Management
- Five Reasons for Revising ITIL
- The Relationship of Service Delivery and Service Support to All of ITIL
- Ten Common Myths About Implementing ITIL, Part One
- Ten Common Myths About Implementing ITIL, Part Two
- Characteristics of ITIL Version 3
- Ten Benefits of itSMF and its IIL Pocket Guide
- Translating the Goals of the ITIL Service Delivery Processes
- Translating the Goals of the ITIL Service Support Processes
- Elements of ITIL Least Understood, Part One: Service Delivery Processes
- Case Study: Recovery Reactions to a Renegade Rodent
- Elements of ITIL Least Understood, Part Two: Service Support
- Case Studies
- Case Study — Preparing for Hurricane Charley
- Case Study — The Linux Decision
- Case Study — Production Acceptance at an Aerospace Firm
- Case Study — Production Acceptance at a Defense Contractor
- Case Study — Evaluating Mainframe Processes
- Case Study — Evaluating Recovery Sites, Part One: Quantitative Comparisons/Natural Disasters
- Case Study — Evaluating Recovery Sites, Part Two: Quantitative Comparisons/Man-made Disasters
- Case Study — Evaluating Recovery Sites, Part Three: Qualitative Comparisons
- Case Study — Evaluating Recovery Sites, Part Four: Take-Aways
- Disaster Recovery Test Case Study Part One: Planning
- Disaster Recovery Test Case Study Part Two: Planning and Walk-Through
- Disaster Recovery Test Case Study Part Three: Execution
- Disaster Recovery Test Case Study Part Four: Follow-Up
- Assessing the Robustness of a Vendor’s Data Center, Part One: Qualitative Measures
- Assessing the Robustness of a Vendor’s Data Center, Part Two: Quantitative Measures
- Case Study: Lessons Learned from a World-Wide Disaster Recovery Exercise, Part One: What Did the Team Do Well
- (d) Case Study: Lessons Learned from a World-Wide Disaster Recovery Exercise, Part Two
These first few years of the new millennium have ushered in a large number of corporate accounting scandals. As a result, the federal and state governments of the United States have introduced a number of new pieces of legislation to hold corporations and the executives who run them more accountable. Many of these new laws, such as Sarbanes-Oxley, have direct impact on IT organizations and their managers who are being held responsible for the financial reporting systems that their teams design and operate.
One of the consequences of all the increased accountability of corporate executives and their IT reporting systems is the consideration to outsource some or all of a company's IT organization. This article discusses some of the issues surrounding outsourcing, especially as it pertains to responding to recently-enacted laws affecting IT governance.
There certainly are other factors that come in to play when making an IT outsourcing decision. Table 1 lists some of the more common of these factors, and in the following section I will describe each of them in more detail. Chief among these are the overall cost savings and other benefits to be realized versus some of the drawbacks to outsourcing. But the additional responsibilities of legislation such as Sarbanes-Oxley are causing many a CEO, and in some cases their CIOs, to look seriously at outsourcing some if not all of their IT environments.
Table 1 Factors Influencing Outsourcing Decisions
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1. overall cost savings 2. scalability of resources 3. potential loss of control 4. total cost of maintaining an outsourcing agreement 5. credibility and experience of outsourcer 6. possible conflicts of priority 7. geographic and time zone differences 8. language barriers 9. cultural clashes |
- Overall Cost Savings — For most companies the primary reason for outsourcing is the potential of substantial cost savings from reduced labor and assets. What many companies discover after the fact is that costs start increasing for such things as extended support, new applications or other unforeseen additions to the original statement of work. Contracts need to be drawn up as thoroughly as possible to prevent experiencing these types of hidden cost increases.
- Scalability of Resources — Another benefit of outsourcing is the ability to adjust the quantity of contracted resources. In other words, you pay only for what you use. This ability to easily scale the amount of services used can be very appealing for companies that may expect to experience wide variations in resource use due market fluctuations, acquisitions or divestitures.
- Potential Loss of Control — One of the drawbacks of outsourcing is the loss of onsite control over the contracted processes and services. Clients sometimes express concern especially over the caliber of personnel used in call centers and help desks, or the knowledge of managers on legislative and audit requirements. Due diligence during the evaluation stage can help reduce this risk.
- Total Cost of Maintaining an Outsourcing Agreement — Some clients of outsourcing providers discover that the ongoing maintenance and updating of the contact can be far more time-consuming and costly than originally expected. This is where the literal reading of the fine print can help reduce these unexpected surprises down the road.
- Credibility and Experience of Outsourcer — Once the decision to outsource has been made, the evaluation and selection of the winning vendor needs to take place. Verifying the credibility and experience of the outsourcing supplier is critical, particularly if Sarbanes-Oxley compliance is one of the reasons for outsourcing. Customer testimonials play a key role in this activity.
- Possible Conflicts of Priority — The more successful and experienced that an outsourcing company becomes, the more likely it is they will take on ever an ever increasing number of clients. Care must taken to ensure that the quality of service does not degrade if and when higher priority clients (those generating more revenue) enter the picture.
- Geographic and Time Zone Differences — A number of outsourcing companies are situated in areas that are several time zones away from the client location. A number of these outsourcers reside outside of the United States. The geographic locations and time zone differences should be considered when contracting outsourced services. The peak periods of the client may be typical down periods at the outsourcing site, and this may become a factor when signing long-term contracts.
- Language Barriers — Clients who contract with outsourcing companies located in regions such as the Middle and Far East may encounter language barriers with support personnel. This can especially be an issue when contracting for call centers, help desks and support groups. Appropriate verification should be confirmed prior to signing.
- Cultural Clashes — Last but certainly not least among the factors that can influence an IT outsourcing decision is the issue of culture clashes. The culture of the outsourcing supplier should mesh as closely as possible with that of the client company. At the very least the two cultures should not be at odds with each other. For example, I worked at a defense contracting company who was very much in tune with the highly structured culture of their military clients. When selecting an outsourcer for their IT organization the defense contractor ensured their outsourcer had a similar culture that emphasized structure, organization and hierarchy.
The effects of outsourcing an IT organization will vary from company to company. The effects will also depend on whether all or only parts of the IT department are to be outsourced. Many companies today outsource their call centers or service desks to locations such as India or the Philippines. Other companies elect to keep service-oriented functions such as call centers but outsource programming or web development projects to countries such as Viet Nam or South Korea.
Regardless of how much of an IT organization is outsourced, the benefits of maintaining high ethical standards remain. When evaluating which particular outsourcer to use, many companies today include compliance to SOX-like legislation involving corporate governance as part of the selection criteria. One key lesson all the business scandals of recent years taught very well was that violating basic business ethics seems to always result in far greater loner-term losses than any short-term gains.