IT Support for SMEs

by on 09/12/2009

This article looks at the problems with running an in-house IT function in a SME and discusses how outsourcing solves these issues. It goes on to discuss the process of selecting your outsourced IT partner and ends with a discussion on how to manage your IT in a SME.

FITM provides an independent and flexible outsourced IT Director service. FITM also specialises in the selection of outsourced IT support companies and in contract, cost and SLA negotiation. Please contact FITM for further information.

In-house Versus Outsourced IT

A large company typically has an in-house IT department. Headed up by an IT Director, this will consist of a number of specialist engineers, each with detailed specific knowledge and each responsible for a separate technical area.

Trying to run an internal IT department in a SME leads to various issues:

  • The IT Director role is not justified. The department tends to be run by a more junior IT Manager who is good technically but lacks management and strategic skills and experience. Board level responsibility for IT often rests with a non-IT person who does not have the time or the knowledge to run the function effectively.
  • The IT support engineers in an internal IT department need to have a wide range of IT knowledge in order to support all the technology in use. This means that they will not have depth of knowledge in any single area, and so systems will not be set up optimally, and problems will occur and will take longer to remedy.
  • A small number of engineers is needed, perhaps 1 (or even less). It will only be possible to provide IT support during standard business hours and there will be issues when an engineer is not in the office due to holiday, sickness or training.

As with all departments in a modern business, it is possible to outsource some or all of the IT function. The arguments for outsourcing IT are particularly persuasive. Outsourcing enables a small company to have access to specialist technical knowledge, to handle support out of core hours and to cope with engineer absences. In addition, there are significant cost savings to be made as third party IT companies have economies of scale, occupy cheaper premises etc.

The obvious candidate for IT outsourcing is the IT support function, both the user facing help desk and the support of the infrastructure and network.

Selecting an Outsourced IT Support Provider

In an ideal world, a company would go through a formal process when selecting an IT support provider, looking at factors such as:

  • Location. It is possible for all IT support to be provided remotely, and this model provides significant cost saving. However, it may be important for some companies to physically see their support engineers periodically and for these companies, the support company needs to be located nearby.
  • Size. The size of the support company is an important criterion to consider. In principle, larger support companies have greater economies of scale and so are able to offer a cheaper service. However, a SME may choose to be a significant customer to a smaller provider.
  • Financial stability, type of company, client & staff retention etc.
  • Services provided, support hours etc.
  • Proactive versus reactive. All support companies provide a reactive support service – if you call them with a problem, they will attempt to resolve it. It is important to also understand what proactive services they provide. For example, a good support company will monitor servers 24×7, receiving alerts when there is a problem and enabling them to fix issues without any impact to users.
  • Helpdesk. Can issues be logged by telephone, email or online? Can the user set a priority? What reports are provided to show call volumes, average response and resolution times etc.?
  • Cost.

This selection process will result in a supplier or a shortlist of potential suppliers and then contract, cost and service level agreement (SLA) negotiations can start. The cost of the support service is clearly a critical factor, but it is hard for a SME to know what market rates are and how low they can negotiate the cost without affecting the service provided.

Once negotiations are complete, the support company can start to provide support. The process to transfer knowledge from an internal IT function or an incumbent supplier can be problematic and needs to be handled carefully.

Managing Your IT

Once you have your IT support company in place, it is important to actively monitor them to ensure that they are providing the service you are paying for and require. The provider should provide reports on the performance of your systems and their helpdesk. Regular account meetings should be held to review these and to discuss projects and enhancements to the technical infrastructure.

A typical SME will have many third-party IT companies as well as the IT support company. These may include the ISP, land line and mobile phone providers, web site development and hosting companies, data providers etc. It is important to manage all of these effectively to ensure that they are providing a good service, value for money and that systems are integrating efficiently.

It is also important to consider more strategic topics such as:

  • Business Continuity Planning (BCP) / Disaster Recovery (DR). This is sometimes seen as a costly, complicated and unnecessary process. However, when implemented pragmatically, BCP can provide a low-cost solution should a company suffer a disaster, and the process of analysing requirements and priorities is often very helpful to understanding how a business is operating.
  • Environmental policy. A sound environmental policy is important to every company not just because of corporate social responsibility, but because customers are asking for copies more and more frequently. The surprise is that green policies often cut costs as well, for example by saving on power consumption and hardware requirements.
  • Projects. Latest research shows that only a third of IT projects are delivered on time, on budget and with all required features and functions. With most, if not all, companies undertaking several projects in the course of a year, it is clear that choosing and managing projects effectively is critical.
  • Budget. What is the company’s IT spend and how does that compare against the IT budget if one exists? What is next year’s budget, in keeping with the project pipeline and the IT strategy? Cost control is also critical. Within any IT environment, it is possible to make significant savings by reviewing IT usage, renegotiating contracts, changing suppliers etc. In addition, new technologies exist which bring significant benefit and also pay for themselves in less than two years.
  • Strategy. It is important for every company to have an IT strategy. I.e. to have a document describing the direction in which IT is moving, the timeframe and cost, and most critically how this supports the business strategy. Setting the IT strategy firstly involves understanding the business strategy. For example, is the business going to double in size in the next year, is it going to open branch offices, is the emphasis for the next year on cost reduction or on improving the service that is provided both internally and externally, what is the demand for new technologies, e.g. social networking and smartphones? Once the business drivers are understood, then an IT strategy can be formulated which underpins and supports this. Other elements of an IT strategy are consideration of technologies, especially new technologies, and evaluate whether they bring business benefit.

These topics are traditionally the responsibility of the IT Director, who also runs the IT department and monitors third parties. Companies now exist that offer “virtual IT Director” services to SMEs who cannot afford or justify an in-house person. These companies provide independent and flexible resource as and when it is needed, for example a day a week.

How Can FITM Help?

FITM offers a virtual IT Director service providing your business with the benefits of an IT Director at a fraction of the cost. Working as part of your management team, FITM saves you time and money as well as reducing the risks and consequences of IT failure.

FITM also offers a full IT support consultancy service. FITM will work with you to define your support requirements and match these against its database of support companies to create a shortlist. FITM are experienced in cost, contract and SLA negotiation and can ensure that the transition from your existing support arrangements goes smoothly and with minimum disruption to your business. FITM has negotiated discounts with some IT support companies and so may be able to save you money as well as improving your IT support arrangements.

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