In the ever-growing realm of cloud computing, virtualisation and managed and hosted IT services, organisations are faced with the big question: should we leverage hosted services or should we expand on existing in-house IT infrastructure?
Although at first glance, building, operating and managing an in-house IT Infrastructure seems to be the obvious, reasonable and cost effective choice for most businesses, hosted services also has its benefits – specifically when it comes to cost, flexibility, scalability and managed service platform. The decision must be weighed carefully against key business objectives to make the optimum decision.
This article will discuss and evaluate several factors against both delivery models - hosted IT services models and traditional in-house IT services model.
For many, cost is the number one driver and qualifying criteria for any IT product and service. Organisations seek IT solutions that not only automate business processes and improve performance but also have less TCO and a quicker ROI. In this regard, in-house IT infrastructure is much more expensive to create and manage. Organisations have to pay substantial upfront capital costs to source IT resources, manage and plan for infrastructure upgrades and depreciation costs, along with ongoing operational and maintenance costs to operate and manage such an environment.
In comparison, the hosted IT service models provide a flexible and predictable monthly cost based on the amount of hosted services being used. There is hardly any capital or operational costs attached with hosted services and organisations just have to pay a fixed or pay-per-use monthly rental. Moreover, the vendor is responsible for managing the costs associated with backend infrastructure upgrades.
Organisations these days move at a very fast pace and require access to IT infrastructure that stays up to the mark with the business. Technological advancements, ever evolving business functions and changing markets requires backend IT’s flexibility to adjust and address new challenges. Traditionally, in-house IT can be flexible but only up to a certain point. They usually don’t welcome a new IT advancement and constrain themselves to a specific technology and limited skill sets.
In comparison, hosted IT services must innovate, change and evolve on an ongoing basis. A good hosted IT service provider will embrace IT flexibility and adapt to new and unique business requirements.
Similar to IT flexibility, growth trends and business evolution have equal effects on the backend IT infrastructure supporting it. Organisations working in fast paced consumer environments generally face several scenarios where computing requirements surpass the ability of in-house IT infrastructure.
Hosted service providers mostly have IT infrastructure that can scale and sprawl to greater capabilities and do so quickly as required. Most resources are added to the existing resources instantly - which generally take days and weeks in a traditional IT delivery model. An established hosted IT service provider will have a broad range of solutions and services enabling organisations to source only a single provider for all their needs, thus decreasing IT complexity.
Skilled employees and resources are the key to managing a highly efficient, readily available IT infrastructure. However, it’s very difficult to find and hire good employees, especially if your organisation has limited IT skills. Even if you somehow have access to such personnel, their performance turnover is unpredictable and their sudden absence can leave IT in shambles. With hosted services, the hosted service provider will do whatever it takes to hire and retain the best resources to deliver consistent and reliable IT services for their clients. They usually have access to multiple highly skilled, qualified and certified IT human resources.
Information and infrastructure security is something that can’t be extracted out from any IT environment, whether in-house or hosted. Even companies running a basic website and some e-mails require a level of security to avoid intrusions and exploits. When it comes to in-house security, small and medium organisations generally have limited security capabilities. They rely on standard security practices and usually don’t innovate or change to increase their security. However, with hosted services, a hosted service provider is bound to implement and manage enterprise-class security measures that go beyond basic security techniques. They are usually certified with industry leading security standards and certifications and have well-crafted security measures.
Perhaps among the top requirements for any IT environment, IT services delivery and its continuous monitoring is a key business requirement. With in-house IT environments the internal resources manage and monitor the IT infrastructure and ensure it remains above the benchmark requirement. Organisations large or small rely on their IT staff for delivering business critical applications, interacting with customers and automating business processes. However, most small to medium businesses lack such management and monitoring support around the clock. If a service fails in the later hours of the day, the response and resolution time is comparatively higher. With a hosted service provider, organizations receive 24/7/365 IT services and monitoring support-backed by service level agreements and performance based pricing. With the always-access service platform of hosted IT service, delivered through the collective pool of IT and human resources, service degradation and failures are quickly addressed and resolved.