The state of IT services and procurement dynamics in the enterprise

Despite bringing more services in-house, enterprise firms remain comfortable allowing third-parties to address critical IT services

Enterprise Data Center

Author

Grayson Kemper is a Content Developer and Marketer with Clutch

In a business landscape shaped and driven by information technology, enterprises’ ability to prioritize and strategically manage their IT assets has a direct impact on their core business operations.

Given the current enterprise IT complex, determining how to address critical IT services needs occupies a much greater degree of importance for these firms. Enterprises now must make procurement decisions for IT services understanding the company-wide impact these services now entail.

Security, importance lead shift in-house

The process of procuring IT services involves multiple factors for enterprises to consider, the foremost of which is security. Particularly, enterprises have to trust the security of their company data with whomever they tap to address IT services needs.

As more and more enterprise transitions from legacy storage to digital-based solutions under the purview of the IT department, ensuring security of IT services is paramount to ensuring the security of an entire company.

Given their standing, it is fairly unsurprising that 50% of enterprises plan to move more IT services in-house in 2017, according to recent research from Clutch, a B2B research firm.

In addition to security concerns, the degree to which a particular IT service qualifies as a “core service” factors into enterprise decisions whether to keep the management of that service internal, according to Magnus Jern, Chief Innovation Officer for DMI. The more critical the service to business operation, the more likely that service is handled in-house, claims Jern.

“One of the most important ones is, is it core to the business. If it is, then you want to make sure you have control over it,” said Jern, when asked about the factors that play into deciding whether to handle IT service needs in-house versus outsourcing.

Viability of IT outsourcing

Despite the trend toward building out in-house IT, though, enterprises also heavily rely on outsourcing IT services to third-party service providers–three-fourths claim that they currently partner with an third-party provider for IT services.

Moreover, the most common IT service that enterprises outsource to third-parties is data security services. This seems to indicate that despite bringing more services in-house, enterprise firms remain comfortable allowing third-parties to address critical IT services.

There a few possible explanations for the apparent disconnect between the trend toward in-house IT and the outsourcing of data security services.

The first of which is rooted in logic: the trend toward expanding in-house IT service capabilities is just that, a trend. Just because more IT service needs are met in-house does not mean that outsourcing as a practice is being altogether abandoned, which is proven by the amount of enterprises that still outsource IT services.

The second explanation is rooted in a bit more analysis, but follows logically all the same. Since data security represents such an important component in the enterprise IT space, enterprises seek out field experts from IT service providers to handle IT services priorities, like data security. Simply put, IT service providers more likely possess the expertise and talent suited for premium IT services, such as data security, that enterprises may be unlikely to have within their internal IT departments.

Given these explanations, it seems that while enterprises express preference toward in-house handling of IT services needs due to more control and a lack of security exposure it offers, some still would rather have experts from outsourced resources address high-priority services.

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