The pros and cons of IT outsourcing

With the majority of medium and large enterprises going through data centre consolidation programs, the option of bringing in outsourcers may look attractive, but traps and pitfalls abound for the unwary

Cost, business continuity and capacity issues are driving IT managers across the country to pull out what little hair they have left as they struggle to keep up with management demands to cut energy use, make data highly available and manage ageing equipment.

The likelihood that a carbon tax could soon become a reality — drastically increasing the cost of running a data centre and putting pressure on cutting CO2 emissions of IT gear — means IT managers now have even more motivation to offload their data centres to someone else. Enter the outsourcing option.

Through outsourcing the data centre IT departments can quickly find new business continuity and disaster capabilities, considerable cost savings, the ability to scale up and down based on the needs of their business, as well as having specialist skills and advice readily to hand.

Business continuity and disaster recovery

The Queensland floods and recent earthquakes in Christchurch and Japan have delivered a grim reminder that disasters can and do happen. As such, these events should spur organisations to get disaster recovery and business continuity plans in place ASAP. Outsourcing your data centre — particularly to a provider in a different state — can be one of the quickest and most cost-effective ways of doing this.

Australian Rail Track Corporation (ARTC) is one organisation to realise the benefits of outsourcing its data centre. The South Australia-based government agency’s technology and infrastructure manager, Steve Bogdanov, says he now has the ability to transfer information to Victoria thanks to the upgrade of its data centre via partner EMC.

“We were after a disaster recovery solution and this drove the business case for the data centre,” he says. “We wanted to adopt a new shared infrastructure model to provide a more agile and efficient delivery method for the business. We also wanted to greatly improve our recovery capabilities.”

Working with government agency CrimTrac, Logica’s federal government account manager, Darren O’Shannassy, was commissioned to build a second data centre as part of the agency’s data centre upgrade.

While creating two data centres was a disaster recovery tactic suitable for CrimTrac, O’Shannassy says that every business will have different requirements and shouldn’t undertake such an investment without weighing up the risks.

“I’d take it back to your business requirements,” he says. “What does your business need? Do you need to be back in immediately? Will this take two hours or two days? Those things need to drive your thinking.”

Macquarie Telecom managing director of hosting, Aidan Tudehope, also cautions against using disaster recovery as the sole reason for data centre outsourcing, arguing that while disasters such as those in Queensland and Christchurch elevate the notion of geography, there are bigger fish to fry.

“Things like the floods in Queensland elevate the notion of geography, but the reality is that this is not the biggest risk in aggregate,” he says. “There are many other risks that happen more frequently than that, and they don’t require you to be in another city, but rather in another part of the network.”

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