Choosing Between Outsourced Vs In-House Data Management Strategies

Data management strategies are essential for any modern organization and can be outsourced or handled in-house.

choosing between an in-house vs outsourced data management strategy
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There is no question that data has become a valuable asset to almost every organization. Companies use big data to optimize their marketing strategies, maintain better relationships with their customers, manage their financial strategies and improve human resources capabilities.

Unfortunately, data isn’t always easy to manage. You need to rely on the services of a well trained specialist that understands the nuances of big data technology. This explains the growing opportunities for people looking for careers as a data scientists.

It is Important to Find the Right Approach to Manage Your Data Effectively

Data is the backbone of almost every business, yet it can be difficult to know how to manage it. While most businesses start out with one or two IT professionals, your requirements can quickly outpace what they are able to provide. Moreover, IT is a broad church, and the staff you have in-house may not be able to expand into the services you want or need. They may not have experience as data scientists, so you might need to hire a professional to assist you.

Conducting work in-house is often seen to be better than outsourcing by default, but this isn’t necessarily true of IT. While outsourcing your data management strategy isn’t always the best solution, it does confer a number of unique advantages – and can be both cheaper and more flexible for businesses on certain scales.

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What is the difference between an in-house and outsourced data management strategy?

In-house IT is where you employ a dedicated staff member or team to manage your IT infrastructure. They will be on site to perform maintenance, upgrades and installations, and provide technical support where needed. They will become the face of IT in your organization, extracting all the benefits of IT while smoothing over any problems. They might also be able to help manage your data, but that is going to depend on their training and proficiency with data management. Data science is a very specialized skill that not all IT professionals can handle.

Outsourced IT is where all or part of your IT department is outsourced to an IT managed services company. The external company will use the collective expertise and manpower of its staff to provide the same services as an in-house team, as well as its hardware and infrastructure to provide a range of services, such as cloud hosting and data storage.

Advantages of in-house IT

In-house IT can be both a starting point and endpoint for many businesses. It’s not unusual for businesses to employ an IT specialist or two in their formative stages to implement and oversee key services and establish a strong digital framework, which will be crucial for any data-driven organization. Used on a small scale, it may be that having one person oversee your IT infrastructure is more cost-effective and practical than employing an external service provider for relatively small tasks.

Conversely, many larger businesses will have a substantial in-house IT department to keep their gargantuan infrastructure running smoothly. As well as providing on-site and remote technical support, they will oversee things like data rooms and data centers and give the business a large degree of control and autonomy when developing and implementing new digital products or services.

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In-house IT works well when your needs are limited or hyper-specific. Having an in-house IT team allows for IT to be embedded within your business in a way that both gives you absolute control over your IT, and develops a mutual understanding of IT. Your IT department will have a stronger understanding of your culture and needs, and the rest of your business will benefit from the exposure to and interactions with your IT department. They will also have full autonomy over your data, so you don’t have to worry about a third-party data management service leaking it.

Disadvantages of in-house IT

The area where in-house IT providers encounter problems is when you need to scale your data capacity. As you require more and more varied IT services, you will likely need to store more data and hire more IT staff with different specialties. This presents not just a financial issue, but one of managing your IT department, and having the knowledge to make good hiring decisions. Without knowing exactly what you need from your IT, your IT department could become bloated, and your services ineffective. This is especially true if you have sophisticated data needs.

You’ll also face limits on what you can do with your IT services, and how quickly you can react to problems. While an in-house IT team is beneficial when reacting to issues during working hours, you won’t have anyone to help if a website or service goes down outside of office hours, or if your site or servers get hacked. You may also not have the manpower to undertake certain projects, either slowing you down or forcing you to hire employees you may only need temporarily.

Advantages of outsourced IT

The greatest advantage of an outsourced IT service provider is its flexibility. With the ability to scale up or down as your business’ needs and requirements change and your data needs evolve, outsourced IT makes it much easier to pivot to new services, and test out new ideas. If you have a temporary project to undertake, you’ll immediately have access to the manpower you need, without having to hire more workers.

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Outsourced IT also tends to be more cost-effective than in-house IT, especially if you manage a much larger volume of data. The relative benefits you’ll get from harnessing multiple IT experts will be far cheaper than hiring those experts yourself, and you’ll only be paying for them when you need them. Instead of paying flat salaries, you’ll be able to adjust what you pay depending on what you’re using, scaling your involvement with the IT service provider up or down as required.

Perhaps most crucially, you’ll have support that you can rely on whenever you need it. Outsourced IT service providers are generally on-hand 24/7, ensuring that you have reliable technical support at all hours. This is not only great for supporting international businesses operating in different time zones, but also for monitoring your internal data and reacting to issues, minimizing data center and website server downtime and responding to data security breaches.

Disadvantages of outsourced IT

While an outsourced IT service provider will strive to forge a close connection with your business, they are only as accessible as you allow them to be, and you may find it quicker or easier to communicate with an in-house IT team. This is particularly true if you have complex requirements that you find hard to communicate, or which are particular to your company’s culture or industry niche.

Working with an outsourced IT service provider also requires a high level of trust. As mentioned, IT is of critical importance to many businesses, because it is a major driver and facilitator of sales. To make the most of your IT strategy, you’ll need to maintain strong links with your IT service provider and ensure that they gain a full picture of your requirements, both in the present and the future.

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Of course, there is also the option of trying to have both! It’s not uncommon for some businesses to have both a substantial in-house IT department and utilize an IT service provider for some outsourcing. This may be sensible if your business has specific IT requirements that are best served by in-house IT professionals, such as a very specific piece of industry-related software, but also has needs such as cloud hosting outside of their remit.

Whether you choose to use an in-house or outsourced IT (or both!) will depend on the role IT plays in your business, the amount of data you will store and how this role is likely to expand in the future. While in-house IT has its place – particularly in larger organizations – outsourcing your data management strategy is likely to give you the flexibility and cost-savings you need to scale more effectively and reinvest in improving your digital infrastructure.

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Sota is one of the UK’s leading independent providers of professional IT services in Kent, cloud computing, cyber resilience, connectivity, and unified communications. Having worked with countless businesses over the years, they are experts in their field, ready to advise and offer tailored solutions for each and every company.

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Thinking About F̶i̶l̶e̶ ̶M̶a̶n̶a̶g̶e̶m̶e̶n̶t̶ V̶e̶r̶s̶i̶o̶n̶ ̶C̶o̶n̶t̶r̶o̶l̶ Collaboration. Co-Founder Mito. Ex @ConsenSys