What Really Adds Value to Your Business?

cloud reflectionWatching the outsourcing decision of some organisations, I wonder if they really understand what really adds value to their business! Stepping back and looking at them from the outside, I doubt they can genuinely justify their choices for the target of their cost saving exercises?

Which one of these adds more value to the business; a major development project to implement a CRM system to generate more revenue, or keeping the day-to-day running of the racks of servers in the machine room? Time and again I watch, as the supposedly easy and risk free outsourcing targets are chosen, especially the value-adding development projects, whereas the question of real “day to day” IT is avoided because it is seen as too risky or too difficult to change. Ask yourself, is this really the case?

Many organisations have now shown that putting their core activities into the cloud, using  IaaS or PaaS models saves running costs and makes change easier. This means transferring the running and management of the servers and their associated platforms to an external provider, removing the assets from the balance sheet, and outsourcing the management of the base services like backup and monitoring. It is clear that these core services of installing, running, monitoring, backing up, updating and general care of servers are a commodity service (when you can buy that service “pay-as-you-go” over the wire, and the service is the same utility for all types of business it must be a commodity). If it is a commodity then it must be something every business should look at whether they buy rather than provide themselves. It is the time for a hard look at these core services and to ask the question; do they really add value? This may appear a difficult business decision, but the discipline of cost-benefit and risk analysis can and will conquer the inertia in organisations. Not everyone will change but those who overcome the inertia in their organisations will be the new leaders, as they can then focus on their real value added functions.