Thought Leadership

Hosting: Lead With Your Business Priorities Part 2

We've got your back.In Part 1, we discussed the two critical factors of flexibility and up time, and how the options you choose will determine the outcome [ click here for Part 1].  Does it contribute to your bottom line? Does it provide fail over insurance? Will you get both quantity and quality of up time?

We also touched on the issue of control, which we want to explore in more depth, specifically:

(1)    The prevailing mindset about the idea of “control”, and
(2)    The value of a new mindset about control.

 What’s your definition of control?

The dictionary’s definition is: “to exercise authoritative or dominating influence over; to direct”.  We suspect the typical definition is a loose translation of micro management.  And, carries the unspoken expectation and illusion of guaranteed success 100% of the time.

Any time you transfer responsibilities, you take the risk of reduced quality of service.  So, understandably, transferring direct oversight to an outside provider can feel like a lack of control.  The fact of the matter is you are already vulnerable even with on site hosting.  Your data is at risk from any number of internal or external factors, such as applications, or a server crash.

The new mindset: Knowing what you CAN control

There are a variety of reasons to consider outsourcing:

•    You need additional capacity.
•    You don’t have resources or skill levels to do it in house.
•    You see it as a way to cut cost, or get more for your money.

When you maintain your own infrastructure, cost is a control issue in itself in terms of capital outlays and operating expense. Here are a few examples:

•    initial capital expenditures, which requires renewals every 5-7 years;
•    real estate value and building maintenance;
•    staffing cost (salary, insurance, continuing education); and
•    operating costs (electrical, air, security, communications).

Another cost factor is the amount of data you’re going to be creating every minute of the business day from now on.  You may not be able to keep up with the exponential growth of data being generated on a daily basis.  A recent article in Computer World makes a pointed case on this issue:

Stored data is growing at 35% per year, according to Boston-based Aberdeen Group. That means IT departments have to double their storage capacity every 24 to 30 months. “Today, an average of 13% of [the money in] IT budgets [is] being spent on storage,” says Aberdeen analyst Dick Csaplar. “Two and a half years from now, it will be 26%, and then 52%. Pretty soon, this ratchets out of control, so you can’t keep doing the same things over and over.”

The controllable factors

The good news is there are ways to achieve control should you consider outsourcing your hosting needs. And, they all involve your taking the lead.

Due diligence: Because you’re relying on a third party’s ability to perform, it is incumbent on you to research vendors, and their performance record.  You can facilitate the vetting process and shorten the list of vendors for further consideration by being clear on your expectations and your definition of success.

Control over contract and expectations: Outsourcing is often interpreted as giving up control, and one contributing factor is the common mistake of accepting contracts of a third party vendor.  This means you are accepting their measurements and expectations, rather than writing your own contract and specifying your expectations.

Address hidden costs in your contract: These include unforeseen challenges or opportunities that may arise and need to be addressed, but might be excluded from the original contract.  Including such unforeseen factors in the contract allows you to transfer that risk to the third party vendor.

Take control by knowing what’s real and what’s not

Discerning what you can control puts you in the driver’s seat.  And as you deliberate your hosting options, staying faithful to your business priorities will serve you well. Here’s a brief checklist to help with the evaluation process.

  •        Which option will contribute the most to your bottom line?
  •        Does it provide fail over insurance?
  •        Will it provide the quantity and quality of up time you need?
  •        Have you identified the controllable factors, and defined what “success” means to you?



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