SMB IT Question of the Month: Will the Cloud Replace My IT Department?

Many IT consulting services called last year “The Year of the Cloud” and predicted that SMBs would soon run most of their technological applications via the Internet. From data storage to disaster preparedness to software licensing, it seemed that nearly all IT managed services could be outsourced to cloud-based providers – and fuddy-duddies who failed to jump on the cloud bandwagon would soon be left in the dust.

Yet, looking around the current IT business landscape, it’s clear that many businesses are still relying on internal resources to keep their IT operations running smoothly. Were the cloud proponents right in saying that internet-based IT services would soon replace in-house IT departments? Or is there still a need to keep in-house experts on staff to oversee IT operations?

Clearly, the answers to these questions depend on the nature of the individual business. Criteria to consider include:

Core product/service or chore. If internet-based services or information technology are at the core of your firm’s offerings, then it’s unwise to contract out all IT knowledge. Doing so would make it very difficult to monitor and adjust your day-to-day operations for ROI and customer engagement. On the other hand, if you’re running a landscaping service, you can much more easily outsource most or all of your IT needs to cloud-based services.

Company size. Size is also an important consideration. Very small businesses – with, say, fewer than five employees – can often outsource more of their IT needs without seeing negative performance outcomes. In such small firms, the CEO is often the HR department, the accountant and the IT manager, as well. Entrusting more operations to cloud-based IT consulting services can allow business leaders more time to focus on strategic initiatives. For larger businesses, the challenge becomes distinguishing what is core to your business from what is a chore. Chores are always best done by an IT managed services provider whose business is to complete such chores.

Even though you might use an IT managed services provider as your technology department and become the most cloud-friendly business environment, there must at least be one staff contact who interfaces with the IT managed services provider. Let’s say you did outsource all of your IT work to IT consulting services. Someone in-house must still check that your various systems are playing nicely together. This position is less that of an isolated technician, as in the old order of IT managed services, and more of a strategic manager. Maintaining vendor relationships, software licensing, researching new technologies, providing a bird’s-eye view of the company’s IT setup – these are the core IT tasks of the new age. Even if most of your IT department is now made up of cloud-based vendors, someone in-house must manage the entire IT schema to ensure integration.

Of course, an IT consultant could tackle this oversight role. Many IT managed services now offer CFIOs or CIOs on an as-needed basis.

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