Outsourcing network management: what was once seen as a cost-cutting tactic may now be a smart strategic decision - The Bottom Line

Communications News, August, 2002 by Lenny Liebmann

Discussing outsourcing in a magazine for network managers is always a little dangerous. The topic itself puts many people on the defensive, since they think it implies that they are just not very good at what they do. Unfortunately, that attitude results in a self-fulfilling prophecy. Those who think that outsourcing will cost them their jobs--and who therefore oppose it--are often the first to be let go once an outsourcing initiative is under way. Those who embrace and understand outsourcing, on the other hand, are more likely to survive such a transition.

How can a corporate network manager learn to embrace such an apparently threatening phenomenon? Two helpful steps are to understand what outsourcing is and what outsourcing is not.

Outsourcing is not a negative verdict about the competency or character of network managers. Network managers can be very good at what they do, and still find their companies outsourcing network management.

That is because there are certain attributes that even the most competent in-house network management staff cannot bring to the table. In-house staffing does not offer any economies of scale.

And then there are political issues. For example, an internal network manager may have a tough time getting a bunch of executive VPs to buy into standardization of the corporate IT infrastructure. An outside vendor will not any into similar pecking-order issues.

Many outsourcers also possess highly specialized skills that most in-house teams will never develop--such as analyzing data from an intrusion-detection system or using application-performance modeling tools to create what-if scenarios for network planning. These are skills that would not make sense for an in-house team to develop because they do not need them very often.

An outsourcer, on the other hand, can amortize those same skills across a large number of different client engagements. A company seeking to gain access to such skills has two choices: hook up with a separate consultant for each one, or find an outsourcer who offers them all in a single package.

Outsourcing can thus be seen as a strategy for accessing a broader range of skills and changing the politics of decision making, as well as a way to simply save a few bucks on payroll.

The question that network managers need to ask themselves, therefore, is not how they can prove that they are more competent technically than a potential outsourcer's staff. The question is whether outsourcing is the right strategic move for the company--and, if so, how they can play a useful role in the outsourcing engagement.

Outsourcing nowadays rarely involves the wholesale replacement of all in-house staff. Outsourcers, in fact, are becoming increasingly flexible in how they structure their engagements. They are too hungry for business to play an all-or-nothing game. Instead, they increasingly use a needs- and objectives-based approach to structuring their deals. That can be advantageous to a network manager who knows how to play the game.

The most important point is not to take an adversarial position about the engagement. Antagonism and resistance are not sought-after qualities in any partnership. Leaning on technical skill alone to make yourself indispensable also is not that wise. No one really cares about who can out-geek whom.

A better tact is to dearly demonstrate an understanding of the business case for outsourcing and provide insight into some of the potential difficulties of transition. That is what will make you indispensable at the front end of the engagement. It also will help you build good working relationships with the outsourcer--which is what will keep you in a strong position moving forward.

As companies try to get leaner and meaner, outsourcing is likely to become increasingly appealing. Being a good network technician will not provide much job protection in this environment. Understanding and supporting smart business decisions will.

Liebmann is an independent consultant specializing in the application of networking technologies to strategic business challenges. Send comments for pubilication to liebmann@comnews.com.