Outsourcing IT

Nicholas Carr writes: “Back when electric utilites first emerged, it was the smaller companies who led the way in hooking up to the shared grid. The prospect of avoiding big capital expenses and high labor costs, and all the associated headaches of owning a lot of specialized technology, outweighed the risks involved in moving to a new supply model. The same thing’s happening with IT today. Big companies, with lots of capital and lots of legacy systems, may be able to justify building their own internel IT utilities – they can gain considerable economies of scale on their own – but the equation’s very different for SMBs. As Berlind suggests, SMBs today would be well advised to approach their IT requirements – both hardware and software – with the assumption that they should be buying services, not assets. Sure, there’ll be plenty of exceptions, but that should be the going-in assumption. If IT isn’t your business, get out of the IT business.”

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Rajesh Jain

An Entrepreneur based in Mumbai, India.