What advice would you offer IT leaders for insourcing?

Question

Answer

I like to call it right-sourcing: You have folks who are highly talented, but they’re in the wrong job. You have to find where they are and identify them. The effort required to find the right resources has always been a challenge. Even if you decide to outsource, it is a challenge whether they're trusted, economical or otherwise. A buddy of mine had to staff up two different development platforms, and they wanted to find something economical that fit their culture and model. They blasted out roles, but they didn't hire a single person. I said, &#34;Where's the problem? You just had 300 people apply and you couldn't hire one.&#34;

Answer

We came to San Francisco to do a startup because that's where you go to do that. It’s kind of like going to Hollywood to be an actor but there are practical reasons to do it, too. We soon realized how economically irrational this place can be with respect to talent. There's so much going on that you can end up overpaying for a lot of different things that may not need to be located here in the first place.

That triggered a right-sizing exercise for us, because we had this critical mass that we'd established in San Francisco and it didn't make sense for us to continue growing here. But then we had to decide how we would carve pieces off: Is that something that we do as a center of excellence (CoE) activity around particular verticals, so we can have this center that can cross pollinate and collaborate? Or is it fully distributed? We've done different things for different business components. The triage and the support teams, for example, are all around the world because so are the security researchers and our customers. Whereas, for certain aspects of core development, the data team, and the CEO, it made sense for those pieces to be hived off together.

It’s a matter of figuring out how you can pick things apart. It’s similar to working with Ruby-based startups: You tend to end up with a monolith that you have to pick apart and turn into a service-oriented architecture over time. It's a pain, but just about everyone has to go through that process because Ruby's so good for prototyping. There's a similar principle in play with insourcing, especially at a rapid-growth company.

Answer

Make sure you have a good tier model set up in your contract with the outsource provider. I'm going through an insourcing journey and, as I'm training and onboarding my staff, I'm also supposed to be driving down the number of cases that are being handled by my outsource provider. Unfortunately I didn't have the right tier model set up in the contract as I stepped down, so I stepped down, stepped down, and then went off the cliff. But that just means that I need to step up, step up, and then jump really well. And I'm not doing it myself; I've also got a training program that I've outsourced.

Answer

Build a well-skilled team that understands the business objective and knows the technology so it can manage it successfully to achieve the business objectives.

I love doing stuff internally with my team vs outsourcing it, but it requires a lot of investment in hiring the right people, training and motivating them to keep up and do a good job. Sometimes it's easier to say to a 3rd party, here is XXX $ and do that job. I don't care who does it as long as the results are there.
When you are doing things internally, you are that 3rd party, and you need to rely on your team. You need to trust and empower them. Depending on the technology and human capital you have, it might take some time to build a good team, but once you have it... they can move mountains and do things much faster than any outsourced party/external consultant.

What advice would you offer IT leaders for insourcing?

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