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In the realm of Information Technology, where regulation is absent, defining the role of an IT Provider becomes subjective. Essentially, an IT Provider is a third-party tasked with remotely managing a customer’s IT infrastructure and devices.
Given the lack of standardisation, choosing an IT Provider that adds optimal value to your business can be challenging.
They often fall into two categories: strategic partners and reactive providers, each distinguished by critical differences, particularly in billing methods.
Strategic IT Partner:
A strategic partnership with an IT provider involves a holistic approach to understanding your business, from strategic decisions at the board level to operational intricacies. This collaboration aims to align IT solutions with the broader business strategy, accounting for risk tolerance and current risk management strategies. The partnership model is built on value, and the billing method reflects this – payment is made for both the service and the value delivered.
Strategic IT is suited for businesses recognising IT as a mission-critical investment rather than a mere operational cost.
Benefits:
Risks:
Reactive IT Provider:
Reactive providers, often termed ‘break-fix’ providers, focus on fixing IT issues without deeper analysis of how IT complements the broader business strategy. Billing methods typically include time and materials (TMN) or block hours, where you pay for the hours of service or a block of time each month.
Benefits:
Risks:
Choosing Your Ideal IT Provider:
Understanding the risks and benefits is crucial when choosing an IT provider.
The ‘Riskometer’ chart above emphasises the potential risks involved. With a reactive provider, the risk is shouldered by YOU as the client, whereas a strategic partner takes on the responsibility, having been paid for both value and service.
When comparing the costs of a reactive provider and a strategic partner, avoid getting stung by ‘headline prices.’ While reactive providers may seem cheaper on the surface, hidden costs often emerge in terms of time and money. Contracts should be scrutinised for unexpected charges.
In conclusion, there is no right or wrong choice of IT provider. It’s about defining the type of Business Leader you want to be and the business you aim to build.
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