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Simple IT benchmarking for professional services firms

   10 Jul
    Matthew Newton


With technology playing such a fundamental role in today’s professional service industry, you can’t afford to experience significant IT downtime, poor connectivity or ongoing support issues. It’s therefore vital to ensure you get the best possible service from your IT provider at all times.

Whether youre approaching the end of your current IT contract, unhappy with the level of service you receive or you just get the feeling you might be paying too much, benchmarking your IT service will help you determine whether you have the right partner in place.

In basic terms, IT benchmarking compares the performance of your IT service provider with the offerings of other services, based on a range of cost efficiency and effectiveness measures.

Ultimately, the objectives are to identify the potential for optimising your IT set-up and cost of ownership, as well as understanding how performance could be enhanced. So, even if you are relatively happy with the service you receive at present, IT benchmarking is still a worthy process to identify where there is room for improvement.

Engaging an independent third party to undertake the benchmarking on your behalf is a sensible approach, although many firms choose to conduct this exercise on their own. It can be expensive to bring in an external consultant and many partners and IT managers have procured such services at least once or twice before, so feel experienced enough to manage the process.

Whatever your situation, it never hurts to have a simple framework to work to. So in this post, well go through a straight-forward approach to IT benchmarking, with five key areas to evaluate:

 

1. Are you getting value for money?

Despite the broad standardisation of services provided by IT companies, prices vary dramatically across the board. Without benchmarking your IT service, you could be paying over the odds without even realising.

Its therefore essential to gain insight and understanding of the going ratefor IT services, and its equally important to question your own budget allocations - making sure you know exactly how and where your money is being spent.

In assessing the efficiencies of your IT budget, theres the Opex v Capex question to consider. According to the Corporate Executive Board (CEB), opex (operating expense) is expected to account for almost 80% of total IT spending by 2020. Clearly, spreading your investment in this way is a more favourable option than a capital expense model - but is your provider steering you in the right direction?

“In the last 3 years the cost of connectivity has dropped by around 25% to 30%.”

Commoditised services represent another opportunity to understand whether youre getting value for money. If you are deep into a long-term contract and havent seen price reductions on certain services during the contract period, you may well be over-paying.

Thats because some services, such as connectivity, have become commoditised over time, and their prices have naturally fallen. To illustrate this point, in the last 3 years the cost of connectivity has dropped by around 25% to 30%. If you were still paying the same rate you started with, or havent at least seen increased bandwidth for that same outlay, you can expect your price to be well above the current market average.

The ever-changing technology landscape means you may also need to look towards a fixed price-per-user model on certain services in future. Many IT services are charged per device, but most professional services users now need support for multiple devices - sending costs spiralling if youre tied into an older commercial agreement.

These are just a few examples. A benchmarking exercise will bring you up-to-date with the latest market trends around pricing and payment approaches.

 

2. What is your service experience like?

Even if the costs of your IT service are above market rate, its still money well spent if youre being provided with exceptional service. As part of your benchmarking process, youll therefore need to ascertain the levels of IT satisfaction across all users in your organisation.

As well as seeking opinions, look for hard measures too, such as average response times for issue resolution. You should also look at how many long-standing support issues you have open.

Another key area to assess is how comprehensive the service is that youre being provided with. Does your IT contract just focus on infrastructure, email and desktop related issues - or is there full support accountability for all the different software applications you use?

Often, less experienced IT partners may have you believing you are getting a good deal, compared with more expensive options. Yet, the likelihood is you are not comparing apples with apples. And be sure to look at the total cost of your IT ownership - not just the piece your IT partner is responsible for - before ruling out whether a more fully outsourced service would be better value overall.

 

3. Proactive or reactive?

A key measure of the service experience will be the level of interaction you have with your provider. Do they work alongside you in an ongoing partnership, always seeking improvement - or do they provide a solely responsive service, only seen and heard when there’s a problem?

Best practice would see ongoing network monitoring and analysis carried out by a team of network administrators, with regular reports provided on performance. A feedback score can then be tracked over time to show improvements as changes are actioned.

The provision of a Virtual IT Officer is also becoming a popular service component. They are a point of contact who will work closely with you to agree IT strategy, sharing compliance guidelines with you, giving you the peace of mind that the right advice is provided.

These increased levels of contact and support are key to keeping your networks safe, secure and performing well - so make sure youre not being sold short.

 

4. How strong is your IT partner’s security capability?

The importance of IT security is increasingly being recognised across the business landscape. Spending in this area now accounts for 4.5% of IT budgets (up from 2% in 2012), according to the CEB.

While this is still a relatively modest slice of the cake, further increases are expected to accelerate. Investment in this area provides no real growth benefit, but it should ensure the very damaging ransoms, fines and indirect costs, such as loss of reputation or indeed clients, are minimised.

Security and data governance are particularly relevant to professional services firms, so security capability should now be a major criteria when selecting your IT partner.

 “IT security now accounts for 4.5% of the overall IT budget, up from 2% in 2012 (Source: CEB).”

So, scrutinise your providers approach to security in detail. Do they provide ongoing advice on the appropriate steps you must take to increase your protection from emerging threats? Do they take a modern, multi-layered approach to security - including Umbrella Open DNS, password management, penetration testing and next-generation firewalls? Are they able to advise you on the steps you can be taking to ensure you are prepared for GDPR? And can they provide you with an independent Cyber Essentials assessment?

If benchmarking shows other providers to offer better security solutions, a change of IT partner may well be in order. With the increasing threat of cyber attacks and growing risk of non-compliance, the level of sophistication needed to support your business in this area is much greater than ever.

 

5. Could things be easier?

Last but by no means least, will your IT benchmarking process take into account the simplicity of your current solution and the service experience you receive?

For instance, how much of the IT maintenance burden do they remove from your plate? How easy does your service provider make life for your users? Do they take full responsibility for any problems or fixes required, even outside of their remit? How friendly and patient are they with your team? Do they take time to explain things in language you can understand?

The bottom line is you shouldnt have to be IT experts to understand your IT support partner if it feels strained or difficult, things arent right.

 

In summary

The outcome of your IT benchmarking exercise may lead you to determine that you should be getting a much higher level of service for a lower rate. Sadly, even in this situation, many firms still decide to stay with their incumbent provider because of the perceived disruption and cost associated with switching. So, ensure that you look to see what a potential new partner might be willing to offer to minimise the cost and hassle of moving to them. You might be pleasantly surprised.  

Benchmarking your IT service will likely reveal a number of areas for improvement - and whether it leads to a change of provider or not, your organisation will be all the better for lifting the lid on the service you receive. Use the review as an opportunity, not just to improve commercial terms, but to also reduce unnecessary operational and technical complexity. Not only will this make life a little simpler for your team, you could also make considerable savings through increased efficiencies.

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Matthew Newton

About The Author

Matthew Newton

Operations Director, Oosha

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