The Next Wave of Outsourcing: Remote Infrastructure Management

July, 2008


For business leaders across industries, in the early days of IT infrastructure outsourcing, the exercise involved overcoming fear of the unknown and managing a perceived high level of business risk. Towards the end of the first decade of the 21st century, only about 50 percent of IT resources in global organizations were engaged in managing the various elements of IT infrastructure remotely. The perceived higher risks in managing and maintaining enterprise IT environments remotely led to a resistance to sending out the core IT functions to offshore geographies. This mind-set, however, started changing over time and was triggered by the convergence of three independent forces — the rapid evolution in remote server-management technologies and IT architectures, changes in customer behaviours and demand patterns, and growing maturity of the offshore service delivery model. With growing pressure to optimize and manage cost on IT spends, limited resourcing and staffing options and an ever increasing competition, business leaders had to overcome the fear and take the leap of faith to gradually outsource their in-house infrastructure management operations to remote low cost delivery locations. The trickle of infrastructure outsourcing a decade ago has today become a flood, as the sustainable benefits of infrastructure outsourcing has led to the service becoming an over US $500 billion market; a quarter of US IT spends. The continuous efforts by organizations to lower costs and enhance performance levels, technological advancements leading to improved efficiency and service coverage, and most importantly, an accelerated evolution and scale up of offshoring and remote capabilities has led to a rapid growth in the adoption of Remote Infrastructure Management (RIM) services. Decision on RIM is no longer driven by a leap of faith; it has become a logical next step.