Last week I spoke to two CFOs that had the same concerns, but from very different aspects. Both CFOs work at high growth companies that have gone from 10 to 50 employees in the last few years and each company plans to grow well above 100 employees. Not surprisingly, around the 50-person mark, each of them was looking at their next steps regarding IT. Because of my series on Hiring IT, these CFOs reached out and asked me to look at their specific IT situations, then give my thoughts on what they should do next. I started out by asking each CFO what concerns with IT they had.
One of the CFOs was considering hiring the company’s first internal IT professional because they were outgrowing their single IT guy’s capabilities and he was stretched too thin because he had a dozen other clients. The other CFO was looking to outsource the IT for the first time, taking that burden off one of the company's senior executives that adequately handled it when they were smaller, but now is in over his head. To my surprise, each had the same concern – a fear of losing control and confidentiality. Even though they were looking at two different avenues of solving their technology needs (hiring versus outsourcing), each had the exact same concerns. I thought I’d continue my Hiring IT series to address their concerns, especially since this isn’t the first time I’ve heard them.
Executives never want to feel that they aren’t in control of their company and because of IT’s role, it could possibly fall into the wrong hands without proper checks and balances in place. (This is also why I require drug screens and background checks for all employees. A technician can bring a company down, so why not spend the $200 to validate their stability?)
- Concerns of Losing Control with Internal IT – Many executives trust their IT teams unconditionally, especially when they’ve been with the company for years (which is a good thing), but IT has admin access to every system from accounting to security that gives them more "power" than the CEO.
- Concerns of Losing Control with Outsourced IT – Some executives are concerned that they could be at the mercy of their IT firm for their admin-level passwords to their systems and other restricted information.
Just like you need certain checkpoints to ensure your accountant isn’t embezzling or mismanaging money, your IT team needs similar checkpoints like periodic IT assessments. These checkpoints can help build a better relationship with IT as well.
One best practice in IT is to provide the ownership group or executive team with admin-level passwords regardless if IT is outsourced or internal. A good IT firm or IT professional will not fight you on this request. With these passwords in hand, executives are able to modify or remove access when necessary (e.g. remove a system admin when firing an internal IT professional or an IT firm.) Having an admin-level password to the servers (especially the domain controller) and other key items allows executives to have third-party assessments completed to uncover any potential problems, which will help put their mind at ease that everything is up to par.
Secondly, a good IT firm or IT professional will heavily document your network, IT processes, and configurations. Documentation is where larger IT firms shine because they need detailed records of your environment and processes to have another team member step in to do a task at any time. With any position in your company, especially in IT, you need redundancy and documentation in case your main person is “hit by a bus”.
Executives need to protect the company’s interest including their data, financial records, and proprietary information. Although IT has access to every system and database on your network, they shouldn’t need to access confidential material to do their jobs.
- Confidentiality Concerns with Internal IT – Most executives don’t worry as much about employees stealing data because they trust their employees. Instead, they fear IT reading sensitive emails like information about layoffs, bonuses, or about employees. Because internal IT teams know employees personally and the office politics, a non-executive having insider information can be dangerous to the entire company.
- Confidentiality Concerns with Outsourced IT – Most executive's biggest fear outsourcing IT is the IT firm leaking sensitive information to competitors because most IT firms work with competing firms. The concern of an outsourced IT team reading emails is moot because IT technicians don’t have the interest (or the time) to read clients’ emails.
Protecting Your Confidentiality
You can protect your company with non-disclosure agreements (NDA) and other legal agreements (such as an At-Will employment agreement), regardless if the individuals are from a good IT firm you contract with, or an individual IT professional you have hired.
To Prevent These Challenges, Should I Hire IT Internally or Outsource IT?
You probably think I’ll always say companies should outsource their IT since I run an IT firm, but the answer to this question depends on the situation. Some companies need someone on-site all the time or have key personnel that need extra attention, so having an in-house IT person on payroll makes sense. Most companies do not have these needs and it is more cost-efficient to outsource IT, with the added benefit of an IT team supporting their needs.
Also, when a company gets to 50-70 employees, they can reasonably consider a hybrid approach where they hire an in-house IT professional while also contracting a good IT firm. The in-house IT professional will handle taking care of the infrastructure (network and servers), managing projects, and learning more about how the company operates so they can recommend IT strategies to move the company IT infrastructure forward. The IT Firm will handle the day-to-day help desk support (and bring the toolset needed to do this at a high level too), assist with implementing projects, and provide the in-house IT professional with peers who can give him support and guidance. In my opinion, having both an internal IT and outsourced IT team provides a winning combination that can give you the checks and balances your company needs.
A good IT firm should be able to help you evaluate what is the best option for your company and, if needed, help you hire the right IT professional since most CFOs are not knowledgeable in hiring IT staff.