An Email Service Outsource is $5,000 while a Power Plant large enough to run a 100
person business probably costs $250,000 not including installation and diesel
delivery. Most businesses do run their own Email Service Outsources while extremely few
businesses run their own in-house banking. If anyone actually believes that
these things somehow equate to each other, then you’re a salesman’s best friend
and I’d like to sell you some ocean front property in Nevada.
Only prejudiced people are against outsourcing:
Phil Wainewright suggested that people who are for running Email Service Outsources
in-house are "prejudiced". The fact of the matter is both JMJames and I work for
IT outsourcing firms that make lots of money selling outsourced Email Service Outsources.
If we were "prejudiced", it would be in favor of outsourced Email. The truth of
the matter is, I would love for you to outsource all your Email Service Outsources to me
because it is a very lucrative business and I would start my own business
tomorrow if I had more than a few hundred users willing to sign up. I would make
more money in a single month than if simply had offered my consulting services
to build an Exchange server for you.
Insourcing doesn’t account for overtime:
Phil Wainewright suggested that insourcing doesn’t account for staff overtime.
Hearing this from an outsourcing proponent had me rolling on the ground
laughing. I think it’s time that I let every one in on a little secret. Only
businesses that outsource their IT work pay overtime and companies that insource
IT work usually pay nothing for nights and weekends because their staff is
usually on salary. When you pay that outsourcing firm one and a half times $150
per hour for night and weekend work, understand that the people who actually do
the work during their usual off hours get zero, zilch, nada and the outsourcing
firm pockets the money. This is the dirty little secret in outsourcing where
firms make a killing in profits and the losers are the workers and the clients.
Insourcing doesn’t account for monitoring:
Phil Wainewright suggested that insourcing doesn’t account for service
monitoring. I say you don’t have to because any business has to have their own
monitoring system anyways to monitor their servers, routers, switches, and
firewalls. Lots of businesses I know of rely on a cheap and simple combination
of Whatsup and Solarwinds or MRTG. Even if you did outsource something like CRM
to Salesforce.com, would you really trust Salesforce.com to do your monitoring
for you when they wouldn’t even admit they had some severe outages? Even though
Salesforce.com started a new website to report uptime, it still makes good sense
to verify.
In-housed Email results in smaller mailboxes:
Dion Hinchcliffe says that in-housed means smaller mail boxes, but I say
nonsense. Hard drives (and hardware in general) are the cheapest aspects of IT.
Outsourcing proponents like Sun wants you to think of storage as electricity.
Sun would have you believe that it’s better to pay $300 per month for 300 GB of
storage rather than buy 300 GBs of redundant RAID storage for a one time fee of
$300 plus a few dollars per month in electricity.
In-housed Email results in less accessibility:
Dion Hinchcliffe says that in-housed means less accessibility. I’m wondering if
Dion has ever built an Email Service Outsource and what makes him think that an in-house
Email Service Outsource is any different from an off-site server (I almost wanted to say
out-house server because it would probably be an accurate description of the
performance of an off-site Exchange server). Microsoft Exchange 2003 has Outlook
anywhere capability where Outlook 2003 just connects to Exchange without any VPN
service and it can bypass just about any firewall or proxy restrictions.
Exchange 2003 SP2 added significant enhancements for mobile devices like Palm
and Windows Mobile. While there are bad IT departments that refuse to adopt
technological progress, forward thinking IT departments will jump to implement
these features. If a business is faced with an IT department that refuses to
adopt technological advancements to improve productivity, then it’s probably
time for the IT leadership to make some staffing changes or it’s time for the
business to consider new IT leadership.
Speaking of accessibility, one thing that the outsourcing proponents will NEVER
mention is the speed of the server. Anyone who’s ever tried to use an Exchange
server who deals with large attachments via an Internet connection would tell
you that the experience stinks. Forcing 20 or more people to use a remote
Exchange server is just dumb. No off-site server can compare to the performance
of a cheap gigabit server on the LAN.
The issue of server uptime:
Dion Hinchcliffe says that in-housed means less Email uptime. As someone who
designs Email systems, I can tell you that keeping an Email Service Outsource running isn’t
rocket science. Microsoft Exchange 2003 is almost zero management since user
management is mostly done from the Active Directory and all it really needs is
an occasional patching and some database maintenance. Outsourced firms can
easily manage a hundred Exchange servers with a few Exchange administrators that
rotate shifts. You can have as much uptime as you want but it will cost a lot
less to run in-house.
In-house Email Service Outsources cost more:
All the outsourcing experts say in-house Email cost too much. As someone who
built these systems for a living, I can authoritatively tell you that it isn’t
true. An Exchange server for 100 people shouldn’t cost more than $6000 in
hardware and that’s for 3 dual-core servers which include 600 GBs RAID storage
plus $10,000 in server and client licenses but the hardware and software costs
can be spread across 4 years. As for the costs of labor, it should be minimal.
For a small business with less than 100 people, the administrator who runs the
Windows servers probably runs the Exchange server as well. At most, an Exchange
expert might have to be brought in to design and build the system, but it really
doesn’t take much to do routine administration.
When factoring wages in the decision to outsource or not, a business has to ask
itself if it actually intends to lay people off in the event that they do decide
to outsource. The fact is that an IT person probably spends less than 10 percent
of his time managing an Exchange server so it’s highly unlikely that a business
will save on head count. If they can save on head count, there were staffing
inefficiencies in the first place that could be addressed without resorting to
the outsourcing of Email. In the case of a really small business with less than
20 people, there are plenty of companies that will provide cheap remote
management of an in-house small business server. When you consider all the
alternatives, it just doesn’t make any sense to pay $45 per user per month for a
severely bandwidth-constrained off-site Email Service Outsource..