As a technology leader of a progressive business firm, managing business applications, it must be demanding to handle the rapidly evolving needs of business and ensure that technology remains aligned with the business. With budget constraints, skilled resource scarcity, and the need to have a flexible capacity, Technology leaders often find it hard to figure out what to keep in-house and what to outsource.
While there is no right answer and no cookie-cutter solution to this, we have laid out the pros and cons of each in the hope that it would help you decide what makes sense in the context of your business. We have discussed this largely in the context of managing and maintaining Salesforce as it presents additional challenges given how quickly their products and platforms evolve.
Advantages of having an in house team:
Greater alignment to business
Inhouse teams naturally have a strong understanding of and alignment with the company and business stakeholders which is perhaps the biggest advantage. A strong team will be able to help business leverage the best of what Salesforce has to offer and work closely with stakeholders to enhance value and ROI from spend on Salesforce.
Lower Operating Costs
In house teams are most likely to be less expensive than outsourcing to Salesforce partners given the market prices for Salesforce services. Of course there are lower cost outsourcing destinations, but they come with some challenges too!
With no external dimensions involved or resources outsourced, you are free to utilize the existing team efficiently and flexibly. There are fewer constraints in terms of moving resources across projects and using them internally in a fungible manner.
The capability of the inhouse team will be limited largely to the capability of the individuals in the team and if there is a need for a skill set that the team doesn’t have – e.g. Marketing cloud or CPQ for example, it would leave the company with little choice but to look outside. Given the pace at which Salesforce products are evolving, it is a challenge to keep the team trained and up to date. Salesforce partners will generally have a wider range of skills available amongst their team given the variety of work they typically handle.
Given the demand for skilled Salesforce resources in the market, it is a hard problem most companies face in trying to retain talent. Even if companies satisfy the compensation expectations of skilled resources, it is difficult for companies (particularly mid-sized ones) to provide the kind of width of experience and exposure that a Partner firm or a Large Enterprise using the full stack of Salesforce products can provide.
If the volume of work that needs to be done varies considerably and the time to market is critical for business for enhancements and changes, it is a challenge to right-size the in-house team. Outsourcing may offer greater flexibility to scale teams up or down at short notice based on demand.
We looked at the Pros and Cons of maintaining an in-house team, let us now look at the advantages and disadvantages of outsourcing.
Benefits of Outsourcing
Salesforce partners generally bring a wide range of skill sets and expertise across all of Salesforce products as well as deep experience in implementing and managing Salesforce. This is especially true of mid-sized and large partners who have been around for a longer period than the newer ones.
Flexibility to Scale
With Partners it is much easier to enter into an arrangement that allows you to flexibly scale resources up or down at relatively short notice. Engagement models that are purely based on a Time and Material billing is also possible, allowing you to have right sized capacity based on need.
Experienced Salesforce partners bring learning from a wide range of experience and from interactions with the general Salesforce ecosystem ( or Ohana as they call it) and are able to bring best practices and innovative ideas to the table.
AND OF COURSE THE CONS ARE THERE TOO:
Unlike in-house teams who have a relatively deep understanding of your business and Salesforce org(s), external vendors will need a lot more communication overhead to explain business requirements. If there are timezone and language differences this can lead to considerable angst.
Of course with time vendors become more familiar with your business and Salesforce instance and this overhead reduces to acceptable levels.
Security and Business Risks
There are greater risks in entrusting your Salesforce managed services to an external partner which includes business risks related to the partner as well as information security-related risks.
Higher Management Overhead
Working with external partners does lead to increased management overhead and it is important to ensure that the overheads don’t offset the benefits of outsourcing.
Well, it does seem to be a bit of a Hobson's choice, but there are ways to resolve this based on the business context and needs. One does not need to really decide just one way or the other and opt for a hybrid model of having a small in-house team that works with an outsourced partner.
There are clear paths to building successful partnerships that bring the best of both worlds but detailing the models out is outside the scope of this blog.
Click here if you have specific questions related to this topic. We will be happy to help.