Outsourcing Requires Virtualization, Self-Recognition, Says Discovery CIO

Outsourcing without taking steps such as virtualizing and consolidating IT infrastructure can merely result in an internal mess being transferred to an outside provider, Discovery Communications CIO David Kline says at an outsourcing conference in New York. It is also important for a company to know its limitations, cost and structure when outsourcing. The mere mention of the term is guaranteed to cause emotional debate among IT workers.

NEW YORK-During a keynote address at the Global Sourcing Forum and Expo here on Nov. 11, Discovery Communications CIO David Kline suggested that any companies wanting to outsource their IT assets would do well to virtualize, streamline and otherwise render shipshape their organizations before the transfer.

"If your mess is a mess, and you turn it over, it's still going to be a mess," Kline told the assembled audience.

"You could do an offshore ... where your management staff is saying, 'It's over there. It's not my problem anymore.' And that's not true. IT's still your mess. Get it as clean as you can get it," Kline said. "Know yourself. Know your limitations. It is a huge proposition to do global sourcing."

Virtualization and consolidation, apparently, are key to getting a company's IT infrastructure "clean" for outsourcing.

When Kline joined Discovery, he was tasked with helping CEO David Zaslav reduce work force and increase the company's IT efficiency. As part of that, he said, "We had to 'rightsize,'" reducing IT employee count from nearly 600 to around 200. Kline also restructured Discovery's global IT network, the hubs of which in Asia and Europe operated on a different infrastructure of standards than in the United States.

Part of Discovery's process in outsourcing involved determining who among of the physical staff had to be located in a specific place because of a job, eventually transferring some staff to other locations in order to save money. On a broader level, the company also restructured its infrastructure organization on a follow-the-sun model, with teams in Europe, Asia and the United States trading off in 8-hour periods throughout the day.

But even more vital, Discovery learned, is a combination of having effective governance processes in place to manage the relationship with outsourcing vendors, and understanding the costs and processes within a system.

"The real value that global sourcing brings is the competitive edge of flexibility that lets enterprises toggle up and down and ride out these unpredictable storms," Kline said, citing Amazon.com and Salesforce.com as examples of enterprises that could emerge from the global recession in a stronger position thanks to reshaped corporate infrastructures.

Companies considering whether to outsource their IT jobs will also need to consider the security implications. In a Sept. 29 report commissioned by VanDyke Software and conducted by Amplitude Research, 61 percent of 350 IT professionals surveyed reported an unauthorized intrusion in their outsourced systems within the past two years. By comparison, about 35 percent of respondents working for companies that kept their infrastructure in-house reported an intrusion.

Whatever a company's ultimate decision on whether to outsource its infrastructure, the very mention of the term outsourcing is all but guaranteed to cause an emotional debate among U.S.-based IT workers.