A recent report by the ESRC Research Centre for Charitable Giving and Philanthropy at Cass Business School ”Scoping the Charity Outsourcing Market” concluded that the charity sector is missing out on potential significant savings through not considering IT outsourcing. This was reported to be largely due to avoidance of risk and lack of information. The study consulted with 450 charities with between £1m and £10m annual turnover.
Our experience at IndigoBlue is that IT outsourcing is actually part of a larger picture - that charities are often small-to-medium size organisations in which IT has a disproportionally large impact. So, charities of the £1m-£10m annual turnover size would not normally be able to justify employing a full-time IT Director, but their website and membership/donor database are central to their business and there is a danger that poor IT can impede delivery of the overall business strategy.
Organisations like the AAT, however, have been able to transform their businesses, with IT being a catalyst for business change. The AAT has access to an appropriate level of IT expertise, utilising a part-time IT Director. This resource has helped the AAT to dramatically change their methods of interacting with their members, so that they are now predominantly an online organisation.
In most cases, the web is much more important than IT outsourcing in the role it plays in enabling (or impeding) a charity’s overall strategy. It is important that all parts of the organisation are able to be responsive in changing content, that the website infrastructure supports rapid (and cost effective) development of new features and provides the facilities needed to support interaction with supporters / members.
Turning to IT outsourcing, the business case for, or against, outsourcing IT services needs to be considered as part of the overall strategy for IT. In some cases an outsourcing supplier will be able to simplify the IT infrastructure and deliver significant cost savings. Elsewhere, if the IT department is of the appropriate size and delivering the services needed, there can be great advantages to keeping an in-house team. The potential benefit of an in-house team is the deep knowledge of the organisation and how it operates.
If outsourcing is being considered, it is important to select the right partner, with an understanding of the sector, with the expertise required and the ability to deliver the appropriate level of service, in the right locations.
