London-based easyCar is one of Europe's fastest growing car rental companies; it opens two new locations a week. easyCar customers, who are located in the U.K., France, the Netherlands, Spain and Switzerland, book their rentals online 95 percent of the time. With such a strong Internet business, Web site availability and speed are critical to this company.
As 2002 loomed, problems in this essential area threatened the rapidly growing firm. The managed service provider (MSP) that had been servicing easyCar was not up to the task of keeping its over-taxed Web site running efficiently. "My efforts were going into making sure the site was available and resolving problems with the Web host," reports Chris Branagan, chief technology officer. Something had to be done fast and done right. The answer was a new system and a new Internet operations partner with the expertise to run the Web site.
Do What You Do Best, Outsource the Rest
Branagan says easyCar did consider doing it in-house but quickly ruled out that option. "Outsourcing leverages economy of scale and offers more expertise than we would be able to employ here," he says. "That allows us to focus on our core business."
According to Stephen Lane, research vice president, IT services at Boston, Massachusetts-based Aberdeen Group, "Infrastructure operations and application maintenance costs, which typically consume more than 80 percent of corporate IT budgets, are an obvious target for outsourcing, especially in the current economy. Moreover, business and IT decision makers are taking a much closer look at what is core to their business and what is not."
Aberdeen's 2002 report, "World IT Spending 2003-2006: Measuring the Incremental Recovery," demonstrates IT outsourcing's direction:
The Aberdeen consultant says "there is no reason for a company to specialize in infrastructure and network areas, especially when there are others who can do the job better, faster and cheaper."
easyCar's plan was to find not only a new system to purchase, but also a service provider who could run the seven-figure system. After evaluating proposals, easyCar selected Attenda of Middlesex, U.K. Founded in 1997; Attenda impressed Branagan because it "concentrates on a fully managed service as opposed to selling data center space."
Neal Gandhi, vice-president of product marketing and management of Attenda, says the company does a lot of the design work in the pre-sell stage. "We understand how the applications work and what the business requirements are from an availability and performance perspective. We design, then build the architecture and a migration plan from where they are," he explains.
easyCar signed the outsourcing contract In January 2002. Attenda built the boxes, did the load balancing and tested them to ensure they were secure. The provider planned the data migration. Gandhi says, "The most difficult part was the data integrity." He reports the migration took six weeks "with no real glitches along the way."
The new host ran parallel with the existing host to test the site. Branagan was pleased with the transition. "It was quite smooth," he says, pointing out Attenda already had similar systems running elsewhere. It took just two months from signing the contract to going live.
Increasing Business and Performance
With the business rapidly growing, service and speed are paramount, according to Branagan. "The re-launched site has reduced the time to make a booking by as much as 70 percent. We are getting a lot more transactions through the site than we were previously. The real benefit to us is that the site is quicker," he reports. Even better, the cost is less than with the previous provider.
Branagan says the two parties work together to improve his business with Attenda monitoring infrastructure performance and capabilities as easyCar updates its applications. "We never stop developing. We are always enhancing the applications to reduce the booking time," he says.
easyCar has grown to 60 locations, up from 41 as recently as December 2002. The new infrastructure is more than up to the task. In addition, easyCar has never been hit with a virus or been hacked since going with Attenda, thanks to its continuous security and vulnerability assessments.
Branagan is contented. "The major benefit is that I can actually focus on the business rather than on Web site availability. We know that we can trust Attenda to do that for us. Its ability to take 100 percent ownership of the site allows us to get on with doing what we do best - running a competitive, reliable and customer-friendly business."
IT Outsourcing Growth to Continue
Lane notes that outsourcing is expanding beyond infrastructure operations because business today requires new skills and places different responsibilities on business and IT executives. "Just about any IT activity that can be done cheaper and better by a trusted third party is on the outsourcing block," he reports.
In addition, he believes the shift toward IT outsourcing is "unlikely to be reversed, even when the global economy turns around." He explains worldwide hardware expenditures will increase only 8.3 percent from 2002 to 2006, while services will increase 17.7 percent over the same time period.
Lessons from the Outsourcing Journal:
- Outsourcing to an MSP ensures reliability for an enterprise heavily dependent upon eCommerce.
- Outsourcing to an experienced service provider is crucial when a business is growing rapidly.
- Outsourcing to an MSP allows key personnel to focus on strategic business objectives without IT diversions.