The title of this article may seem a bit harsh, but it’s unequivocally true: choosing a technology service provider based on geographical proximity is almost always a very bad idea.
Knowledge-based services are difficult enough to find at all, let alone finding the best potential skills, experience and price. Adding artificial and unnecessary constraints to limit the field of potential candidates makes your search that much more difficult.
With the rare exception of major global market cities like New York City and London, it is nearly impossible to find a full range of skills in Information Technology in a single locality, at least not in conjunction with a great degree of experience and breadth. This is true of nearly all highly technical industries – expertise tends to focus around a handful of localities around the world and the remaining skills are scattered in a rather unpredictable manner, often because those people in the highest demand can work and live where they want to, not where they have to.
More than nearly any other field, IT has little value in being geographically near the business that it is supporting. Enterprise IT departments, even when located locally to their associated businesses and working in an office on premises, are often kept isolated in different buildings away from both the businesses that they are supporting and the physical systems on which they work. It is actually very rare that enterprise server admins would physically ever see their servers or network admins see their switches and routers. This becomes even less likely when we start talking about roles like database administrators, software developers and others who have even less association with devices that have any physical component.
Adding in a local limitation when looking for consulting talent (and in many cases even internal IT staff) adds an artificial constraint that eliminates nearly the entire possible field of talented people while encouraging people to work on site even for work for which it makes no sense. Working on-site often incurs a large increase in costs and loss of productivity due to interruptions, lack of resources, poor work environment, travel or similar. Working exclusively or predominantly with remote resources encourages a healthy investment in efficient working conditions that generally pays off very well. But it is important to keep in mind that just because a service company is remote does not imply that the work that they will do will be remote. In many cases this will make sense, but in others it will not.
Location-agnostic workers have many advantages. By not being tied to a specific location you get far more flexibility as to skill level (allowing you to pursue the absolute best people) or cost (by allowing you to hire people living in low-cost areas) or simply offering flexibility as an incentive or get broader skill sets, larger staff, etc. Choosing purely local services simply limits you in many ways.
Companies that are not based locally are not necessarily unable to provide local resources. Many companies work with local resources, either local companies or individuals, to allow them to have a local presence. In many cases this is simply what we call local “hands” and is analogous to how most enterprises work internally with centrally or remotely based IT staff and physical “hands” existing only at locations with physical equipment to be serviced. In cases where specific expertise needs to be located with physical equipment or people it is common for companies to either staff locally in cases where the resource is needed on a very regular basis or to have specific resources travel to the location when needed. These techniques are generally far more effective than attempting to hire firms with the needed staff already coincidentally located in the best location. This can easily be more cost effective than working with a full staff that is already local.
As time marches forward, needs change as well. Companies that work local only can find themselves facing new challenges when they expand to include other regions or locations. Do they choose vendors and partners only where they were originally located? Or where they are moving to or expanding to? Do they choose local for each location separately? The idea of working with local resources only is nearly exclusive to the smallest of business. As businesses grow, the concept of “local” begins to change in interesting ways.
Locality and jurisdiction may represent different things. In many cases it may be necessary to work with businesses located in the same state or country as your business due to legal or financial logistical reasoning and this can often make sense. Small companies especially may not be prepared the tackle the complexities of working with a foreign firm. Larger companies may find these boundaries to be worthy of ignoring as well. But the idea that location should be ignored should not be taken to mean that jurisdiction, by extension, should also be ignored. Jurisdiction still plays a significant role – one that some local service providers or other vendors may be able to navigate on your behalf allowing you to focus on working with a vendor within your jurisdiction while getting the benefits of support from another jurisdiction.
As with many artificial constraint situations, not only do we generally eliminate the most ideal vendor candidates, but we also risk “informing” the existing vendor candidate pool that we care more about locality than quality of service or other important factors. This can lead to a situation where the vendor, especially in a smaller market, feels that they have a lock in to you as the customer and do not need to perform up to a market standard level, price competitively (as there is no true competition given the constraints) or worse. A vendor who feels that they have a trapped customer is unlikely to perform as a good vendor in the long term.
Of course we don’t want to avoid companies simply because they are local to our own businesses, but we should not be giving undue preference to companies for this reason either. Some work has advantages to being done in person, there is no denying this. But we must be careful not to extend this to rules and needs that do not have this advantage nor should we confuse the location of a vendor with the location(s) where they do or are willing to do business.
In extreme cases, all IT work can, in theory, be done completely remotely and only bench work (the physical remote hands) aspects of IT need an on premises presence. This is an extreme view, and of course there are reasons to have IT on site. Working with a vendor to determine how the best service can be provided, whether locally, remotely or a combination of the two, can be very beneficial.
In a broader context, the most important concept here is to avoid adding artificial or unnecessary constraints to the vendor selection process. Assuming that a local vendor will be able or willing to deliver a value that a non-local vendor can or will do is just one way that we might bring assumption or prejudice to a process such as this.
There is always a possibility that the local company will do the best possible job and be the best, most viable vendor long term – but the chances are far higher than you will find the right partner for your business elsewhere. It’s a big world, and in IT more than nearly any other field, it is becoming a large, flat playing field.