To navigate the increasingly complicated IT waters and alleviatepressures associated with tougher compliance exams, a growing number of credit unions areturning to managed services providers.

For example, Red Rocks Credit Union in Highlands, Colo., relieson Computer Services Inc. to manage the $230 million institution'sservers and online help desk.

Also Read: Strategic Planning Eases IT Budget Headaches

In addition, CSI of Paducah, Ky., provides strategic IT development supportand remote, around-the-clock monitoring of the Red Rocks networkthrough its Cisco Systems adaptive security appliance, a firewallthat's configured with an intrusion prevention system.

“It would be impossible to paysomeone internally to provide the same level of expertise theyoffer,” said Teresa Trostel, director of IT at the credit union inHighlands Ranch, Colo.

By partnering with CSI, Red Rock has significantly improved theIT planning process and alleviated anxiety related to FFIEC exams,Trostel said.

“We'll brainstorm with CSI's team and debate: “Is this is thedirection we want to go? What is best way to get there?” That's anextremely important part of the relationship,” she added.

Providing IT planning advice is a crucial part of thepartnership, said Dan Holt, president and general manager of CSI'smanaged services division.

“Credit unions shouldn't have to worry about an infrastructurethat holds them back,” Holt said. “CSI helps credit unions tobetter utilize current investments in technology and identify wherenew investments would be the most cost effective.”

“Many times we find that changing business processes willaddress inefficiencies without having to purchase new technology,”he explained. “Often the credit unions can utilize existingtechnology in a more efficient, effective way.”

When deciding whether to outsource IT or migrate to the cloud,Holt suggests that credit unions ponder thesequestions:

• Is it a trusted vendor with knowledge of the credit unionindustry and thecompliance?
• Does the vendor's culture align with yours? Is it innovative?Are they focused on your success?
• Do the features and functions mesh with your business and ITstrategy?
• Do the benefits outweigh the cost?
• Are you going to get proper support from application provider?(Some application vendors will only support a product that isimplemented in-house or with acertain configuration, he said)
• For cloud solutions: Who owns the data, where is it located,who can access it and what are your legal rights if there is a databreach? (Some data is stored outside the U.S. and might not besubject to the same security regulations and legalprotection.)

By following CSI's advice, Red Rock has resolved many ITheadaches, Trostel said.

Next Page: Challenge Resolved

“One challenge we have resolved over the past few years isidentifying what tech we absolutely not want to work with that doesnot fit our model,” she explained. “If you can't virtualize it, wedon't want it.”

For credit unions suffering IT budget headaches, Trostel offersthis advice: “If you don't have internal expertise, seekit out. Credit unions can't think of themselves as a lone wolf–seek out advice, whether that's through a trusted vendor, CUSO orother CUs.”

South Western Federal Credit Union in La Habra, Calif., alsorealized it needed expert assistance to strengthen ITinfrastructure and security.

“We wanted to make sure we were secure from the outside, and wedidn't—and still don't—have the expertise to pull that off,” saidMiriam Neal, vice president of information systems at the $138million institution.

By partnering with CSI, the credit union has improved the ITplanning process, stream-lined operations and alleviated regulatorypressures, Neal said.

Now, during IT budget planning and examination time, stresslevels are much lower, Neal said.

“I just show examiners my report or get on the line with CSI ifthey have questions,” Neal said. “I love the monthly reports that Iget from CSI, and I've been told by other financial institutionsthat they don't get the same thing from their providers. And it'sdone in a way that my board can read and easily understand.”

While performing the due diligence required to outsource ITservices, credit unions often encounter unexpected challenges. Forexample, the Partnership Credit Union in Arlington, Va., found thatmany IT vendors were not willing to commit to strong Service LevelAgreements (SLA's), the credit union said in a recent case study byHorsetail Technologies, which recently became a silver benefactor of Filene Research Institute in Madison,Wis.

The Partnership FCU selected Baltimore-based Horsetail as theirnew IT partner based on their commitment to service, secureenvironment and strong SLAs, said Bonnie Ortiz, chief operatingofficer for the $137 million credit union.

Horsetail's managed service program allows the 14,000-membercredit union to easily adjust for their current and future IT needswithout impacting in-house staff, Ortiz said.

“With Horsetail, we get the talent we need across the board –whether it is a communications expert to make sure bandwidth iscorrect one day or a firewall expert to strengthen our securityposture the next – we always have the right mix of IT support,” shesaid. “If a credit union our size tried to hire all the talent theyneeded for all of those disciplines, they'd run themselves out ofbusiness and still might not get everything they need.”