If you were leading an important work meeting with lunch and a detailed presentation, you wouldn’t spend days preparing gourmet meals. Instead, you’d focus on your presentation and hire a catering service to take care of lunch.
So why wouldn't you hire out your tech support so you could focus on the core purpose of your organization? Today, we're taking a deep dive into outsourced IT so you can decide if it's right for your business: what it is, why it works, and how it will affect your costs.
What Is Outsourced IT?
Outsourcing your IT involves hiring a third-party provider to manage all of your technology instead of using an in-house team. These providers, often called managed service providers (MSPs), offer customizable services such as cybersecurity, cloud computing, and help desk support to match your specific requirements.
Outsourced IT vs. Co-Managed IT: What's the Difference?
Fully outsourced IT means that all of your technology is handled by a third-party provider.Â
Meanwhile, in co-managed IT, your provider works with an in-house team to handle different aspects of your systems. This partnership can be ideal for businesses that need the expertise and perspective of an external team but the more detailed knowledge of their infrastructure from an in-house team.
Why Outsource My IT?
When you outsource your IT to a professional provider, you free up time and resources to tackle your business’s priorities. You also enjoy benefits that you might miss out on otherwise:
- Predictable, controlled IT costs
- Access to expert insights and resources
- Solutions tailored to your systems and operations
- Improved cybersecurity and compliance
- Enhanced efficiency and productivity with smoother systems
- Reduced downtime with disaster recovery and business continuity planning
- Scalability and flexibility to support business growth and changes
- Proactive maintenance
What Are My Options? Cost Breakdown
Let's take a closer look at different technology management arrangements and what each one means for your IT costs.
In-House IT
Pros: Quick support and communication; deeper knowledge of systems; stronger dedication to business; complete control over IT operations.
Cons: Higher and more variable costs; lack of support during PTO; limited expertise; access to fewer resources compared to external providers.
Costs: Includes hiring expenses, salaries, benefits, PTO, ongoing training, software and hardware expenses, and overhead costs.
Best For: Larger organizations with the budget and need for dedicated, immediate support and full control over their IT infrastructure.
Co-Managed IT
Pros: More hands-on control and collaboration between your internal team, who knows your business, and external pros, who know IT.
Cons: Potential gaps or inconsistencies between internal and external team structures; less efficient processes due to back-and-forth communication; increased time and money dedicated to projects to align teams.
Costs: Includes a smaller monthly fee for outsourced services, plus hiring expenses, salaries, benefits, ongoing training for the internal team, and software and hardware costs.
Best For: Businesses with pre-existing, well-established, and well-functioning IT teams that are looking to expand or upgrade their technology.
Outsourced IT
Pros: Comprehensive and cohesive services; predictable and consolidated costs; hands-off management that allows more focus on core operations; easily scalable and flexible to meet business needs.
Cons: Less direct communication; security risks of giving third-party access to systems; less direct control over IT infrastructure.
Costs: Typically includes a monthly or annual fee (often based on the number of devices or users), and setup and integration fees.
Best For: Businesses without access to in-house IT expertise and resources; new and small businesses that can't afford to hire and train an in-house team; businesses experiencing severe downtime, security risks, or other technology issues.
How Do I Budget for Outsourced IT?
One of the most stressful parts of managing your technology is managing the associated finances. Here are our top tips to simplify the budgeting process for outsourcing IT:
Monitor and Evaluate Usage
When choosing the right IT structure, start by evaluating your current technology usage and identifying the services you truly need. Professional IT companies can help you with this step by running assessments to determine your system's needs. Once your services are in place, regularly track their usage to ensure your technology solutions remain efficient and cost-effective.
Conduct Cost-Benefit Analyses
Before outsourcing your IT, run a cost-benefit analysis to weigh the potential expenses against the advantages. Revisit this analysis periodically to confirm that outsourcing continues to align with your organization's goals and financial situation.
Be Prepared to Adjust
Your business is going to grow and change, as will your technology needs and budget abilities. Stay flexible and prepared to adjust your services or rework your budget if costs become overwhelming or if your needs change. Proactive adjustments can help you maintain efficiency without compromising your bottom line.
Velocity IT: High Value for Your Investment
At Velocity IT, we believe that technology can be your biggest asset. And we believe we can help you make that happen.
We're dedicated to working seamlessly with your team, focusing on your success through clear and consistent communication, robust security to safeguard your resources, and a deep understanding of your business—just like an in-house team. Fill out our form to get started.
