When it comes to running a small business, there are a million things to manage. What do you keep in-house? What can be outsourced? Do you even want to outsource, or should you just hire? Internal employees have a stronger connection to the company but they cost more in insurance, benefits, and overhead. Payroll is the largest expense in a business, so you have to make sure you get your money’s worth. Which brings us to the in-house versus outsourced IT debate.
In-house employees only have so much information. To glean the amount of information you get from a specialized team, you’ll likely have to hire a few people, which boosts payroll expenses. You’ll need a few people to spread the workload so that someone can fix issues and maintain your systems, while another can plan for the future and strategize how technology will move the business forward. If your industry is tech-heavy, this may require more than 2 people.
An outsourced team is full of specialists, each with unique perspectives, skills, and levels of experience. When you combine them all together, you get one super-powered department of IT knowledge. From help desk geniuses to high-level tech engineers, the problems your company faces are now the responsibility of your outsourced IT team. Proactive monitoring often means problems are resolved before you even knew there was one. But you have to be able to trust the provider you choose.
When it comes to outsourcing, businesses are at a crossroads: some of the industry is more comfortable with outsourcing to experts and some feel wary at the thought of relinquishing control over any part of their business. And then there’s a third group that isn’t really sure how to feel because they aren’t sure where the cost-benefit falls. This feast of choice often leads to feeling overwhelmed, or what we like to call the 5 Stages of Small Business IT Grief.
1. Denial: We use the cloud. We don’t need IT support.
Wrong. The cloud is a storage tool. If your systems get a virus and don’t perform, it doesn’t matter where you have your items stored. If your systems get hacked and you use the same passwords, it’s entirely possible your cloud storage will be accessible, too. The cloud isn’t a magic substitute for an IT team. You need someone monitoring your network, keeping a watchful eye on security, and making recommendations, so your business can focus on functioning optimally.
2. Anger: It’s going to cost HOW much?!
In Eastern Iowa, an IT hire will cost you approximately $45-60k per year… for one IT System Admin. An analyst is roughly $67k, and someone with the expertise to rival an entire department will be near 6 digits.
That’s before including the cost of benefits and overhead. On average, a business spends the following per salary:
- 15% for Social Security, FICA, and Medicare
- 10% for PTO, holidays, sick days, and jury duty
- 10% for healthcare
- 3-6% for retirement funds
- 5% for miscellaneous perks
For overhead expenses, you’ll need to account for:
- Payroll processing
- Administrative time
- Interviewing and hiring
And then there’s the possibility of turn-over. Investing time and resources in an individual who may decide your small business can’t offer the experience or challenges they need is a small business nightmare. After all of that, outsourcing may seem like a good alternative to payroll strain.
3. Bargaining: Why would I pay extra for monitoring and support services?
Proactive services greatly benefit your business. How? Imagine you come into work. Your technology isn’t functioning properly. Now you have to spend time waiting for your IT person to assess, diagnose, and resolve the issue. If you’re lucky, it’s a minor issue that’s localized. If you’re not, it could be a problem that affects your entire department. All of that downtime cuts productivity and may interfere with business functions, all that could be avoided easily with an outsourced, proactively watched and managed IT department.
4. Depression: I can’t afford to lease.
You’ve heard it said a million times over: leasing is more expensive than an outright purchase. And it can be. Computers should be upgraded every 2-4 years to maintain security and efficiency. If your business can afford to purchase new hardware outright in that time frame, then it may make more sense to do it that way. Leasing prevents budgetary strain by spreading the cost out over a period of time, so it boils down to whether you need to keep cash flow in-house or have money to spend.
Okay. I need help. And maybe that means outsourcing. The good news? Outsourcing comes with a lot of perks.
With outsourcing, you don’t get just one individual. You get:
- A dozen people working for your business
- Vast knowledge pool, from help desk to tech engineers
- Decades of combined experience
- Industry-wide knowledge of trending threats
- Proactive monitoring 24/7/365
- Guaranteed Service Level Agreements
- Patch updates
Outsourcing to a Managed Services Provider (MSP) obviously comes at a monthly cost. This number generally runs in the $150-$200 per business user/workstation per month range.
Obviously, there’s a lot to consider when deciding whether to hire internally or look outward for help. Whether you’re experiencing grief over IT or you feel confident about it, it’s important to consider what will help your business achieve its goals for 2019 in the most efficient way. Know your needs, know your priorities, and if outsourcing seems possible, give us a call. We’d love to help.
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