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How Much Does Outsourcing IT Cost?

There isn’t any question that businesses operate to make profits, and to save money. For many, outsourced IT is a solution that improves the bottom line dramatically. For others, digital leadership can make a significant impact. And other times, the internal IT staff is overworked and does not have time for strategic initiatives. However, some believe that outsourced IT pricing will not fit the budget. Surprisingly, many outsourced IT pricing plans are designed to be cost-effective and add measurable business value.

What is outsourced IT?

Outsourcing some or all of your organizational technology needs to a managed services provider (MSP) is engaging in the practice of outsourced IT. The types of services you receive depends on the vendor. It’s also crucial to work with a provider who is a true IT partner.

Fully outsourced IT is an option when you have no on-site IT team. The MSP provides all technology-related services from cyber security to network monitoring to backup and recovery to hosting to updates and more.

Co-managed IT is another option if your company does have an in-house team, but they are overwhelmed and need help. Some services might include updates, backups, cyber security, employee training, and VoIP implementation and management. On the other end of the spectrum, you might have an in-house IT team but choose to partner with an MSP when you require certified and specialized talent.

Invariably, outsourced IT makes a massive impact on lowering technology, labor, and storage costs while increasing efficiency. You also get on-demand access to a team of experts in their field who provide the latest tools and technologies to facilitate your digital transformation. Further, an MSP can provide the digital leadership your company needs to ensure an optimized IT infrastructure that is secure and works as intended.

Let’s look at the options more in-depth…

Should you keep an in-house IT team?

Internal IT departments may seem like the best option to keep your business running, with someone always available in the office to keep everyone’s printers running and passwords up to date.

But, this method often comes at a severe cost, depending on where your business is located.

The average desktop technician generally commands an average salary of around $50,000 per year. This entry-level IT employee’s primary role is to update and maintain hardware and software while handling minor troubleshooting issues.

For some businesses, retaining an in-house IT department may seem like the right choice because you can always have a team member to resolve issues quickly and enable business continuity. But, an entry-level IT employee can command a starting salary of $50,000 per year. An IT Director is paid between $80-$130,000 annually to focus on your core business IT systems.

IT Directors have the experience to manage high-level tasks, but are often consumed with putting out fires. So then, you’re paying a team member six figures to manage the low-level tasks because you may have a small IT team. Moreover, if you task your entry-level IT employee with more than they can handle, there is no telling how long they will stick around.

Additionally, you can’t expect your in-house team to work 24/7. They have to rest, they have paid time off, they have vacation days, they get sick, and more. You may also have to pay for benefits, ongoing training, and other human resources costs.

In contrast, when you outsource your entire IT department, you will always have 24/7 access to an expert and certified team. Your employees will have access to 24/7 support, as well. Using remote applications, many issues are resolved quickly and without an on-site visit. But, on-site visits are also part of the package and utilized when needed. Pick up the phone, send an email, get on live chat, and you’re connected to your MSP at any time, and for any reason.

Advancements in technology are occurring at a pace unparalleled in any other time in history. There aren’t enough hours in the day to keep up. However, MSPs have a business model that requires their team members to get training and certifications on every new technology. In the digital age, you need this breadth of experience and expertise to retain a competitive advantage. For small-to-midsize businesses, the cost savings and value are considerable.

Outsourcing some IT

Perhaps you do want to keep your in-house team for specific initiatives, but they could use some help. You can certainly increase employee engagement when you give them some of their time back to focus on what they do best. Your IT department will be happier to have an extended team who can manage unique tasks and routine maintenance. Your employees will also be more productive as they have a team who ensures all their systems are running and secure. It is the best of both worlds. Is it too expensive?

How much does outsourced IT cost?

At a minimum, your organization of 10+ employees will require one “Tier 1” help desk technician to handle day-to-day troubleshooting and one IT manager to address more significant administrative issues and business processes.

The right MSP will offer a predictable monthly billing plan where you only pay for what you use. As such, it is difficult to pinpoint an exact cost for outsourcing IT. If your company has 10 or more employees, then you will need at least one outsourced technician. By partnering with an MSP, you aren’t going to pay the same $50,000 annual salary and benefits as you would for an in-house resource. If you have a company with 40 or more employees, you’ll need an IT team. One or two people can’t keep up with an office this size over the long term.

Nonetheless, every business has different needs. Some want a basic package including help desk, remote monitoring, and other fundamental services. On the other hand, some companies need a wider range of specialized services such as managed cyber security, cloud hosting, and virtualization. What’s nice about MSPs is you get to design a package that aligns with your business objectives.

How can you budget for outsourced IT? Well, IT spending comes with fixed and variable costs. Yet, MSPs offer a predictable monthly billing structure where you can add services or increase capacity as needed. Therefore, you don’t have to worry about unpredictable and variable costs. As a result, you have more control over your budget and IT spend. Moreover, the MSP takes on the responsibility of proactive planning and monitoring your network effectively.

It’s always crucial to talk with your MSP and understand if there are additional fees for particular services. Unquestionably, budgeting for IT costs with an expert MSP is not difficult. You will always know what to expect in your monthly bill. This structure is the safest way to avoid surprise fees.

If you’re interested in learning more, stressed about your current team struggling to keep up with your scaling business, or curious to see how you can balance operating costs with future growth, contact us to learn what outsourced IT can do for you!

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