Chapter 6: IS OUTSOURCING MORE EXPENSIVE THAN MANAGING IT IN-HOUSE?
In most cases, we’ve found that working with an outsourced IT provider is the most cost-effective way to go. It’s important to look at the true cost of keeping IT completely in-house. Many companies allocate their IT costs based on the salary of one employee plus all costs paid to an official vendor for hardware and software. This approach does a good job of catching the big ticket items like servers and new computers. It’s the small expenses that oftentimes go unnoticed, though. These are things like network cables, tape backups, web ordered software updates and random expenses from employees. We’ve found in most cases that a large chunk of IT-related expenses are inaccurately accounted to other departments because the true nature of the expense isn’t understood or well documented.
Then there are indirect expenses like productivity, morale and employee burden rate, which are nearly impossible to track. When an employee’s computer breaks down, they can’t do any work until it is fixed. The longer they wait for the IT department to get back to them, the more it costs your business for that person to sit around waiting for IT support.
Beyond breakdowns, consider what it would be like if every computer in your company ran twice as fast? Employees would spend less time waiting for programs to load, emails to send and files to transfer. Those saved seconds turn into minutes which turn into hours and days of increased productivity.
Then there are the long-term expenses. Many smaller companies don’t have a dedicated IT person on staff. They just have a single employee who is the unofficial “IT captain.” It isn’t their job, but it’s part of what they do. IT support takes away from their core focus. As the IT needs ebb and flow, so does their productivity in their primary role.
Overall, what we’ve found in our years of experience is that outsourcing IT is a less expensive and more strategic choice. Outsourcing IT can add time back into your employees’ days. It can enable your users to be more productive and equip your IT staff to be more efficient. We’ll make sure that all IT-related costs are properly covered and accounted for.