Pros and Cons: Managed IT support fees vs the cost of hiring

Pros and Cons: Managed IT support fees vs the cost of hiring

blog-img-managed-it-support-fees-1

Please note: We've updated the salary data in this blog on March 2018. 

Every business knows they need someone to take care of IT. But should you hire someone, or should you outsource it? It really comes down to understanding how IT support fees differ from hiring someone and which produces the best outcomes. Plus you need to be confident that whichever way you go, you’ll get the kind of support your business needs from someone you want to work with.

The Costs of Hiring IT Staff

According to the Robert Half Technology website the salary range (as of March 2018) for a Network Administrator in Chicago is between $90,464 and $152,214. That doesn’t include benefits, training, outside consulting, bonuses, or other employee related expenses. Most organizations factor an additional 30% for those extras, bringing the true cost of a full time Network Administrator into the range of between $117,603 and $197,878. If you take the average within the range, your Network Administrator could expect $157,740 per year or $13,145 per month.

Expect an average cost of $157,740 per year or $13,145 per month for a full time Network Administrator in Chicago. Check out the Robert Half Salary Calculator to find out what the cost is in your city.

The Pros and Cons of Hiring Full Time IT Staff

PROS

  • You have complete control over who does what when the IT support comes from within your staff. You also have someone completely immersed in your corporate culture.
  • Someone is on-site to help during your business hours. This is an advantage if something needs to be physically repaired or if you have people on your team who immediately want someone in their office to resolve their problems.
  • This is the way to go if you aren’t willing to experience any disruptions from transitioning to a managed services provider. While reputable service providers should be able to move you into their model with very little noticeable disruption, this will depend on who you hire and what you bring them in to do.

CONS

  • For some SMBs, the costs for a qualified professional can be prohibitive.
  • It is almost impossible to find a single Network Administrator who is proficient in everything you need for your computer environment. If you do find this person, their salary likely isn’t affordable.
  • You may have to sacrifice one level of expertise for another. If you hire someone with management skills, you’re likely to get less hand-on expertise from them (ie their not likely to crawl under someone’s desk to fix a connectivity issue). On the other hand, if you hire a hands-on person, they are unlikely to contribute at a strategic level to your IT needs.
  • You have to find work-arounds for vacation or after-hours support when your IT staffer isn’t available.
  • The IT industry has high turn-over so you may have to recruit, replace, and train new IT staff frequently.

IT Support Fees – what you can expect to pay

There are two common models for IT support fees: the hourly break-fix model, and the managed IT services model. You can learn more about the differences and the pros and cons of each in our SMB’s Guide to IT Support Services and Fees.

A managed IT services firms will typically quote you a monthly fee. That fee is based on the number of devices you have that require maintenance, back up, and support. In the Chicago land area, that fee is somewhere in the range of $300 to $500 per server, $50 to $150 per desktop and approximately $20 per smartphone or mobile device.

Most IT services companies who offer a break-fix model will contract for between $125 and $225 per hour, often with a two-hour minimum service call. You can often qualify for a 5% - 10% discount if you purchase a block of hours in advance. You can ask them for quotes on individual projects which will vary depending on the scope of work required.

The Pros and Cons of IT Support Outsourcing

PROS

  • Depending on the nature of your contract, the costs can be considerably lower.
  • Many of the software and tool costs for moving to a cloud platform are included in a managed services monthly contract. This itself can be a significant cost savings.
  • Managed services providers have a broad scope of expertise on staff. They can offer expertise for everything from high-level strategic decision making about your IT infrastructure to setting up the network and computers for a new office. Because they work with many other businesses, they will have seen and solved most of the problems you are likely to encounter.
  • Someone is always on top of everything. Patches are done on time, backups aren’t missed or forgotten, security is managed, and everything is tested on an ongoing basis.
  • They stay on top of technology and can often make experienced recommendations about software and applications for your business. Most managed services providers invest time and money in keeping on top of what’s new and what works.
  • You can use your managed services provider to supplement your IT staff. For example, if you have a great hands-on person who does the day-to-day troubleshooting for your staff, you can bring in extra support for security and backup, general maintenance like patch management, or strategic decisions and planning.
  • 24/7 support is offered by most companies so you can get support when you need it.

CONS

  • Unknown costs for “break-fix” model contracts can be a concern. A managed IT contract that includes a fixed monthly fee lets you better plan your IT budget.
  • Managed service providers are not physically located in your office, so if something requires a physical presence to fix, they would have to dispatch someone to your location.
  • Some companies are concerned about the lack of a relationship with their managed services provider or are concerned that they’ll have to work with a new person each time they reach out for support. That isn’t always the case however. Some firms – like ours – assign each company an account manager who is your primary point of contact, and try to build consistency into the technicians who work on your account.
  • Trust can be a concern as you’re giving an outside firm access to your data and networks. This is why it’s important to find a reputable firm who takes a professional approach to managing your account.

If you're interested in learning more about the costs of Managed IT services for your midsized business, get in touch.  Our Free Quote comes with no stings attached.