From valet parking to DoorDash, it seems like we’re constantly making choices between doing things ourselves and paying a service to do it for us. And that’s just in our personal lives. When it comes to business, managed IT services are one of those areas where we must weigh the pros and cons of whether to do something yourself or outsource it to a third-party provider.
There are definitely benefits to an in-house IT approach. Specifically, it gives you more control over your IT capabilities, and it can be the less expensive option. However, there are many benefits to using managed IT services that justify the cost, including higher productivity and access to a broader range of expertise. There isn’t one right answer, and it can be difficult to determine which approach is better.
Deciding Between In-House and Managed IT
Before we get into the whole issue of managed IT services vs. in-house IT, it’s a good idea to define each term.
- In-house IT. With this approach, technology services and functions are provided by a dedicated individual or team or employees. This approach offers complete control over all things IT.
- Managed IT Services. This involves an organization contracting out a large section or all of its IT functions. This is a more convenient approach, but it does not offer as much control as keeping everything in-house.
It’s also possible to take the route of co-managed IT (or augmented) IT services. This involves a combination of in-house and managed services. It is best suited for mid-size companies that want to keep some control over their IT functions but aren’t large enough to hire an entire IT team that is capable of handling all technical functions and issues.
Setting up the issue of managed IT services versus in-house IT often comes down to your business needs and the size of your organization. Either approach could be a good fit. If you are a sizable company and want a hands-on approach, you may want to stick with your in-house team. If you’re a smaller company and don’t need to control every detail, managed IT services are probably the better way to go.
With this in mind, let’s take a closer look at the pros and cons of managed IT services vs. in-house IT.
Managed IT Pros
There are many benefits to using managed IT services. Consider the following ways an IT service provider can benefit your organization.
It’s Cheaper
Although using managed IT might seem like the more costly route, it can turn out to be more cost-effective than relying on an in-house team. Let’s not forget that an in-house team must be hired and properly compensated. In addition to paying for salaries and benefits, there’s also the associated overhead. In some situations, the remuneration and overhead associated with one full-time IT employee equal the total fees for a managed IT service package, which includes access to an entire team of technicians.
It’s Easier
Developing an in-house IT department requires a lot of time and investment. After allocating space for the department or establishing remote work infrastructure, you have to hire the right men and women. Then, you need to determine what equipment your team needs, make the necessary purchases, and set up your IT infrastructure. This entire process can take months, and it’s ongoing. If you go with managed IT services, you just sign a contract with a provider and let them handle all of the behind-the-scenes details. If you need new hardware and software, a provider will do it for you.
Current Employees Can Be More Productive
In-house IT employees can easily get slowed down by low-level tasks and support tickets from other departments, which distracts from essential revenue-generating activities and cybersecurity tasks.
Managed IT services can help to keep your IT department from getting overloaded with basic tasks. A provider also means more robust IT support. In-house staff members take sick days, go on vacation, and have personal issues they need to tend to. If you’re only depending on a single or handful of in-house IT staffers, your support ticket may have to wait until absent employees come back to work. With managed IT services, a provider is responsible for covering absences in a way that prevents disruptions.
Providers also typically offer around-the-clock services, so technicians are there if you need to resolve something outside normal business hours.
Better Security
With respect to cybersecurity, it’s almost impossible to avoid using a third-party service. It’s tempting to think in-house IT staff can handle everything, but even at the largest companies, in-house teams typically use third-party platforms to handle network security.
Using a service provider for cybersecurity is particularly beneficial for smaller and mid-size companies. Although these companies might bristle at the idea of allowing a third-party organization to deal with their network and sensitive information, a service provider has many more measures and strategies to keep a network and data safe from hackers compared to smaller and mid-size companies. For example, providers offer a comprehensive disaster recovery plan that minimizes losses and downtime in the event of a serious cyberattack or outage. A provider never has the luxury of getting lazy with cybersecurity. They are in the business of staying current with evolving trends so they can update security accordingly, keeping the latest cyber threats at bay.
More Skills and Knowledge
When your company partners with a managed IT services provider, your organization instantly gains access to a broad range of skill sets and experience.
While many IT functions in a business can be handled by entry-level personnel, complicated operations like network security and routing protocols require a more experienced engineer. Although complicated tasks don’t make up the majority of IT tasks, they are essential to maintaining operations in many companies. If your company has partnered with the service provider, there’s no need to worry if a task is too complicated. Providers employ engineers with all different kinds of experience and skill sets so they can properly provide service to their clients.
This can also help augment your in-house team. If your staff comes across a technical problem that your in-house employees cannot handle, you can easily pass that problem along to your service provider. The provider can then escalate the issue to the appropriate engineer or technician that they have on staff.
Because the IT professionals working at a typical service provider serve a wide range of industries, these professionals bring a wealth of diverse experience. In fact, service provider professionals could recommend outside-the-box solutions for your industry that are standard in a different industry.
Your in-house staff members could then acquire this knowledge. Considering that your in-house staff members are only focused on your specific industry, this transfer of knowledge means even more return on your investment in a managed IT services provider. The IT personnel at a provider may also have hard-to-find skills that would be difficult or expensive to acquire for your in-house team.
Managed IT Cons
Obviously, working with a managed IT service provider isn’t like waving a magic wand that makes all of your IT problems go away. If it was, we wouldn’t be having a “managed IT services vs. in-house IT” debate. There are drawbacks to this approach that could make it a poor fit in some situations.
With this in mind, let’s take a look at the few drawbacks of using managed IT services.
Less Control
If the nature of your business requires a lot of control over technology functions, then you may want more of an in-house approach. A service provider will try to offer as much transparency and customization as possible. However, in-house IT staff members directly report to your company management. Even if they are remote workers, you can have more visibility into and control over how they do their jobs.
Also, when you have less control over your operations, it means having to trust people outside your company. This can be an issue when it comes to cybersecurity. A service provider and its employees are highly motivated to provide strong security. They will keep you abreast of emerging threats and consult with you about necessary updates. However, at the end of the day, you must still trust people outside your company with its security. Companies concerned about security may want to keep those functions in-house, but maintaining robust cybersecurity can easily overwhelm a smaller IT staff.
Fixed Cost
When you sign a contract with a managed services provider, your company takes on a fixed cost that is outlined by the terms of the contract. That cost typically depends on your IT needs and the size of your company. For a smaller company, the fixed cost associated with using a managed IT service provider is a few thousand dollars per month. For larger companies, that cost can reach tens of thousands of dollars or more per month.
That cost does come with peace of mind. Partnering with a service provider means your company is fully covered when it comes to IT services, has access to 24/7 support, and has access to a broad range of expertise.
In-House IT Pros
Just as there are drawbacks to using managed IT services, there are benefits to going with an in-house approach. Consider the following benefits of relying on your own employees for all of your IT needs.
Total Control
When you build your own IT department and directly oversee it, you can customize your IT capabilities based on your ongoing needs. If your company is growing or if you are expanding operations, you can hire employees with the skills and experience that you need. As new employees gain experience with your company, they gain a deeper knowledge of your organization and how it functions.
Service providers offer all kinds of capabilities, but you may not need everything that a provider has to offer. Keeping everything in-house also means only investing in the hardware and software that’s necessary for your IT needs.
Total Oversight
Relying mostly on in-house IT staffers also means having complete oversight. Whether your IT employees are located in your offices or working remotely, you can directly observe what they’re doing and ask questions as they work. This invaluable level of oversight and access is hard to achieve when working with a service provider.
With that being said, it often isn’t necessary to have total oversight of your IT operations. Normal, everyday IT tasks can be easily handled without oversight from management. Significant oversight is usually only necessary when a unique problem pops up and it requires a bit of decision-making.
In-House IT Cons
As we have stated already, there are some drawbacks when it comes to using a completely in-house approach. Because of this, there is a thriving market for managed IT services. Therefore, let’s dive into the drawbacks of only using in-house employees in a bit more detail.
It’s Usually More Expensive
We often associate doing things ourselves with being the cheaper option. However, relying on an in-house team for all of your IT capabilities is often the more expensive way to go, especially in companies that require significant IT capabilities.
When you use an entirely in-house approach, you must build your IT department from the ground up. This means hiring the right employees and paying their salaries and benefits. With many IT positions commanding six-figure salaries, the labor costs of an in-house staff can add up quickly. Add in costs related to recruitment, onboarding, regular training, and turnover, and you start to see just how expensive it is to have an in-house IT team. If you need someone with a specialized IT skill set, the costs of employing that person are much more than employing a standard technician.
Keeping everything in-house also means making major investments in hardware and software. Workstations, laptops, servers, and other IT hardware all come with big price tags. On top of that, licensing fees for software can add up quickly. Skimp on these costs, and you might find your turnover increasing as your IT staff grows weary of using sub-par technology.
Lack of Flexibility
Although having an in-house team handle all of your IT needs means a significant amount of labor customization is possible, keeping everything in-house also has its limitations. When your IT employees are out sick or on vacation, it can impact your capabilities, depending on the size of your department.
Even when they are in the (virtual) office, your IT employees can easily become bogged down by basic support issues. The accessibility of an in-house team is a double-edged sword. It means you have face-to-face tech support when you need it, but it also means your other employees are more likely to come to them with minor issues. If your IT department gets bogged down by these minor problems, they are less able to adjust and adapt to anything that pops up. In-house employees working a normal daytime shift are also less able to respond to issues outside of normal business hours.
By comparison, managed IT services have more flexibility and availability. You don’t have to worry about an employee going on vacation or a problem taking place outside of normal business hours.
Co-Managed Services Offer a Third Option
If you want the control and oversight that comes with an in-house approach but also want the flexibility that comes with an outsourced approach, co-managed services offer a little bit of both approaches. Normally used by larger companies, co-managed services typically involve a provider supplying on-site technicians that your company can use for both day-to-day issues and rapid responses to critical situations.
The Pros of Co-Managed Services
Because they work alongside your in-house staff members, the technicians from a service provider can easily step in when one of your employees is sick or out on vacation. You can also arrange your Co-managed services to cover during off hours. This ensures that your IT needs are always covered.
Co-managed services also provide your company with a greater base of knowledge and experience. Bringing technicians in from a provider also creates opportunities for knowledge transfer that can make your in-house employees more knowledgeable. Your in-house team should find this experience more rewarding as they get to grow their skill set and make professional connections with people in their industry.
While there is a cost associated with using co-managed services, the investment is comparable to paying the salary of an executive IT director. But rather than paying for the skills and experience of one person, your company gains access to both more knowledge and greater coverage for your IT needs. The bottom line is that co-managed services are a great investment for mature companies.
The Cons of Co-Managed Services
The biggest drawback of using co-managed services is the cost. If you’re in a smaller company with modest IT needs, it might be hard to justify the investment in co-managed services. This hybrid approach offers great peace of mind for companies that need it, but smaller companies might find that they don’t have enough need for tech support or IT capabilities. This is because co-managed services can be more expensive than in-house or outsourced capabilities, depending on the situation. That being said, the amount of oversight and added expertise can make co-managed services an amazing investment.
Need Help Making the Choice? We Can Help
As you can see, there are many benefits and disadvantages of using each approach, whether it’s in-house, managed IT services, or co-managed services. Determining which one is best for your company can be a challenge.
If your company needs IT to support every day, but your company doesn’t need strict oversight, then you may want to go with a managed services provider. If your company needs constant support and strict oversight, you might want to go with a co-managed approach. But ultimately, you may want to keep everything in-house.
At Taylored Systems, we help Indiana companies figure out what the best choice is for their organization. We have also been providing managed IT services for more than three decades.
Our properly designed, managed, and maintained service solution can keep your employees happy and productive. We pride ourselves on building strong relationships with our clients, and all of our services are backed by superior customer service. We provide managed IT services with predictable and consistent costs to keep things simple for your organization.
If your company is considering more of an in-house approach, our IT consulting services can help you establish a strong foundation that you can manage and customize moving forward. Using their broad base of knowledge and many years of experience, our consultants become experts in your organization and its IT needs.
Our experts then work with your company to develop an effective strategy that meets your business objectives. We can also offer suggestions on targeted IT solutions that meet your specific needs. Our experts can guide your team through planning and budgeting to make sure it is set up for today and tomorrow.
In addition to offering comprehensive IT solutions, we also offer robust cybersecurity services. We specialize in offering cybersecurity solutions for small businesses because we know that security is critical to organizations of any size. If you are in a small business, we can help your company address everything from raising awareness around cyber security issues to closing security loopholes on mobile devices.
Because today’s companies do so much business in the cloud, we also offer cybersecurity for cloud computing. We help manage the risks associated with cloud computing to ensure that our clients’ sensitive data remains protected. Using encryption, authentication, activity monitoring, and planning, our experts can ensure that your cloud computing operations are protected from sinister actors.
If you would like to learn more about what we offer at Taylored Systems or you need help addressing the question of “managed IT services vs. in-house IT,” contact us today to set up a consultation and discuss the needs of your organization.