In-house vs Outsourced IT for businesses

Question

I am at a point in my business where I either need to hire a full time IT person or an outside company to manage my network. How do I evaluate the options?

- Stewart

Answer

This question was answered on September 21, 2007. Much of the information contained herein may have changed since posting.

The complexity of Information Technology (IT) required to run the average business these days can be overwhelming and most companies don’t have a handle of what it really costs to manage what they have.

Unlike typical line item expenses such as rent, utilities, payroll, etc., technology costs are often more difficult to calculate because of the hidden costs in downtime, lost productivity and poor planning

The reality for most companies is that they need a combination of in-house and outsourced resources in order to manage this critical area of the business.

The most common elements that have to be addressed include:

- E-mail Services

- Website development & hosting

- Network Management & Security

- Application support

- Long-term planning

- Disaster planning

The key considerations for the best solution to each include:

- Cost

- Ease of management

- Reduced risk

- Experience level

Companies that can only justify a single person for their in-house IT staff are in a particularly precarious situation The risk level in placing all of the responsibility on one individual is high because if they leave your organization or if their skill set is not properly suited for your present and future needs, your company will suffer.

If you are like most businesses, your technology is the lifeblood of your operation and putting that much control over your future into the hands of a single individual is very risky.

The number of calls we get from a frantic business owner who is locked out of their own network because their IT person left is all too common The cost of having a third-party come into a panic situation where there is little or no documentation is very high in both productivity and money

The amount of money that it would take to hire and retain a relatively competent IT person along with the additional costs in payroll taxes, benefits and other associated expenses will generally be much higher than contracting with an experienced IT service provider.

If you hire a company that has many years of experience and many technicians, you get the benefit from all that experience from the moment you engage with the resource Technicians that work on hundreds of business networks every year can bring those experiences to your business allowing you to make more educated decisions.

You also have a much easier time “firing” the resource and can hold them accountable in ways that you could not with an employee.

It’s just not realistic to expect that a single person can keep up with rapid changes in business technology, so engaging with resources that work with lots of other businesses is truly beneficial, even if you do have an individual that is dedicated to your IT needs.

Having a single individual at your business that is in charge of managing the technology needs makes sense, but having that person in charge of actually doing the work rarely makes sense.

No matter which direction you go, there are a few essential items that you need to make sure you have in your control as the owner of the business.

Simple things like knowing your administrator passwords and having a blueprint of your company’s network can save you lots of time, grief and money when an emergency arises or if your existing resource needs to be replaced

Developing a disaster plan in the event of fire, flood, theft and employee sabotage are also essential parts of a solid IT strategy, but most one-man IT departments can’t seem to find the time to be proactive Don’t put yourself in the position of trying to develop a disaster plan in the middle of a disaster!

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Author

Posted by Ken of Data Doctors on September 21, 2007