Building the Case for Outsourcing IT Support
In a world that’s still coming to grips with the fallout from the pandemic, organizations turn to outsourcing for a straightforward reason – cost savings. That’s true regardless of the outsourced service, but especially true for outsourcing IT support. More on that later.
For example, in a survey conducted by Deloitte, most executives (70%) focused on their bottom line as their primary reason for outsourcing. However, another 40% emphasized greater flexibility to accommodate remote workers and the fast pace of digital transformation.
Cost reductions associated with outsourcing are pretty authentic. For instance, a study of 7,500 public organizations cited a savings of roughly 46 percent of costs using outsourced support versus in-house support. Other studies point to savings in the 20-30 percent range.
Not surprisingly, with results like that possible, outsourcing is expected to increase in the coming years. In great measure, that increase stems from moving to a remote work model that imparts a greater reliance on virtual meetings. But, equally important, companies seek to preserve monies as the economy remains volatile.
What About Outsourcing at Small Businesses?
Concerning small businesses, the primary focus is increased efficiency, followed by greater access to expertise. Overall, the notion is that they can capture extra time and more substantial staff support. Both these outcomes promote greater scalability and improved service offerings. In addition, it allows small businesses, in particular, to remain competitive.
More than one-third of small businesses outsource services. Why? Outsourcing allows smaller organizations to tackle the challenges they face daily, namely:
- Hiring new employees
- Increasing profit
- Employee healthcare
- Growing revenue
- Managing cashflow
For instance, outsourcing impacts profitability, revenue growth, and improved cash flow. By using IT services, your business can reduce its reliance on hiring. In addition, that reduces healthcare expenses. These reductions support revenue growth, increased profits, and improved cash flow.
What Services Are Outsourced the Most?
As you might expect, some industry segments lend themselves to outsourcing better than others. First, there’s accounting. Thirty-seven percent of small businesses farm out their accounting. But right there with accounting is, you guessed it, IT support. The same percentage of small organizations (37%) outsource their IT services.
Security is the chief concern among IT leaders – 83% planned to outsource security to a managed IT service provider in 2021. In addition, 14% of companies report outsourcing more than 50% of their cybersecurity services. Security aside, digital transformation plays a critical role in the move to outsourced IT support as 89% of surveyed industries point to the need to accelerate their digital transformation.
Security aside, cloud services stand to increase substantially. More than 94% of organizations look to cloud computing to improve their operations (Orient).
Not surprisingly, the value of outsourced IT support projects to just under $414 billion by the end of 2021 (Statista). Moreover, that market projects to increase by $98 billion from 2020 until 2024. Technology advancements, cloud migration, and increased mobile usage contribute to that expanding market.
10 Statistics That Present a Case for Outsourcing IT Support
In-house IT services present a significant cost center, especially to smaller organizations. First, they require capital expenditures for equipment and software. Second, they need staff support to manage and maintain that equipment. And let’s be honest – a single-person IT department won’t cut it considering how quickly the landscape changes. So, that means additional expenses for salaries, benefits, overhead, etc.
Equally important, IT support demands 24/7/365 attention. After all, cybercriminals don’t operate on an 8:00 to 5:00 basis. So, again, try getting a single-person staff to meet that level of demand.
Moreover, here are some more compelling statistics pointing to the advantages of outsourcing IT support:
- Nearly one-quarter of small businesses neglect endpoint security.
- 20% of SMBs suffer a failure every five years, leading to critical data loss.
- Even though 43% of cyber-attacks target small businesses, only 14% of SMBs can defend themselves adequately against those attacks. In addition, 28% of data breaches in 2020 involved small businesses.
- Gartner projects cost for IT downtime at $5,600 per minute. That translates to an average of $300,000 per hour, depending on how your business operates.
- Nearly 60% of small business executives indicate issues implementing new technologies.
- 80% of small businesses fail to take advantage of available technology.
- 46% of SMBs with less than 1,000 employees experienced 5-16 hours of breach-related downtime.
- 47% of SMBs report securing data as their most significant challenge.
- 78% of SMBs view security as their top cloud challenge.
- 22% of SMBs moved to remote work without a cybersecurity threat prevention plan.
Outsourcing Improves Your Bottom Line
But here’s the big kicker – small companies that use technology earn two times more revenue per employee. In addition, they experience four times the revenue growth annually. Lastly, they’re three times more likely to create jobs the following year.
The above points to the benefits of outsourcing IT support to a qualified managed IT services company, whether in a fully managed or co-managed solution.
The Benefits of Outsourcing Your IT Support
Let’s start with the obvious. When you use IT support services, you gain real-time support from a group of technicians dedicated to information technology. And that has key advantages:
- 24/7 round-the-clock support so you’ll never lack coverage
- Access to varied expertise like networking, system administration, cybersecurity, cloud computing, and more
- Centralized resource for monitoring, troubleshooting, and management of your IT operations
- Reductions in staffing overhead
- Savings on capital expenditures as costs become operational expenses
- Less server and network downtime
Most importantly, these benefits translate to business value and bona fide cost savings.
First, managed IT services reduce IT costs by up to 45%. In addition, they increase operational efficiency up to 65%, according to Mordor Intelligence.
Second, you’ll reduce maintenance costs substantially. For example, Cisco reports that managed services reduce IT maintenance by 40%.
Third, managed services allow organizations to reprovision IT staff to focus on critical business areas. That yields a 42% increase in the productivity of IT staff (IBM).
Fourth, you can reduce your IT infrastructure costs up to 25% (IBM).
If you don’t believe it, let’s look at a study conducted by IBM relating to the business valuation of managed services. It found managed services deliver quantifiable results for organizations, as you can see below:
Granted, the findings relate to larger organizations. But these benefits translate to SMBs equally.
IT Support Benefits a Large Cross-Section of Your IT Operations
By outsourcing IT support, you can enhance capabilities and efficiencies across broad segments of your IT operation:
- Device and inventory management
- Network management
- Server management
- Cloud management
- Business continuity and disaster recovery
- Cloud storage
- Threat management and intelligence
- Intrusion detection and prevention
- Endpoint detection and response
- Continuous vulnerability scanning
- Security Operations Center
As an SMB, you can’t afford to invest in this list of expansive capabilities. But by working with an IT support company, you can do so at a fraction of the cost. Moreover, you access enterprise-level features that would otherwise be out of reach.
Let’s Build the Case for Outsourcing Your IT Support
Hopefully, you’ve seen how outsourcing IT support benefits small to mid-sized businesses.
As an IT company, we support SMBs throughout Pennsylvania, in particular. Our IT support services let you take advantage of the latest advances in cybersecurity. Plus, you’ll enjoy reductions in overhead while gaining access to IT experts that might otherwise be out of reach.
Let’s talk about how we can deliver the IT services you need to improve your operations and save money. Set up a 13-minute consultation, and we’ll put you on a track that will drive your IT success. Schedule it now.