Chances are you’ve already heard about managed service providers and some of the advantages of outsourcing your IT service needs to a third party provider. But, you probably haven’t heard about ALL the IT outsourcing pros and cons that encompass this ever-growing global industry.
In fact, what we’re seeing is that the average budget for outsourced IT services has risen dramatically, to the highest rate in over 10 years.
What that tells us is that there must be some overwhelming positives for businesses to either replace or supplement their in-house team of IT professionals.
Naturally, there must be some cons of outsourcing IT services as well. But we’ll get into all that later on.
For now, we’re going to get you the inside scoop on everything you need to know about IT outsourcing advantages and disadvantages. We’ll explain all the major benefits you can expect to enjoy and why MSPs are able to deliver on said pros.
We’ll also take a look at a few of the biggest drawbacks that can be suffered when companies outsource their IT needs and aren’t prepared for what that means.
What Exactly are IT Outsourcing Services (and Why are More Businesses Choosing Them)
Simply put, IT outsourcing is contracting out the duties of your in-house IT department to a third-party managed service provider (MSP). These services can range from simple remote IT support to full-scale data center management and even software development.
While there are benefits and drawbacks to any business decision, it’s clear that more and more companies are choosing to outsource at least some of their IT needs. In fact, according to recent industry forecasts, we can expect to see even faster adoption rates for this model over the next few years and across all time zones (globally).
5 Possible Disadvantages of IT Outsourcing
Contrary to the 10 benefits of IT outsourcing that will be discussed below, here are 5 of the most frequent cons to IT outsourcing that can crop up, depending on various circumstances.
Before we get into it, it’s worth noting that none of these disadvantages are things that should happen with a competent managed IT services provider. What follows are possible issues that can arise if the MSP you’re working with fails to live up to the service standards that your business deserves.
In fact, if you’re currently experiencing any of the below issues with your current provider, we strongly encourage you to get in touch with us for a free, no-expectations consultation.
We can provide you with the knowledge you’ll need to hopefully remediate these issues with your current provider (or else entertain the idea that Yardstick can perform the managed IT services your current provider is failing to deliver!).
1. Loss of Control Over Your IT Systems
One potential disadvantage of outsourcing is that you may lose some level of control or visibility into how your IT systems are managed – which can be a big concern for businesses that need to maintain strict compliance standards and regulatory guidelines.
2. Increased Costs Due to the Addition of an Intermediary
While it’s true that outsourcing offers benefits like lowered costs for hardware and software maintenance, these benefits can easily be offset by the added cost of paying an intermediary to manage your outsourced IT team.
Higher Complexity when Integrating Multiple Providers and Interfaces
Another downside is that managing multiple service providers requires more administrative work on your end, including dealing with different reporting structures, interfaces, and billing cycles.
4. Slow Response Times and Higher Risk of Outages or Downtimes
If your IT provider is unable to meet the needs of your business, this can lead to lower performance levels, delayed responses to critical issues, and even system outages or downtimes – all of which erode trust in the outsourced model over time.
5. Increased Risk for Non-Compliance with Regulatory Guidelines
Businesses that rely on outsourcing for their IT needs may be more at-risk for non-compliance with regulatory standards due to a lack of control or visibility into how these systems are managed by an external provider. This can have serious consequences for businesses that depend on high levels of security and compliance in order to stay competitive.
While there are many business benefits to IT outsourcing, it is important to be aware of the potential drawbacks and risks associated with this approach.
The 10 Biggest Benefits of IT Outsourcing (and How MSPs Deliver on Them)
Here are the 10 most common benefits of IT outsourcing that many businesses enjoy today:
1. Access to Specialized Skills and Resources
When you choose an MSP, you’re tapping into a team of trained IT professionals with years of experience, deep knowledge in all areas of IT infrastructure, security and support.
You get access to specialists for each area of your business needs, without having to hire them full-time or train existing staff members yourself.
2. Cost Savings for Hiring and Benefits Packages
By outsourcing your IT services, you don’t have to worry about the costs associated with onboarding new hires or paying benefits packages for full-time employees who may not be working 100% of the time anyway.
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The cost reduction is significant – estimates range from 20% to 30% and as much as 59% of all businesses outsource specifically to cut costs. In many cases it also comes with the added benefits of predictable monthly fees, no long-term contracts, and savings on purchasing hardware.
3. Better Use of Your In-House IT Team
When you outsource some or all of your IT needs to a managed service provider, it frees up time for your existing IT staff to focus on higher priority projects that are specific to your business goals, instead of time-consuming IT issues.
This means greater efficiency, heightened competitive advantage and improved employee morale as they don’t have to struggle with mundane day-to-day tasks that can be handled more effectively by someone else.
4. Access to New Technologies and Innovations
A big benefit of IT outsourcing is staying ahead of the curve in an ever-evolving field like technology.
Because MSPs have access to leading-edge technologies and are constantly testing out new innovations, your business benefits from these benefits as well.
5. Scalability and Flexibility to Adapt to Changing Business Needs
When you have an in-house IT team, it can be difficult – and expensive – to scale up or down depending on the demands of your business at any given time.
With outsourcing, this is much easier to manage. If you’re looking for more support during certain times of the year, for example, or if you experience a surge in growth and need additional resources temporarily, it’s easy enough to make changes without having to worry about long hiring processes or retraining staff members who may no longer be under contract.
6. Reduced Risk of Cyber Threats and Security Breaches
With an MSP in place, you get 24/7 monitoring of your IT systems and infrastructure, including a dedicated team of experts to proactively prevent potential security threats.
This means far lower risk than if you were relying on your own internal resources for protection – who may not be able to keep up with the ever-changing landscape of new cyber threats.
7. Greater Focus on Growing Your Business
Outsourcing some or all of your IT needs allows you to focus on core business growth goals and serving your customers better.
This ensures that you are getting maximum value from each investment dollar spent, as opposed to tying up valuable resources on non-core functions like IT. This is an especially relevant benefit of IT outsourcing for small companies who are looking to grow.
8. Increased Time and Cost Savings
From a purely practical standpoint, one of the advantages of outsourcing IT services is that it frees up your existing in-house resources to focus on initiatives that are more important to growing your business.
On top of this, you get tangible benefits like lower costs for hardware and software maintenance, as well as predictable monthly fees that make budgeting much easier. These benefits can save both time and money over the long term.
8. Greater Flexibility with Remote Access & Offsite Data Backups
As technology becomes increasingly mobile, it’s easy to take these benefits for granted.
But having access to remote support 24/7 ensures that issues can be addressed quickly – minimizing downtime and ensuring maximum productivity at all times. With offsite data backups, you also have the peace of mind of knowing that your critical data is safe in case of an emergency or natural disaster.
10. Reduced Risk From Human Error and System Downtime
By partnering with a top-notch managed service provider, you benefit from their expertise and ability to prevent common issues like human error, system downtime, and even power outages.
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This dramatically reduces the risk of major business disruptions and ensures you get maximum value from your IT resources.
With benefits of IT outsourcing like these, it’s no wonder that more businesses are choosing to outsource their IT needs!
Capitalizing on the Benefits of IT Outsourcing Services with Yardstick Technologies
Here at Yardstick Technologies, we’ve streamlined our company and service offerings to ensure that all of our clients receive only the benefits of IT outsourcing and none of the disadvantages.
Yardstick Technologies was founded to help small and medium businesses in Western Canada with their technology needs. Our aim has always been to guarantee that our client’s technology serves them as an advantage and never a challenge.
If you’d like to learn a little more about how we do things and how you can receive the benefits of IT outsourcing listed above, simply schedule a free consultation with us to discuss your requirements and your budgetary preferences. We’re confident that, together, we can help your business succeed.