100% Insourcing is a High-Risk Strategy

There’s a great saying that’s very relevant to the IT industry: ‘You don’t know what you don’t know’. 

The reason I say this is when it comes to an ever-changing and dynamic industry like IT, not knowing what’s available in the marketplace that you can leverage to your advantage is a risky position to hold. Unless you have deep pockets and techs with wide-ranging skill sets who frequently explore and test new technology, you’re falling behind.

The notion that all departments and roles within an SMB have to be in-sourced is continually eroding. When it comes to technology, the fast-changing pace gives more reason to outsource. An IT outage can quickly bring an organisation to its knees, especially when a business has only one IT staff member.

What do you do when your tech is off sick, or on holidays? The business still needs to function. What if a user forgets their password? Quite often in an SMB, the administrator password is shared around to the ‘fallback guy’ so that in the event the IT guy is off, that someone can log into the server and reset the password. But this is the fallback IT guy, right – who obviously isn’t as good as your main IT guy – otherwise, he would be your IT guy, or he’d be working for another organisation as their IT guy.

And this person has the administrator password to the organisation…

I hope this is ringing alarm bells. This opens up a can of worms for what else they could do with this level of access.

This leads me to the biggest question an organisation faces when it comes to having internal IT staff – how many techs do you need? That’s a thorny question – after all, have you ever heard of a tech that isn’t busy? Try trolling the Internet to see if there’s any quantifiable data on this and you’ll probably end up more confused that when you began.

From our experience over the last 15 years, we’ve found that internal IT departments normally have between 30 and 80 devices per technician. When you account for all the peripheral costs associated with internal It staff, like continuous training, IT tools and systems, after-hours call outs and availability, the costs land somewhere between $1,200 and $3,000 per device per year!

Scrutinised this way, it makes a lot of sense to outsource these services to a Technology Solution Partner who can provide the whole gamut of services for less cost and less hassle.

But how does insourcing compare? Local MSP/TSPs typically manage between 100 and 150 devices per technician, while highly structured and process-driven MSP/TSPs push that up to around 200 devices per technician! How can this happen?

In an internal IT department, techs are often driven by what they want to do, or they are busy learning how to fix a new issue at hand. Unfortunately, this doesn’t translate to improvements in the organisation. On the contrary, an MSP/TSP has to drive on two fronts to be successful.

  1. Do as much as possible in as little time
  2. Provide a great experience

On average, we find we need less than 40 minutes per device per month to manage, maintain, support and service that device. Insourced technicians typically need an average of between 2 and 5 hours!

So now that you know the benchmark – what are your techs doing with all their time?


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