IT Outsourcing Benefits: Why Do Small Businesses Use Outsourced IT Services?

With the increasing complexity of IT and the rise in cyber threats, more businesses are choosing to outsource some or all of their business’s IT function.

You might be wondering if IT outsourcing is right for you too.

We’ve found that when businesses start exploring the idea of outsourced IT services, they generally want to know 3 things: what made other businesses decide to outsource IT, what kinds of IT services can be outsourced, and the benefits that IT outsourcing might bring to their company.

That’s exactly what this article covers.

Let’s dive into three topics that will help you learn more about outsourced IT services and what they can do for your business:

• Why Do Businesses Outsource IT?
• Top 5 Benefits of IT Outsourcing
• What Business IT Services Can Be Outsourced?

Why Do Businesses Outsource IT?

Sometimes it’s hard to know when the time is right to outsource some or all of your business’s IT. Here are four reasons why other businesses seek help from an outsourced IT services provider:

1. The IT department needs help

When businesses experience slow support response times, security issues, and unremedied problems, it usually means there’s a problem in the IT department. These aren’t necessarily signs that the IT staff isn’t doing their job, but it could indicate that the department is improperly staffed.

If you’ve found yourself thinking that things never seem to get done, it could be because your IT team is spread too thin, they may not have the tools to get the tasks done effectively, or they may not have expertise in the areas that your business requires.

Bringing in an outsourced IT services provider to work alongside your internal team can help bridge the skills gap, bringing more hands and differing expertise to get things done faster and more effectively. This helps improve productivity, eases employee frustrations, and positions you to scale without technology getting in the way.

2. IT investments deliver disappointing results

It’s always a bummer when things don’t turn out how you’d hoped – especially when you’ve spent a lot of money on it. A feeling of “I keep spending more money but it’s not getting better” or failed projects could indicate that investments aren’t being made in the right places.

An experienced outsourced IT provider can work with you to develop and implement a technology plan that aligns with your business plan, giving you confidence that you’re investing exactly where it’s needed.

3. The IT department is too much to manage

The IT function in many small and middle-market businesses typically falls under the COO, CFO, or another business leader with an already full plate. IT is also an entirely different discipline than most executives are trained in, which can create a communication gap.

As a result, it can be challenging for the executive to effectively manage the day-to-day tasks of the IT department, or to know what to expect from their IT team.

When businesses partner with a managed IT services provider for some or all of their IT needs, it takes much of the burden off of the managing executive. You get guidance from IT consultants and support from a larger team of IT professionals, freeing you up to focus on your core competencies.

4. You want to lower technology support costs and get better results

Hiring in-house IT personnel can come with a hefty price tag. For example, the yearly salary for an IT manager in Los Angeles as of February 2022 ranges from $65,000 to $164,000. Add in benefits, unemployment insurance, taxes, etc. and that number only goes up. That’s not to say that in-house IT staff might not be worth it, but due to the complexity and deep specialization of IT these days, most businesses need more than one IT person to effectively manage, maintain, support, and secure a business network.

Managed IT services providers have a deep bench of talent with many IT professionals who specialize in different areas, so all areas of IT management will be covered. This gets businesses better results at a lower cost than staffing it all internally.

Companies that have internal IT staff typically outsource the routine or commodity IT tasks, as well as the highly specialized tasks. This allows internal IT staff to work effectively, focus on what they’re best at, and get the support they need from other IT professionals.

Companies that choose not to have IT staff in-house can also have all of their IT bases covered by a managed IT services provider.

Another cost-saving benefit that you’ll find when partnering with a reputable IT company is that tools like endpoint detection and response (EDR) and multi-factor authentication (MFA) are included in the monthly service cost. These companies are usually able to get them at a lower rate due to economies of scale, meaning lower costs for you and you don’t need to purchase them separately.

Top 5 Benefits of IT Outsourcing

There are many benefits and advantages to outsourcing your IT department to a managed IT services provider.

1. A financial incentive for consistent results

IT providers work on a contract basis, which means they are financially motivated to keep you satisfied. They cannot get complacent. Vendors are typically watched more closely than those of an in-house team, so the outsourcer needs to consistently provide excellent service and results.

Also, fixed-fee arrangements only work out for both parties when things are maintained properly, and unforeseen problems don’t happen. This means your employees will stay happy and productive because the IT provider is working diligently in the background keeping things in tip-top shape.

2. IT is their core competency

It’s the job of IT professionals to take care of day-to-day tasks, such as installing hardware and software, administering backups, security tasks, network administration, maintenance, upgrades, and technology management. They’ve spent millions of dollars and countless hours developing best practices and customizing management software tools so you don’t have to.

3. Resources are rapidly scalable

Sometimes a problem happens that impacts several people all at once. Or sometimes multiple different problems happen all at the same time.

When this happens, an IT provider will be able to quickly allocate as many resources as necessary to solve the problems simultaneously. This means multiple employees can get help from different IT technicians simultaneously instead of waiting for an available tech, which reduces downtime and improves employee productivity.

This is also helpful if you find yourself in a rapid growth situation. You won’t have to worry about staffing up your IT team to meet the growth needs – the IT provider will do that if they don’t already have resources. The same is true for downsizing.

4. They have the right, trained experts for the job

IT as a category contains many different disciplines – security, cloud, networking, storage, communications, end-user support, and high-level strategy, to name a few. Each requires a different aptitude and training. For example, hiring a Help Desk specialist and expecting them to manage your network is like hiring a machinist and expecting them to also handle accounting.

Most small to mid-sized businesses can’t afford to employ experts in each of these areas. When you work with a managed IT services provider, you have access to a whole team of experts that are easily accessible because the cost of employing each of them is distributed amongst each of their clients.

5. Thorough network documentation

With outsourced IT services, you’re typically assigned a team of IT professionals who will work with your company regularly. Other resources might also be needed for special projects, complex issues, or if changes to the team are made. This means the network documentation must be accurate at all times for the engineers to reference.

The result is that the intricacies of your network are documented instead of stored in one person’s brain.

Also, the work the IT provider does for your company needs to be tracked and accounted for, whether it’s a fixed-fee agreement or not. This gives you visibility into what’s being done on your network and the status of that work.

What Business IT Services Can Be Outsourced?

Almost any task that an internal IT department does can be outsourced. That’s not to say that every task should be outsourced or that there isn’t value in an internal IT department, but the IT needs of today’s businesses have changed, making outsourcing some or all IT tasks a desirable option.

You can outsource all kinds of IT services, including, but not limited to:

• IT Strategy, Budgeting, and Technology Planning
• Onsite and Remote End-User Support
• Network Management & Administration
• Network Operations Center (NOC)
• Patch Management
• Web Filtering
• IT Security Threat Prevention and Remediation
• Spam Filtering
• IT Project Management
• Infrastructure Upgrades & Technology Rollouts
• Backup Management & Administration
• New User Setup & Training
• Secure Employee Termination
• Lifecycle and Hardware Inventory Management
• Best Practice Implementation
• Cloud Management & Administration
• Cyber Security Services
• Regulatory Compliance Services (CMMC, NIST, ITAR, PCI-HSS, HIPPA, etc.)

Managed IT services agreements come in a variety of arrangements, so it’s essential to weigh the options and choose the one that is best for your business.

The type of IT department outsourcing that produces the best results for Southern California small and mid-sized businesses is a fixed-fee managed IT services agreement. A fixed-fee agreement benefits you and the outsourced services provider when you don’t have issues. This agreement type eliminates unexpected expenses while providing a proactive approach to your IT management.

The right outsourced managed IT services arrangement will give your business the best possible IT results at the right investment.

Ready to Experience the Benefits of IT Outsourcing Firsthand in Your California Business?

If you’re ready to explore IT outsourcing for your small business, reach out to us any time. You’ll chat with one of our Technology Consultants and they’ll help guide you to the best IT management option for your business.

Editor's Note: This article was originally published in January 2018. It has been revamped and updated with the latest information.