Cost Comparison: Outsourced vs. In-house IT

At some point, every business has to decide which approach to take when it comes to IT – hiring a full time employee or outsourcing to a third party business. Most small to medium sized businesses begin to have difficulty when they opt to have an existing employee handle IT tasks. Aside from the sheer inconvenience of trying to build and run a network while performing other tasks and assignments, that current staffer is likely not up to date on the latest tech and trends. Hiring a new person can help, but a new hire is also a huge expense – you’ll spend money on far more than just an annual salary when you hire a dedicated staffer.

Here are some of the biggest expenses you’ll face when you hire a dedicated IT staffer for your business:

Salary Costs

You’ll need to offer a competitive salary to ensure that you attract a great IT person – you wouldn’t want anything less than the best when it comes to your business security and network. A well trained professional can command a high salary; you’ll need to be able to cover an annual salary (along with benefits and related perks) to be able to justify hiring a dedicated employee.

If your company is big enough to have IT concerns, but not big enough to keep a dedicated staffer busy, you’ll have to find that new hire something to do during their downtime. If you are paying a salary, then you will be paying money every month, whether your employee has enough to keep them busy or not. Coming up with responsibilities that your IT team member can handle when they are not working on your network can be a challenge. Fill the downtime with too many tasks and they won’t be available to do the job you’ve hired them for – striking the right balance between enough IT work and other responsibilities can be a challenge for any business.

Benefits and Ongoing Costs

A fulltime employee costs your business far more than just a regular salary. Health insurance, workers compensation and even 401K matching programs can take a big chunk out of your budget. You’ll also need to make sure that this key employee is up to date on the latest technology and trends; ongoing certification and education costs also take a bite from your budget each year. Opting to use an outsourced team for your IT allows you to place the responsibility and the cost of these big ticket items on a third party. When you outsource your IT, you pay for the services rendered, not for benefits and continuing education for the people running your network.

Intangible Costs

When you hire a sole employee to handle your IT, your risk is naturally increased. That employee could get sick, decide to leave or even end up harming your network and business. Even a competent, healthy and loyal worker only puts in about 40 hours a week; network errors don’t always happen on a regular schedule. Having a fully resourced team on call can help you avoid expensive errors and the issues that can crop up when your network is only monitored for a few hours each day.

Turnover can be expensive too – if your new hire leaves, they take all of their institutional knowledge with them, leaving you scrambling to replace them. According to human resource experts at ERE Media, it can cost the equivalent of a year’s salary to replace a key, skilled employee. Opting to outsource your IT means your network is never left unprotected – and that you don’t have to absorb the high costs associated with replacing an employee.

Outsourced vs. In-house IT?

Outsourcing your IT allows you to reap the rewards of having a knowledgeable network expert on your team – without the expense of a new hire. If you are considering expanding and hiring a dedicated IT person, take a good long look at the numbers – salary, benefits and the intangible costs – to determine if a new hire is truly the best course of action for your business. Contact us to learn just how much you can save (and how much your business can benefit) when you outsource your IT.