In-house IT Operations vs. Managed Services – Important Considerations for Business Owners

By Analytix Editorial Team November 17th, 2016
in-house vs managed services

How do you decide whether in-house IT operations or managed services are better for your business?

The difference between the two options is as follows:

In-house IT operations are those where a company hires its own staff and has its own infrastructure in place to support the company’s IT needs.

Managed services relies on a partnership with an outside company where the IT operations and management of daily functions is outsourced to this partner company to manage.

Which one is the better choice for your business?

Before you can determine which option is better for your business, you need to weigh the pros and cons of both systems and evaluate a number of variables, some of which are discussed below:

  • Payroll management: Payroll management is a complex task with several nuances integrated into it, including employee confidentiality. Performing this function in-house means investing significant time and attention to a task that may still contain errors and require additional work before it can be implemented.

When outsourced: Control on diverse features, such as differing work hours or leave tracking, is better managed while ensuring it is processed accurately. You save time and gain reliability at a lower cost.

  • Lack of availability of wide skill set: Skilled IT resources are expensive to hire and retain. When your IT operations are managed in-house, you need to ensure you have skilled staff to run, maintain and troubleshoot your IT department.

When outsourced: The responsibility of hiring skilled staff is no longer yours. Managed services providers ensure that their staff is up-to-date on recent trends. They also ensure the staff has a diverse skill set to meet any requirement that may arise.

  • Lack of availability of latest technology: IT infrastructure is costly to set-up and maintain. Even after you have invested a sizeable amount on establishing your IT department, you will still require updates to ensure it remains current.  This can impact both cost and time.

When outsourced: Infrastructure management is no longer your headache, and you are released from the hassle of managing updates, as well. The recouped time and money can be refocused onto business development activities.

  • Systematic tool upgrade requirements: IT requirements and improvements are constantly changing. New technologies develop, rendering the old ones obsolete. If your business is ever faced with having to evaluate cost savings and neglects even one critical upgrade, it can seriously compromise security and impact business continuity.

When outsourced: The costs, as well as the responsibility of implementing relevant and critical upgrades, are that of the managed service provider. The result is usually a robust and reliable software system.

 

Why Managed Services?

According to the CompTIA 4th Annual Managed Services Trends Study, there are several drivers for choosing managed services. A total of 224 end user businesses using managed services were surveyed. Note that this number of users includes a mix of companies with both more than and less than 100 employees.

For companies with less than 100 employees, the reasons for choosing managed services are given below.

  • 47% of the companies felt this choice improved reliability/efficiency of IT operations
  • 28% said it provided cost savings in terms of Returns on Investment
  • 25% felt it led to freeing up IT staff to work on other strategic areas within the business
  • 28% felt it allowed access to new technologies
  • 31% felt it provided for a proactive approach to maintenance

When you choose managed services over setting up an in-house system, you also benefit from the option to completely replace your in-house IT operations, or the option to choose a select few features to complement and provide additional support to your existing IT capabilities. In other words, businesses can utilize managed services end-to-end or harness them to provide help to existing in-house staff and resources.

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