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In-House vs Outsourced IT in 2015

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As someone who has worked as an in-house engineer, started a media business and recruited an in-house IT team, and latterly co-founded Priority One providing outsourced IT, I have seen at close hand the differences in the resultant business’s experiences of IT.  The first thing to point out, hence the title of the blog, is that in 2015 the situation is very different to when I started working in IT, back in 1997.  A number of key changes have happened over that time affecting the ability of an external company to deliver a service from a remote location:

  • Available bandwidth to remotely connect and work in real-time
  • Sophisticated software tools to take control and troubleshoot desktop computers, servers, network equipment and even mobile devices
  • Monitoring software enabling every device on a network to be tracked live remotely
  • Increasing reliability of hardware
  • The increase in utilisation of cloud services
  • Home access requirements increasing (which would normally be set-up and serviced remotely)

These factors mean that in the vast majority of cases of small to medium size businesses, the need for an ever-present IT person based on site is no-longer the case.  An onsite person is normally beneficial when the onsite only tasks will fill a full-time role.  This full time presence can be either employed directly or supplied by an outsource provider.  So given the above factors, what are the decision criteria as to which way to go?  I suggest the following are the key factors:

  • Quality of IT strategy advice
  • Cost
  • Management
  • Quality of IT support service

For me, it is the quality of advice that is key.  There are so many choices to be made with regard to hardware, software, and service selection.  Getting these decisions right will make a big impact on the total cost of IT, especially when you factor in productivity of the workforce.  The difference between an in-house person or small team providing that advice, and a company such as we are with 15 senior engineers and the collective knowledge that comes with that, is obvious.  That is 15 engineers all with different backgrounds and specialisms, serving a wide variety of different clients.  The knowledge of what hardware, software and services exist, and more to the point what works well and is suitable for a particular client is what a company such as ours specialises in.  This is a no-brainier!

It is illustrative in our experience.  When we take over the IT for a new client, most will have had either an existing IT support company previously, or an in-house person/team.  In every case, we have much work to do, to bring the systems up to our standards, but the very worst environments that we take over are invariably where there has been in-house support.  Some of the environments we take over can only be described as scary.  Totally inadequate backups and disaster recovery capabilities, woeful IT security, and dire user experiences are pretty much the norm.  We will frequently find business critical systems with multiple single points of failure that could cripple the business in the event of a failure.

Cost, is any easy one.  I can’t speak for all outsource companies, but certainly in our case we will come in at a fraction of the cost of an in-house team – we can afford to because we are expert, efficient and we have economies of scale.  Let’s look at an example of say a 50 user business and contrast the cost of a single full time mid-level IT support person against ourselves. In our experience we will typically come in at 50%-70% of the cost of employing that person. Furthermore the support cover is from 7am to 7pm on working days (24×7 available), and you won’t be without cover when illness and holiday are factored in.

Management is an interesting one. There is normally a non IT literate person that will have ultimate responsibility for the IT function in an SME.  The question is, is it easier and less time consuming managing an external provider or an internal person. Of course it depends on the quality of the company or individual.  On balance if a manger is having to make decisions on purchasing and strategy recommended by a mid-ranking internal person vs an external company which certainly should be providing a much higher level of expertise, then the answer is obvious. I would caveat this by saying that choosing the right external IT provider is by no means an easy task. It can be easy to be sold into a provider, there are many that can ‘talk a good game’.   Our belief is that when people find an IT provider they can trust they stick with them for the long term. That has certainly been proven in our case. I would bet there are few competitors than could match our retention level.

Lastly what are the factors affecting the quality of the IT support? The obvious benefit of an internal resource is that one person (or a small team) would get to know the users better than an external resource, and in the event of onsite assistance is required can attend faster, workload allowing.  However, as I said earlier the onsite requirement is now much less of a necessity. The benefits of an external resource are that they can service multiple issues simultaneously, and in our case we will be providing someone of much higher expertise than the average onsite person. We only employ highly experienced engineers, whilst many other external IT providers have junior first line and second line engineers to go through first. The real measures of the quality of support though are:

  1. Number of issues that occur
  2. Time to fix
  3. Quality of fix
  4. Preventative measures put in place to prevent recurrence
  5. Quality of communication with the user

For us, this is what we focus on. We have internal systems that measure and focus on these very metrics. The incentive for an external provider delivering a paid for service is to deliver the very highest standards of these criteria. An internal mid ranking IT person could not challenge us when measured against these criteria. The systems we have in place to measure our own performance on resolving customer issues are what we live and die by every day.

It maybe that in a few years’ time there could be less of a need for an IT support service as hardware steadily becomes more reliable and automated, the use of cloud services becomes more extensive and the usability of systems gets easier and more intuitive. In that case, companies like us will have to adapt and end up doing more hosted cloud services and training, than support. However in this current era, I believe we are in a sweet spot for external support.

Priority One – London IT Support

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Steve Thomson

With a degree in Computers and Business and an IT background in Market Research, Media Monitoring and Publishing, Steve brings a wealth of knowledge and experience to Priority One.

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