When companies are considering outsourcing some or all of their IT support to a managed services provider, cost reduction often comes up as a selling point. Still, often times IT support resources or firms will state a blanket “we will save you x percentage.” However, they never explain how MSPs save you money.
At Orion, we believe that each client is has different requirements and processes that makes their business run. This means that the ways in which MSPs help to reduce costs are different from business to business as well. Your managed services provider should be looking for a solution that will work with your specific business needs, not re-iterating what they have accomplished for a completely different business.
In this blog post, we are going to cover a few things. First, we are going to take a quick look at how much money organizations are saving overall by switching to managed services. Then, we are going to talk about the various ways technology spending could be reduced.
Do MSPs Save You Money – A Quick Look at the Numbers
As we mentioned above: the way in which cost savings occur when IT support is outsourced to a MSP varies from business to business. However, recent studies have shown that regardless of how these savings are found, most companies do save money with managed services. In fact, a CompTIA survey of over 400 businesses who utilize some sort of managed service reported that
- 46% have reduced their budget by 25% or more
- 13% of the above cut IT spending by more than 50%
- 50% said they have cut annual costs by anywhere from 1% to 24%
These are not insignificant savings by any means. So, while different approaches may need to be taken for different organizations, the questions as to whether or not it is possible that MSPs save you money seems to be answered.
But as we mentioned in the opening paragraph, there is no cookie-cutter formula for getting all businesses to this level.
Ways MSPs Save You Money
Increased Uptime & Reliability
Downtime and un-planned technical issues can cripple any organization’s productivity level, which in turn affects their bottom-line. Every minute that employees are trying to fix a technical problem, they are spending not working on something that is directly making the organization money. Remote Monitoring and Management services offered by most MSPs keep an eye on your systems 24/7.
Improved Vendor Relationships
A typical business environment consists of devices that range in a wide variety of brands and types. Unfortunately, this leads to another variation: vendors. Effective vendor management requires that separate contracts and pricing structures be maintained simultaneously. It also usually leads to different warranty limitations and schedules, all of which have to be tracked and maintained. These extensive details often lead to mistakes. Whether it be missing out on an upgrade or patch that voided your warranty, or not getting the best pricing, costs of poorly monitored vendor relationships and asset tracking add up fast. When you outsource your vendor and asset management to a MSP, this will be taken care of for you. Additionally, MSPs save you money through purchasing your IT supplies at volume or wholesale prices through specialized relationships with technology vendors.
Technology requires preventative maintenance in order to continue to operate efficiently. MSPs save you money by including this maintenance into their price, whereas some “call when there is an issue” support firms do not. Common issues such as updates and patch releases need to be administered in order to optimize on the lifespan of a device. Hardware limitations such as available RAM and network bandwidth also need to be monitored so that any lapse in their performance can be prevented. By maintaining these issues proactively, you can limit the inconvenience of having to take time out of your workday to deal with them.
Improved Business Processes & Efficiencies
Overtime, business processes get altered as people try to find the way that works best for them to complete a task. Unfortunately, this can lead to inconsistencies and inefficiencies that dramatically effect employee productivity. A MSP can help you standardize these processes in an efficient way that saves you time and money.
More Strategic Technology Planning
Understanding how to align your technology goals and purchasing decisions with your overall business goals is a very strenuous task. For someone without extensive technical experience, it can seem a lot like understanding how the banana you had for breakfast relates to the brakes in your car. A MSP company that can offer CIO Services can provide this to you without the added cost of hiring a CIO.
Improved Security Posture
Efficient IT Security measures prevent costs in countless ways. This should come as no real shock to anyone. From legal penalties associated with client data breach or compliance violations, to permanently lost critical business data, maintaining the security of your IT is critical to your business’ future. A MSP can offer managed security services that will ensure the security of your systems, and help protect you in the event of a data breach. This can be accomplished through a wide range of services, such as disaster recovery planning or making sure your data is backed up in the cloud.
All in all, MSPs save you money by decreasing the amount of time you have to spend maintaining your IT. When all of this is taken care of for you, you can spend time working on your core business function.
Are you interested in learning how a managed services provider could help your organization save money? Contact Orion today to learn how we can help you.