Cost-Benefit Analysis: What is the Financial Impact of IT Outsourcing

outsourced it team using computer

In today’s fiercely competitive business world, sharp-minded financial decision-making is pivotal—and one of these important decisions is whether to use outsourced IT.

IT outsourcing has emerged as a strategic choice that could potentially reshape your bottom line. This analysis pierces through the many claims about IT outsourcing to unveil the true financial impact it could deliver to your business.

The True Scope of Outsourced IT Services

Outsourcing IT services has become a common practice for businesses of all sizes. 45% of companies planned to partner with a managed IT provider by 2024. But why are so many companies turning to outsourcing? The answer lies in the wide range of benefits it can provide.

Advantages of IT Outsourcing

IT outsourcing taps into a global talent pool, ensuring access to top-notch expertise and cutting-edge technology—key drivers of efficiency and innovation for your business. Therefore, outsourced IT comes with the following benefits:

  • Cost savings and financial efficiency
  • Access to specialized skills and expertise
  • Scalability and flexibility in resource allocation
  • Focus on core business activities

The Potential Short-Term and Long-Term Cost Savings

So what are the true financial implications of outsourcing IT? Let’s break it down into direct cost comparisons.

In-House IT

The average cost-per-hire in the U.S. is $4,129—so imagine the cost of hiring an entire in-house IT team, and the added expense of constantly keeping their skills and technology updated.

Outsourced IT

Outsourced IT services can range anywhere from $126 an hour to $209, depending on the type of service required. There’s an obvious reduction in operational costs when you compare this to a full-time IT team’s salaries and benefits.

Plus, co-managed IT support shifts the investment from CapEx to OpEx, allowing for a predictable budget with its pay-as-you-go model. This ensures your business can adapt to technological changes without heavy upfront investment.

3 Hidden Costs of Outsourced IT

By now, you’re probably thinking, “Am I missing something? Surely there must be hidden costs to outsourcing IT services.” Let’s talk about the possible risks of outsourcing.

1. Unanticipated Expenses

If not managed effectively, outsourcing can lead to unexpected expenses that can quickly add up. However, this can be avoided by choosing a reliable and transparent IT service provider.

2. Quality and Security Concerns

It’s easy to feel concerned about the quality and security of an outsourced team. Carefully vet your potential IT service providers and ensure they have proper measures in place to protect your data and systems.

3. Impact on Internal Staff Morale and Productivity

Outsourcing can potentially lead to concerns about job security and changes in workload. However, co-managed IT support can actually alleviate these concerns by providing additional support and expertise for the internal IT team.

What is the Strategic Value?

Cost reduction and financial efficiency are just the tip of the iceberg when it comes to outsourcing IT. The true value lies in unlocking more time for your internal team to focus on core business activities, while also gaining access to specialized skills and expertise that can drive innovation and growth.

Factors Influencing Cost-Benefit Analysis

The cost-benefit analysis for outsourcing IT services is unique to each business. Take time to consider the following factors.

  • Industry-Specific Considerations: Certain industries may have stricter regulations or specialized technology needs.
  • Size and Scale of the Business: Larger businesses may have more complex IT needs.
  • Regulatory and Compliance Requirements: Outsourcing can help ensure compliance with industry regulations.

How to Make Informed Decisions for Your Business

How do you decide whether outsourced IT is right for you? First, balance the short-term gains with your long-term strategic goals. Will outsourcing IT services align with your business objectives? Evaluate the overall financial impact and potential risks.

If you’re still unsure, consider alternative options or hybrid models. Co-managed IT support offers the best of both worlds, combining outsourced expertise with internal knowledge and resources. Partnering with a reliable and transparent IT service provider could be the key to unlocking strategic value for your business. So do your research, and make the best decision for your specific needs.

Partner With adrytech for Unrivaled Managed IT Support

At adrytech, we understand the financial implications of IT outsourcing. That’s why we offer managed IT support services that are tailored to your business needs. We’ll provide quality solutions and access to top-notch expertise. 

Contact us today to learn more about how we can help your business thrive.