As technology continues to evolve and expand across all facets of our lives, businesses are increasingly looking to external services to provide them with the technological support they need to manage their IT departments successfully.
According to the Professional Institute of the Public Service of Canada, the Canadian government alone has accounted for over $11.9 billion in IT outsourcing work between 2011 and 2018. In that same time, personal IT outsourcing has reached nearly $2.2 billion.
Whether government bodies, self-employed individuals, or small to medium businesses, entities of all kinds are progressively more likely to outsource their IT services than provide in-house support.
Why are companies doing this and what makes IT outsourcing for small businesses so beneficial?
What is IT Outsourcing?
IT outsourcing refers to the process where businesses hire external service providers to manage their internal technical duties and IT processes.
Outsourcing IT department responsibilities is much like outsourcing HR and customer support services, in that businesses hire third-party providers to deliver a wide range of required services effectively. IT outsourcing for small businesses is typically contracted out to tech companies, IT service providers, vendors, IT support teams, or individual consultants and contractors.
The most common IT services that businesses outsource include:
- Software development
- Application support and management
- Website development, hosting, and management
- Hardware installation and infrastructure support
- Data storage
- Data management
- Cybersecurity and encryption services
- Technical support and help desks
Why Outsource IT and When to Do So
Technology is growing more complicated and specialized as IT services continue to evolve with the latest technological breakthroughs. For that reason, many businesses need highly trained and knowledgeable individuals to oversee their IT departments and their core business processes.
However, there is a rising cost to hiring these professionals. They require a higher level of training and expertise, making it harder for smaller businesses to afford in-house IT specialists. Therefore, companies are increasingly looking outside of their operations to secure professional IT staff without the added expenses.
When considering IT outsourcing for small businesses, you will need to determine the extent of your technology requirements and the skill level of your employees. Ask yourself what kind of IT support does your company need. Are there many tasks that require specialized training and core competencies or just a broader knowledge of the industry?
Sometimes, if all businesses need are website building and hosting services, they can easily find online sites to help them manage their platforms. However, for larger tasks that are sensitive in nature, like customer information storage and financial data security, IT professionals are better equipped to offer protection against cyber attacks and make informed IT decisions.
Advantages of IT Outsourcing
Listed below are just a few of the many benefits your business could gain when they choose to outsource their IT department needs.
1. Access to cutting-edge technology in the industry sector
These third-party services and technology firms possess industry-leading equipment and cutting-edge technology to support their IT functions. As such, your small business will benefit from the use of secure routers, switches, firewalls, servers, high-speed computers, and other high-tech hardware and software.
By outsourcing your technical needs to these external sources, your company will gain significantly better equipment at its disposal without purchasing such expensive tools yourself.
2. Greater knowledge and expertise at your disposal
The ever-evolving landscape of technology means that IT professionals need to have up-to-date training on the latest coding languages, cloud-computing capabilities, encryption services, and data management. Each of these disciplines can be highly specialized, meaning a business might need a trained expert in each field. However, most companies do not have the finances to cover the wages of these professionals.
By conducting small business IT outsourcing, companies can still obtain professional knowledge and expertise without the immense payroll expenses and overall IT costs. Gaining an IT team with a high skill level and extensive experience can also translate to a better user experience for your business and its customers.
3. A higher security protocol for sensitive information
One of the biggest services that outsourced IT support services provide is the protection of sensitive data online as well as disaster recovery. Cyber-security continues to evolve as more and more phishing and hacking attacks are happening to individuals and businesses alike.
It’s essential to your business and its customers to have the proper IT security to protect financial and personal information against these risks associated with IT. If there is ever a security breach in your business, then your customers may lose faith in your services. Therefore, keep everything secure and protected with IT outsourcing.
4. Fewer operating costs
With fewer employees on the payroll and no need to buy specialized IT equipment, outsourcing IT requirements can also help your business save money. Decreased operating expenses means improved profits. With these savings, companies can either improve their rainy-day funds in case of an emergency or put the money back into the business in other ways.
Hiring professional IT teams or consultants can also be tax-deductible, depending on the situation, creating even further savings.
5. Greater job security for regular staff
The more money businesses can save from outsourcing IT problems, the more money for the business and its regular employees. A reduction in business expenses allows a greater level of security for small business owners and their workforce. On top of the financial security, quality IT support services can also improve the overall success of the business, adding further job security for your workforce.
6. Increased time and energy to spend on other business facets
When a company contracts out its information technology needs, it frees up more time for internal employees. As third-party IT providers take on the responsibility of daily tasks and operations, you and your employees could have more time and energy to devote to other essential business operations. Therefore, outsourcing allows small business owners and employees to take better control of their time management and to-do list.
7. Better IT management overall
Overall, small business IT outsourcing can benefit all aspects of your operations. As a professional IT service provider can look at your business needs in the greater scheme of things and alongside the tech industry as a whole, they can provide greater insight than you might otherwise be able to perceive yourself.
On top of cost savings, improved time management, and increased quality services, tech outsourcing providers can also help your small business with business insights and process changes that can boost your IT services and business’s effectiveness overall.
Using Technology to Your Business’s Benefit
Finding a trustworthy and reputable outsourcing partner is a must. If you plan to outsource your IT needs to a professional outsourcing company, why not also gain the benefits of using professional accounting software to help you with your business’s finances. With either one, you’ll gain extensive support from this business investment.
Track expenses like freelance and consultation work and run reports to gain business insights. Try it free today alongside your outsourced IT services to improve your business overall.