Reduce IT Management Costs and Complexity with Managed Services
For the better part of two years, companies have fast-tracked technology initiatives to meet remote work requirements. At the same time, however, the ongoing “Great Resignation” continues to exacerbate chronic IT staffing shortages that place many of those initiatives in jeopardy.
According to the most recent figures from the Bureau of Labor Statistics (BLS), the number of American workers quitting their jobs hit record highs in November, with 4.5 million people leaving the workforce. The tech industry has been particularly hard hit, with annual turnover rates approaching 20 percent.
The loss of in-house expertise is undermining IT modernization efforts. Three-quarters of organizations that start a modernization project fail to complete it, according to the 2020 Global Application Modernization Business Barometer Report.
Budgetary limitations sometimes prohibit organizations from hiring additional staff with the right skill sets. According to Glassdoor, the average annual salary for an in-house network support technician in the U.S. is $66,000, although top candidates can command more than $100,000. However, salary only represents about 70 percent of the true annual compensation for a full-time employee. Here are some of the other costs the BLS says you can expect to incur for someone with a $70,000 annual salary:
• Insurance. Health, disability and life insurance benefits will add about $8,000 per year to the compensation package.
• Legally required benefits. Unemployment insurance, Social Security, Medicare and workers’ compensation expenses add another $7,600 per year.
• Paid leave. Vacation days, holidays, sick days and personal days account for $7,300 per year.
• Supplemental pay. Overtime pay, shift differentials and bonuses can add another $3,500 per year.
• Retirement and savings. 401(k) contributions, administrative fees and miscellaneous fees for investment advice and consulting will cost about $3,600 per year.
There are other expenses as well. For example, you can expect to spend more than $1,500 per employee on training and onboarding. Additionally, there is ongoing training and professional development. Testing for common IT certifications can range from about $100 to several thousand dollars, although instructor-led classes and study guides will up the price.
Outsourcing IT functions to a managed services provider (MSP) is a proven way to gain the IT expertise you need while also addressing cost and complexity concerns. Qualified providers have the engineering resources, advanced tools and vendor connections to support most any IT initiative. The MSP agreement will outline the services to be performed and the results to be produced for a predictable monthly fee.
Surveys consistently show that companies can reduce their annual IT expenses with managed services. Here are some of the ways an MSP can impact your bottom line:
• Rein in staffing costs. Working with a provider relieves you of the need to recruit, screen, interview and onboard new IT employees while eliminating expenses for salaries, benefits, training and tools.
• Reduce downtime. With around-the-clock monitoring services, regular maintenance and rapid problem resolution, an MSP can minimize business interruptions.
• Enhance operations. An MSP can help you leverage the latest technologies to increase productivity, improve efficiency and create a competitive advantage.
Even if money were no object, skills gaps are practically inevitable due to the pace of IT innovation. Changes occur so rapidly that busy in-house IT teams can struggle to keep up with the latest processes, systems, and solutions. By partnering with SSD, you can relieve budget pressures while leveraging our investments in technologies, tools, and expertise. Contact us to learn more.