Are Internal IT Departments Dead?

There, I said it. It became clear in a recent conversation I had with a business owner that the future of the in-house IT department is limited at best.

The client in question owned a business with over 40 full time employees, including its own IT department of about three people and Tim (not his real name), the IT manager. But I’ll talk more about this in a second, because I have a question to ask you.

Why is McDonalds is successful? Don’t look down yet, I want you to ask yourself why.

This is a tough question for most people. You know, because the food sucks. So it’s not due to the quality food, nor is it cheap (anymore).

It’s because it is so consistent. The service provided as well as what you get—it’s the same! No matter where in the world you are! Isn’t that just a little crazy?

Consistent, predictable– a staple option for when you just want a quick bite. And what is it that makes this possible? GREAT SYSTEMS! When your teenage son or daughter get their first job at McDonalds, they undergo the same exact training experienced by everyone else. It’s ALL documented in a pretty scary-thick training manual.

So let’s return to the business owner, and the tumultuous history of their now-gone IT department. When all IT staff were at the ready, the ship sailed just fine. But one day Tim, their experienced IT manager, abandoned ship for a better offer. With two weeks’ notice, this created considerable problems.

For one, Tim had not found the time or inclination to document procedures. Verbal communication and emails meant Tim left with most of that information in his brain. What followed Tim’s departure was grim, to say the least. The cost of their IT department on the business skyrocketed. Costs like:

• Hardware and software. Tim had formed relationships with suppliers, and understood the discounts and when to order. When Tim left, sporadic sourcing pushed costs way up.
• Maintenance costs. By not maintaining hardware and software, more bugs and failures began to pop up. This meant more down time for staff, and a frustrated IT support team.
• Training. Because the IT department was now so busy, the owner hired another technician. With no documented procedures, it was up to the existing IT team to train them up, frustrating for all involved. Most staff usually take a few months to settle in and be independent performers, and that costs you money. If you couple that with the need for other staff to train them, to fill them in, then that cost continues to go up.

Now this post is not suggesting Tim was at fault, nor can business owners always predict these things will happen. We hire people we like, and who are good at what they do. Sometimes life, and these situations, just happen. It’s a learning experience for all involved.

That’s kind of why companies like Greenlight exist. Managed Service Providers offer some distinct advantages to keeping IT Support in-house.  Here are just a few:

• No key-person risk. MSP’s have one job, fixing or looking after your technology needs. That’s pretty much it. We need more IT managers than other companies, and document everything. That means consistency in the service we provide, and that if someone internal moves on, it does not affect our clients.
• Economies of scale. With a bigger team servicing more companies, MSP’s offer leverage. Reduced costs to you as a business owner, AND you get to tap into the ‘cream of the crop’ when it comes to expertise.
• Better use of YOUR resources. You can invest the money you would spend on an IT department into things that make more sense for your business. Whether it’s a bigger or better sales or marketing team, or R&D to make your products and services better than the competition. Whichever way you look at it, you get better results for less money.

Do you agree or disagree? Let us know. And if you’ve got your own IT department in-house, give us a call on (02) 8412 0000. We may just be able to save you some money as well as a few headaches.