Five Ways Break/Fix IT Breaks Your Budget

 In Managed Services

Many small business owners believe that choosing to only hire an IT technician when something breaks – what we in the industry call “Break/Fix” services – is more budget friendly than working with an IT managed services provider. In fact, a recent survey by CompTIA found that only 30% of businesses use any kind of managed services to maintain their IT.

That leaves more than 70% of business owners using break/fix or in-house resources to address their IT needs and issues. There are several reasons for this, but the reason typically given is cost: many business owners consider break/fix to be less expensive than managed services because they are paying only for the bare minimum of services on an hourly basis.

In actual fact, this is often not the case. The idea that only fixing things when they are broken does make a certain amount of sense over the short term, assuming that nothing breaks. But in fact, this approach underestimates the value of IT to your business, and the true cost associated with supporting your IT needs. That’s why we’d argue that over the long term, break/fix is just about the most expensive way there is to manage your IT.

Here are five reasons why:

Downtime costs money: lots of it

When people think of break fix services, they think of the costs associated with repair services. What they don’t think about is the true cost of the downtime associated with your IT systems being down. Some estimates indicate that the repair itself only accounts for 5% of the total cost of downtime. The true costs associated with downtime include lost productivity (78%) and lost revenue opportunities (17%) – which means that “cheap” $500 break/fix repair? Might have just cost you as much as $10,000 in real dollars.

Poor maintenance = poor performance

All it takes is one breakdown to realize that when your IT is down, your whole business follows suit. Yet many business owners don’t invest in preventative maintenance due to the cost and difficulty of accessing the multitude of technical skills required to prevent issues. This virtually guarantees that your business will experience significant IT problems at some point. After all, there are numerous factors that can lead to system failure – from old, poorly maintained equipment, to out of date security protocols, and many other issues that can impact your business. Break/fix only addresses these issues after they happen; managed services prevents them from happening and helps you leverage technology to drive better business results.

Higher costs, lower service levels

When you hire a consultant to come in on an hourly basis and fix a specific problem, it’s typically the case that he will fix that problem and nothing else. Underlying causes and near term future problems are typically not addressed, which can lead to higher costs than maintaining your IT systems to an agreed upon level of service over the longer term. In other words, break/fix consultants address specific issues but not the underlying causes, without regard to longer term planning.

Junior level expertise

An hourly services firm will send a technician with the skills to fix your problem, but that problem only. Additional problems may require more hours, a different technician, or even having to outsource to another firm for problems outside the firm’s expertise. A managed services IT firm has members on staff who are experienced in multiple technical disciplines. They can look at the broader picture, fixing systems rather than individual components. They also have the depth and breadth of IT expertise to understand more strategically how IT fits in your business and how to get the most out of it. In other words, they can look beyond the scope of their narrow area of expertise to drive more value out of your IT spending.

Tracking and predictability

As a small business owner, you have enough to keep track of with yourself and your staff, without needing to also keep track of time billed by third parties. Yet, if you don’t keep track of the hours billed by your break/fix provider, it’s hard to know if you’re being charged accurately. Not to mention the fact that break/fix services are unpredictable. One month you might spend nothing, the next month you might spend thousands – creating a major headache when it comes to budgeting.

Conflicts of interest

There’s a fundamental conflict of interest when you are paying by the hour for someone to fix a problem. Hourly resources are not being incentivized to work quickly, or to keep you from experiencing future problems. Of course, we don’t believe that most in our industry do business this way, but it’s important to recognize that the hourly break/fix model doesn’t incentivize your IT provider to minimize problems. The more problems you have, the more they get paid.

These are just a few of the reasons why break/fix IT services will break your budget. Looking for a more budget friendly solution? Contact us!

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