What Is Managed IT? A Complete Guide for Business Leaders

Managed IT services let organizations outsource IT tasks to a vendor on a contracted or subscription basis. The vendor will then handle the company's IT-related concerns, essentially taking charge of that department.

Many small businesses rely on technology. Whether it's their computers, Wi-Fi, email, phones, apps, and everything in between. And when something breaks? Productivity takes a hit, which feels heavier for growing companies. When this happens, you're spending your day troubleshooting instead of running your business.

Cases like this show a slightly outdated IT approach called the "break-fix." Something breaks? Call someone to fix it, pay the bill, and pray it doesn't happen again. It was once the primary method for resolving IT-related issues in small businesses. The approach typically works until it doesn't.

This is mainly the reason why Small and Medium-sized Businesses (SMBs) are relying more on managed IT Services. Instead of waiting for problems to arise, a Managed Service Provider (MSP) helps keep your systems and technologies healthy at all times. They monitor your network 24/7, keep devices up to date, and safeguard your data. MSPs are your partners.

Imagine it like this. The old break-fix approach is akin to calling for an ambulance in the event of an emergency. Meanwhile, managed IT Services is like having a doctor check up on your health on a daily basis. Oh, and the doctor is significantly cheaper than the ambulance in this scenario.

In this guide, we'll break down everything there is to know about managed IT and why so many small businesses are making the switch.

Managed IT vs. Traditional IT (Break-Fix Model)

• Break-fix is reactive, unpredictable, and leads to costly downtime.
• Managed IT services prevent problems before they occur through 24/7 monitoring.
• Managed IT services save more money in the long term by reducing emergencies and downtime.

As mentioned, small businesses had no choice but to rely on the traditional break-fix IT approach, where help is only called for when something goes wrong.

How Break-Fix IT Works

With traditional break-fix IT, you pay a certain amount depending on the problem. While it sounds cheaper up front, there are some glaring issues with this model:

• You never know when something will break or malfunction
• You never know how big the bill will be
• You only get help after something breaks

The second point is the most important thing to consider, as it's partly why break-fix is more expensive in the long run, but we'll get to that later.

How Managed IT Works

On the other hand, managed IT services monitor your devices and systems 24/7 to prevent issues from occurring in the first place. They handle updates, backups, security, and other essential tasks, keeping your business running smoothly.

With managed IT, you also pay a predictable monthly fee, rather than being billed based on the severity of the issue. 

Which One Saves More Money?

Here's a quick comparison:

For small businesses that can't afford even the slightest of downtimes, Managed IT will pay for itself quickly. After all, why wait until your car breaks down when you can get regular maintenance to prevent breakdowns in the first place?

Managed IT Service Models

• Businesses can choose fully managed, co-managed, or hybrid IT depending on needs and budget.
• Fully managed works best for businesses without an IT team, while co-managed supports overwhelmed internal staff.
• Hybrid models offer flexibility but may cost more due to customization.

It goes without saying that business needs differ from company to company, especially in terms of IT support. What your business prioritizes is vastly different from what others consider important. One of the great things about managed IT is its flexibility. You can choose the model that fits your needs and budget, while also allowing for customization.

Fully Managed IT

A fully managed IT plan means your MSP becomes your entire IT department. They'll handle everything from helpdesk support, security, antivirus, backups, and a whole lot more. It offers comprehensive coverage and is slightly less expensive than maintaining a large in-house team. 

In addition, you're also getting access to advanced tools and specialized skills.

Of course, there are challenges with this approach. For one, you won't have direct control over IT decisions. In addition, it's also dependent on vendor reliability and service level agreements (SLAs)

Co-Managed IT

Suppose you already have an in-house IT person or team. In that case, you can avail of a co-managed IT service to provide your existing team with internal support. This option is suitable if your IT person is overloaded or if you require access to specialized tools or expertise that your current team may not have. 

And don't worry about your internal IT people, they'll still do what they do best, but they won't have to do everything this time.

While convenient, co-managed IT is riskier. Firstly, this setup necessitates clear communication and a well-defined role to maximize efficiency. If responsibilities aren't well-defined, you may end up with overlaps and redundancy.

Customized or Hybrid Models

Small businesses often lack the same budget allocation for their IT departments, making the prospect of managed IT a daunting proposition. 

Thankfully, some MSPs offer customized or hybrid models. This means they can provide the help you need, regardless of the area. If you only need help with cybersecurity, monitoring, or a helpdesk, you can choose which services to utilize. 

A hybrid model provides you with the flexibility to determine what you want your MSP to handle. This approach requires careful planning and negotiation, as it results in higher costs compared to other methods due to the necessary customization.

Choosing the Right Model

As mentioned, the right model depends on your business needs, budget, internal IT capabilities, and the level of control required. If you're a small business, you'll benefit from a fully outsourced IT solution, as it reduces overhead. For mid-sized companies, co-managed IT may be the ideal solution, as it teeters a fine line between control and external expertise.

Regardless of the setup, the goal is to give your business the right level of support without overspending. Choose your plan wisely, consider all options, and assess your IT needs. 

MSP Service Levels

• Service tiers allow businesses to pick the level of support they need.
• Basic provides essential monitoring, standard adds more support, while premium offers full-service IT management.
• Higher tiers reduce disruptions and provide more robust security and uptime.

Once you start exploring managed IT, you may notice that some providers offer different service levels or tiers. Regardless of what they are called, these levels are similar to choosing a phone plan, where you select the support that matches your needs and budget. Here's a simple breakdown on how these tiers work and what they usually offer.

Basic Level

The basic level, or lowest tier, is usually the "just enough to stay safe" option. It's ideal for small businesses that are just starting to explore managed IT. Level 1 services typically involve monitoring a business's IT systems to identify potential problems, while providing basic support such as antivirus management.

This plan's goal is to prevent problems from escalating and avoid downtime, which could be fatal hours for SMBs.

Standard Level

The standard level is typically the most popular due to offering more services than basic plans while being less expensive than premium plans. This tier is ideal for businesses that rely heavily on their technology and require a plan that offers a more proactive approach to problem-solving.

Like the basic level, standard plans provide monitoring services, as well as problem resolution services, including help desk support, remote support, and on-site support.

This level offers businesses a more comprehensive IT support service to minimize the risk of IT-related disruptions.

Premium Level

As the name suggests, the premium level has the most coverage and is subsequently the most expensive. This level covers everything your business needs, from every angle. It's a full-service IT provider that offers services such as system design, implementation, and management, as well as cloud-based services, all of which are covered by the basic and standard levels. 

The premium tier also means you can be hands-off in this part of your business, allowing you to focus your time and attention on other matters.

Premium-level plans offer businesses a comprehensive IT management solution, ensuring the highest level of uptime and security.

Benefits of Managed IT Services

• Predictable costs, reduced downtime, and faster issue resolution boost efficiency.
• Access to expert IT talent and enterprise-grade tools without hiring internally.
• Enhanced security, proactive monitoring, and easy scalability support long-term growth.

Managed IT makes a world of difference, especially for small businesses. It's not just convenient; managed IT is also an investment that helps growing companies generate more revenue by minimizing downtime, which subsequently improves efficiency and productivity. Here are the biggest ways managed IT helps SMBs:

Cost Savings

The most significant benefit of managed IT is the predictable monthly pricing. You're likely paying the same amount throughout your agreement, as opposed to keeping an in-house IT team that's susceptible to additional costs such as emergency repairs and staffing expenses. With managed IT, you can avoid costs associated with hiring, training, and retaining employees.

This gives you financial clarity and control, making it easier to allocate resources where they are needed most.

Proactive Monitoring

Managed Services typically include continuous monitoring and support that ensure issues are detected and addressed early. Network downtime can be critical for small businesses, as it could cost them hundreds or thousands of dollars per hour. 

Instead of waiting for something to break, an MSP uses proactive monitoring to maintain your systems 24/7, minimizing disruptions.

Access to Real Experts

Hiring a full-time IT specialist is expensive. Hiring a whole team? Pretty much impossible for starting companies. Getting help from MSPs allows you to access certified experts and industry specialists without incurring payroll costs. 

A reliable managed service partner provides a team of experts skilled in various areas, including cybersecurity and IT project management.

Easy Scalability

The nature of small businesses is scarily volatile. You can go through a rough couple of months or experience growth like the industry has never seen before. 

Regardless of the situation, MSPs are flexible and can adapt to your changing needs, adjusting their services to match your requirements.

Stronger Security

With cyberattacks becoming increasingly prevalent, cybersecurity is more crucial than ever. In fact, SMBs are frequent targets of cyberattacks. 

Thankfully, a strong MSP keeps you protected and gives you confidence that your data and that of your customers are safe. Specifically, Managed IT helps you stay ahead with:

• Regular patching
• Threat monitoring
• Security updates
• Backup systems
• Compliance support

When Businesses Need Managed IT

• Signs include frequent downtime, overwhelmed IT staff, ignored updates, and rising cyber risks.
• Growing businesses often outgrow their DIY or break-fix IT setup.
• Managed IT provides stability, guidance, and peace of mind.

Small businesses typically miss the signs that it's time to switch to managed IT. This results in downtime and ultimately leads to a loss of revenue. SO, how do you recognize when it's time to make the much-needed switch? Here are a few signs you need to recognize right away.

Common Triggers

• Your team and business are growing, and your tech is struggling to keep up
• More frequent downtimes and slower performance
• Cybersecurity risks are becoming a genuine concern
• You start to handle increased and more sensitive customer data or face compliance requirements
• You want to modernize to brace yourself for the future, but you aren't sure where to start

Red Flags You Shouldn't Ignore

• Your IT department is overwhelmed
• Issues keep popping up again and again
• Updates and patches are ignored
• Backups are frequently unchecked or untested
• You dread the next tech problem since it results in lost time and money

If these sound familiar, even just a few, managed IT is a game-changer. You'll immediately gain stability and expert guidance that yields real ROI. 

However, the most crucial part of getting managed IT is that it gives you peace of mind. Instead of worrying about technological failures, you get to focus on what you do best: running your business.

Managed IT Pricing Models

• Per-user, per-device, and flat-rate options cover different business structures.
• Pricing depends on business size, device count, and service complexity.
• Add-ons enhance protection but may increase monthly costs.

The point has been hammered home, but managed IT offers predictable and straightforward pricing. You're not guessing how much the next tech disaster will cost. You know exactly what you're paying each month. Most MSPs use one of three pricing models (or a mix of them), depending on what suits your business needs.

How much do managed IT services cost?

There is no concrete answer to how much managed IT services cost. The final bill depends on several factors. However, here's how pricing typically works.

Per-User Pricing

This is the most straightforward and common method for pricing managed IT services. You pay a set fee for each person in your organization who uses the services. This model is ideal for small businesses because it aligns with their operational needs. If you're a growing team, you'd rather avail this model because:

• The cost scales as you hire
• Every employee gets equal support
• It's predictable and simple

Per-Device Pricing

Some MSPs charge based on the number of devices they manage, such as laptops, desktops, servers, and mobile devices. This plan gives you flexibility if your work person isn't "one person = one computer." You want to consider this model if:

• Your team shares devices
• You have lots of equipment (manufacturing, retail, etc.)

Flat-Rate Pricing

Lastly, flat-rate pricing is considered the all-inclusive approach. You pay a fixed monthly fee, and your MSP covers everything in your plan, including support, monitoring, updates, security, etc. Flat-rate pricing is ideal for businesses that want predictable budgeting and consistent costs.

Add-Ons and Extras

Add-ons and extras can also increase the cost of your plan. Of course, this means extra coverage and long-term value. Depending on your needs, you may see optional add-ons such as:

• Advanced cybersecurity tools
• Cloud management
• Compliance services
• Hardware management
• Enhanced backup and recovery

ROI of Managed IT Services

• Reduces tech issues, increases uptime, and boosts productivity.
• Prevents costly emergencies and ransomware incidents.
• Offers high-value tools and expert support for a fraction of in-house IT costs.

Managed IT's ROI is not just about the money. Services like these provide priceless returns, including reduced headaches, improved uptime, and increased efficiency and productivity. 

However, it also saves a significant amount of money. Here's a breakdown of the biggest returns SMBs see:

Lower Downtime, Higher Productivity

Managed IT monitors and maintains your system 24/7, which means things run smoothly. Reducing downtime by an hour or two a month saves thousands in lost productivity. In fact, many businesses report:

• 20 to 30% fewer tech issues
• Up to 99% uptime
• Faster response times

These improvements may seem minor, but they accumulate and lead to increased productivity.

Fewer Emergency Costs

Emergency costs are the bane of small businesses, as you're dedicating a portion of revenue to something that could've been prevented. It's part of the reason why break-fix IT is becoming a relic of the past, as every problem becomes a head-scratching surprise expense.

With managed IT, those emergencies become less frequent because experts identify and address issues early. Preventing one major outage or ransomware event can pay for an entire year of service.

Access to Tools and Talent You Don't Have to Hire

Security tools, monitoring software, backup systems, and experienced IT personnel are needed for small businesses. They protect sensitive data and your business. However, these things are expensive individually, and most startup companies can't afford two of them, let alone the entire package.

Through an MSP, you get all of them for a fraction of the cost of hiring your own team.

Ready to Take the Stress Out of IT?

Technology shouldn't slow down your business. It should be the driving force towards better success. Managed IT offers a more innovative approach to managing your technology. One that's cost-effective, scalable, and designed to promote productivity.

Instead of dealing with surprise outages and nonstop troubleshooting, you pay for a partner who keeps everything running smoothly behind the scenes. From monitoring and maintenance to security and support, managed IT services provide your business with the stability it needs for growth.

Suppose you're ready to modernize your IT operations and provide your team with the reliable technology they deserve. In that case, it might be time to export managed IT. 

Why piece together different IT vendors when you can have everything handled by Melbourne's most trusted IT provider? Our solutions offer more than just support; we provide a comprehensive approach that covers your business's technological needs.

Our managed service is simple. In fact, you only need to partake in three steps for peace of mind. 

First, we begin with a consultation to gain a deeper understanding of your business, current IT setup, and specific IT pain points. Afterward, we design an efficient and effective managed IT service plan tailored to your needs. Lastly, our internal IT team will get to work while you're free to focus on your business.

Get started and give us a call today. A 15-minute chat can transform your future into one with fewer worries and more profit!