As a business grows, supporting the staff's IT needs reaches a tipping point where the do-it-yourself approach no longer makes sense. You must determine when the time commitment and skill level of personally supporting IT efforts results in a negative cost-benefit when compared to the opportunity cost of continuing to work with sub-optimal IT solutions. At what point is your current boot-strap approach to technology a hindrance rather than a cost-saving measure?

In most cases, your options are to outsource specific tasks or hire an IT staff person. Each has its strengths and weaknesses, and selecting one over the other involves many considerations.

This quick lesson is designed for small to medium-size business (SMB) owners and decision makers who don't have a lot of time or money to dedicate to technology.

In this quick lesson, you'll learn to recognize common indicators that signal the need for additional IT support resources. You'll also understand outsourcing pros and cons—the types of IT tasks that are ideal for outsourcing and those that aren't—and analyze the costs and benefits of hiring a full-time IT staff person.

By the end, you should be able to make a decision based on your particular environment and needs. That decision might be outsourcing, making a full-time hire or a hybrid approach. First, let's take a look at the signals that indicate you need additional IT resources.

In most SMBs, key employees take on tasks that fall outside their specific job requirements. For example, the office manager could also be responsible for updating the company's website by virtue of her experience with computers. You may have taken on the responsibility of sourcing new IT solutions because you also determine the annual budget.

At some point, the needs of the business exceed your time and ability to meet them yourself. It's fairly easy to determine when you need to hire a receptionist or an accountant, but what are the triggers that signal it's time to hire IT help?

Some common triggers are:

• High-priority projects: You've identified one or more high-priority IT projects that require time and expertise that you don't have in-house.
• Maintenance tasks: You're spending an increasing amount of time maintaining your IT infrastructure, reducing your ability to focus on core business processes.
• A cumbersome or outdated infrastructure: Your IT infrastructure has become difficult to manage due to complexity, outdated equipment and software or patchwork upgrades, and is interfering with the smooth functioning of your business.
• Knowledge drain: You're tired of spending your off hours learning how to perform complicated IT tasks rather than keeping current with your own industry.

You might find that no single trigger justifies hiring an IT resource. However, together they signal a situation in which hiring outside or additional IT help results in a more profitable business, and a business that's flexible enough to successfully adapt to market changes. The following sections examine each trigger in detail.

High-priority projects

When it's time to create a presence on the internet, or you're implementing a full-scale e-commerce solution, hiring an expert makes sense if you don't have the design and technical expertise to handle the project in-house. If your company has grown to the point that keeping customer records in a filing cabinet is no longer efficient, you need to implement an electronic and organization-wide customer contact and tracking database instead. Unless you have the time to devote to research and implementation, bringing in someone to complete the project makes sense and frees you to concentrate on other tasks.

You know your business, and you know better than anyone when you've hit the point at which the processes you've been using are no longer feasible. To decide whether any of these projects warrant hiring an outside IT resource, you need to answer a few questions:

• Is the project so critical that you can't afford to teach yourself the technology as you go? Designing and implementing a customer records system might fall into this category, because you're dealing with some of the most important information your business owns. On the other hand, setting up a simple website is a project that's low-impact enough that you can afford to make a mistake or two as you learn.
• Do you have several IT projects that you'd like to complete simultaneously? If time is a critical factor, consider hiring someone who can take care of all of your IT projects in one-, three- or six-month sessions, rather than stringing them out over the course of one or two years.
• Have you tried to solve the problem yourself and gotten lost in the technical details? There's nothing wrong with bringing in an expert to get the job done; after all, that's exactly why your clients hire your business: to do what you're best at.

Maintenance tasks

If you have a simple office network, you might spend only three or four hours every month making sure everything is working properly and all data is backed up. However, if your infrastructure involves a large company website, complex or custom applications or a more complicated network, you and other employees may find yourselves spending several hours every week updating and maintaining the system.

Common IT support tasks include:

• Server maintenance, such as applying and testing patches and updates, checking the integrity of the firewall and applying updates, performing backups and checking media and reviewing performance logs

Any office network that's connected to the internet needs someone to check and strengthen security at least every week. If your network isn't protected by a firewall and a regularly updated antivirus solution, you should hire someone who knows basic network security to set it up.

• Software and hardware installations
• Workstation maintenance, such as cleaning hard disks, running optimization tools and ensuring antivirus protection is current
• Website maintenance, such as fixing broken links, finding missing images, ensuring user feedback is answered and running usage reports

Calculate the average number of hours you and other employees spend each week performing IT-related tasks that aren't part of your role in the company. For example, let's say you spend 10 hours per week on IT maintenance tasks, and five other employees frequently spend 5 hours each, which totals 35 hours per week.

Considering outsourcing maintenance tasks if any one person spends a weekly average of 4 or more hours, or 10 percent of their work hours. A total of 40 hours or more per week is enough justification to hire a full-time employee, especially considering the benefits you'll gain from freeing your staff to devote all of their time to their respective roles.

Cumbersome or outdated infrastructure

Have you lost business opportunities or clients due to your inadequate IT infrastructure? Not bidding on a project because you failed to meet the technical requirements of a request for proposal (RFP) isn't necessarily an indication your company is falling behind. However, regularly missing business opportunities or losing one or more major clients due to inadequate internal technology is a sign for change.

Performing a major infrastructure upgrade is complicated. To fulfill the primary business objective—making the company run more efficiently—the project should encompass the following phases:

• Requirements analysis: Determine exactly which benefits you expect to achieve from upgrading your infrastructure.
• Solution research: Find a solution that meets all your requirements without saddling you with unnecessary features.
• Product sourcing: Find one or more vendors to provide the necessary hardware and software.
• Implementation: Deploy the upgrade with minimal impact on your existing system and users.
• Testing: Ensure the new system is working optimally before replacing the existing infrastructure.
• Training: Train staff members on the use of the system to ensure you meet the goal of the project.

Outsourcing companies have done many infrastructure upgrades, so they have a time-tested system in place to cover all of these points. They know the key questions to ask, and can assist you with time-consuming research and sourcing tasks. Many also include comprehensive training on the new system as part of the project cost.

Knowledge drain

Even the simplest IT project often requires a considerable amount of research. For example, installing a new network printer involves researching various printer features and options before you decide which product your business needs. Then you have to be sure that the networking options are compatible with your existing network, and learn how to set various configuration options so the new printer works optimally.

Your days are filled with managing your business, which is your first priority. If you find yourself devoting several evenings every week, or several weekends a month, to self-teaching yourself the fundamentals of IT, you should consider bringing in someone who already knows how to implement your company's IT needs.

As with maintenance tasks, calculate the number of hours you spend on average each week or would have to spend prior to a major project to fill your IT knowledge gap. Draw the line at roughly 10 percent of your work hours and bring in IT help.

The next section explores IT support tasks that are efficiently outsourced.

Technical support outsourcing, or supplementing your staff with experts, is one method of meeting business needs when the skills, knowledge or time isn't internally available. Many companies outsource short-term and long-term projects, which enables staff members to focus on core business operations.

Once you've determined that you need to hire an outside IT resource, how do you decide which tasks to hand off to the expert and which to retain in-house? There are two basic criteria to use when deciding which IT tasks can be efficiently outsourced:

• Project duration: Is the project ongoing and difficult to estimate from one month to the next, or does it have a specific start and end point with measurable goals?
• Cost: Do the costs of outsourcing the project or task exceed the expected gain, measured in time savings or in revenue?

Project duration

Specific, discrete projects with pre-determined start and end points are generally easier to hand off to an outside expert than ongoing projects that vary greatly in workload from month to month.

For example, setting up and configuring a new wireless network for your office is an example of an outsourceable project. A good IT consultant can give an accurate estimate as to how long this type of project will take and the costs involved. The amount of time required to install and configure a network doesn't vary a lot from one office to the next. Some business network requirements might be more or less complex than others; however, even those added layers of complexity are measurable in terms of how much time they will take to implement.

Ongoing projects or tasks that are routine in nature also lend themselves to outsourcing. They include:

• General network administration
• Help desk
• System maintenance and repair

It's generally less expensive to outsource IT support to keep your systems and network running than it is to hire an in-house staff person. If you select a larger IT support company, you have a team of professionals supporting you. These experts are trained on the latest IT products and often hold industry certifications (at no additional expense to you), and the IT support company is highly interested in making you a satisfied customer.

Types of tasks that are difficult to outsource

Some ongoing projects, such as maintaining a complex company website, are more difficult for a consultant to estimate accurately and are therefore more difficult to outsource. The time and effort required to maintain a website can vary greatly from one business to the next and from one month to the next. A consultant might need to spend 30 hours on updates and maintenance one month and only three hours the next month.

For this reason, you also have to spend at least some additional time managing the consultant's work to ensure they're using those hours as efficiently as possible and accomplishing your highest priority updates first. Many businesses outsource ongoing projects quite successfully. However, you should prepare for additional complexity in the service level agreement (SLA) and more time spent managing the consultant's work than you would have to for a more discrete project.

On the surface, the idea of outsourcing specific projects and tasks appears feasible. However, depending on the complexity of the project, these relationships can increase the demands on your internal resources in terms of management and oversight and cost more in the long term.

Costs and analysis

Costs and pricing structures vary widely based on the type of project you want to outsource, as well as by geographical region and even by outsourcing company. Many independent IT consultants offer lower pricing structures due to lower overhead costs, but they don't always provide the range of services like that of a larger firm.

Obtain quotes on your specific project from several outsourcing providers. In addition to the estimated cost, ensure that these items are included for a fair comparison:

• Specifics on how the company will complete your project: There's often more than one way to get the job done. You should be completely satisfied that the consultant or outsourcing firm will complete the project in an efficient and timely manner, and produce a final result that meets or exceeds your expectations, as well completely satisfies the clients expectations.
• Additional costs: For an office networking project, for example, does the quote include equipment and hardware costs? Does it include assistance from the consultant in deciding which equipment to purchase?
• Penalties and back-up plans: The outsourcing company should explain how it would handle unexpected problems, citing some examples, and whether additional costs would be involved for its services.

After obtaining quotes for your project, compare and analyze those costs against the actual costs of hiring an IT staff member. Internal costs for a new employee include but aren't limited to:

• Annual salary
• Payroll taxes
• Insurance benefits offered by your company, including health, life, disability and so on
• Other benefits offered by your company, including retirement plan contributions
• Special training

Prorate the new employee's costs to the amount of time you estimate the employee would spend on projects that could be outsourced.

You must also calculate the number of hours expected to manage the consultant versus a new IT staff member, and the cost of that level of internal management.

After comparing your results, determine if the cost of outsourcing balances the expected savings in time and effort.

Now that you understand the types of tasks that are suitable to outsource and how to perform a simple cost-benefit analysis, the next section helps you decide if a full-time in-house IT resource is merited.

Hiring a full-time IT support person is often the step businesses take after outsourcing their IT projects for a period of time. However, there are situations in which it's more efficient to skip outsourcing and bring someone in full time from the start.

The following sections examine a few common triggers that signal the time to quit outsourcing—or skip it all together—and hire a full-time IT resource.

Moving from outsourcing to hiring a full-time resource

Outsourcing IT projects can be a great way to hand off specific projects, or even ongoing routine support tasks. Advantages of outsourcing include:

• Bringing in an expert temporarily represents less risk to your business, because once the project ends or the need for ongoing support becomes less critical, you can end the relationship with relatively little fuss.
• You can bring the consultant back at a later time if the workload picks up again.

Once you've hired someone full-time, however, terminating their employment with your company is more complicated. For example, most former employees aren't willing to sign on a second time with a company that laid them off six months earlier due to lack of work.

The following are examples of when moving away from outsourcing and toward hiring a full-time IT support person makes good business sense:

• When the average time your consultant spends on ongoing projects regularly exceeds 25 to 30 hours per week: Consultants generally charge 25 to 50 percent more than the salary of an employee in the same position. If you're consistently paying for more than 25 to 30 hours per week, you may be better off hiring someone full-time.
• When your project list keeps growing as fast as you cross things off: Between project work and ongoing maintenance, you find you have enough work to keep someone working consistently full-time. In this case, many businesses save money by hiring a full-time resource rather than contracting with one or more consultants to do the same work.

Hiring a full-time resource from the start

There are some situations in which you're better off skipping outsourcing and hiring an IT support person, such as:

• When sensitive data is involved, such as customer records or other proprietary information: You should consider bringing in someone full-time rather than risking a data leak by hiring someone who, by definition, is more independent than a full-time employee.

When you hire an employee, you have more control over whether that person works off-site or takes documents out of the office. With a consultant, unless you specify these things in their contract, you have little control over their working environment. You can't assume that every location in which the consultant decides to work on your project is as secure as you'd like.

• When the project involves development of a unique product or service in the industry: Building on the previous entry, if your company is creating a unique product or service that will be a strategic differentiator in your industry, you should keep your resources internal. You can use consultants for non-proprietary aspects of the project, as needed.
• For a multi-year project that requires frequent or ongoing input: For example, let's say you're developing custom software that requires ongoing upgrades and maintenance, and you're on a multi-year implementation schedule. This type of project lends itself to hiring someone full-time rather than outsourcing.

Once you decide to hire someone full-time, the next step is to decide which specific skills you need in your IT support person.

Hiring a jack of all trades

For many businesses, hiring a full-time IT staff person means finding someone who can handle a variety of common projects, such as network installation and upgrades, website creation and possibly some custom software creation. In addition to project work, you also want someone who can perform routine maintenance on your IT infrastructure, which includes applying security patches to various systems and updating your virus and firewall software.

Most SMBs need a jack of all trades, at least until they grow to the point of needing an IT department. One of the most important things to remember when hiring a jack of all trades in the IT industry is that although you're unlikely to find the perfect candidate who has every qualification you want, anyone with a wide sampling of the skills most likely can learn the rest fairly quickly and easily as the need arises.

Wrapping up

In this quick lesson, you explored triggers that indicate you need IT support assistance, and reviewed scenarios and specific business cases that help you determine whether you should outsource tasks or hire a full-time IT staff member. Sometimes the best approach is a hybrid of the two: outsource tasks for a while, and then make a permanent hire when the workload merits it. If the project is large enough to support more a full-time employee or two or more consultants, outsource only those tasks that are easy to define, have measurable goals, are easy to budget for and require minimal internal management.