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Cost vs Benefit of IT in Australian Businesses

Cost vs Benefit of IT in Australian Businesses

Portia Linao Portia Linao
October 11, 2022, Post a comment

Businesses continue to adopt information technology in their operations.

According to Gartner, Australian businesses will likely spend more than AUD 109 billion on IT in 2022. That’s an increase of 6.5% from 2021 with only 5.9% overall IT growth in that year.

IT has helped many businesses operate more efficiently, make better decisions, reduce costs and boost profits. But many still wonder about its total benefits and whether it could make up for its expense.

How can you balance the cost and benefit of IT for your business? How can you get the best results without compromising your budget? How can you get the best pricing without compromising quality?

These are tricky questions, and you have many factors to consider before you get your answers.

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The actual cost of IT in Australian business

IT is not cheap. That is a hard fact.

But without it, your business can’t grow to the capacity you want it to be.

When you’re managing your IT costs, every small decision matters. Each decision should be the right one, especially if you’re a small to medium-sized business with a tight budget.

You can go two ways.

Either hire your own in-house IT team or outsource your IT to a Managed Service Provider. It entirely depends on which option would prove the most cost-effective for your business.

In-house IT cost

There’s more to hiring an in-house team of IT professionals than just their salaries.

Consider other potential costs like training, certifications, onboarding, benefits, office space and furniture, etc.

Training and certifications are critical, considering your team needs to be up-to-date with technology to keep your business tip-top with technology.

Most small to medium-sized businesses (with a minimum of 20 employees) will need at least need a basic IT support package. It is usually composed of:

  1. One IT technician that handles hardware or software installation, maintenance, and troubleshooting.
  2. An IT manager who manages, coordinates, and plans IT-related processes in a business.

According to Talent.com, the average annual salary of an IT manager in Australia is $135,000, while IT Technicians make a little over $74,000. That’s a total of $209,000 worth of average annual salaries for only two positions. And that's excluding insurance, benefits, training, and operational costs.

As your business grows, so will your need for IT support. You will need more people to handle the day-to-day troubleshooting tasks and administrative IT issues. You'll also need to account for hardware, software, and overhead costs.

Although an in-house IT team can be costly, it does have its advantages. According to Inhouse CIO, hiring a full-time IT staff lets you have complete control of your IT and you get to have someone on-site to help you resolve IT issues ASAP.

Outsourced IT cost

Businesses from all industries can outsource their IT to Managed Service Providers (MSPs).

But the million-dollar question is how much does it cost?

It is a tricky question considering there are multiple factors involved that can make up the cost of your IT. You need to account for the service(s), the number of seats, types of devices, software, licences, and upgrades you want to use, and the MSP's pricing model. Depending on your package, you may sometimes have to include ad-hoc support, a service priced by the hour.

The projected cost of outsourcing IT varies, but they commonly range around $70 - $300 per user. Sometimes it can go higher or lower than that along with the other services you may want to avail yourself. MSPs typically have IT managers willing to draw up a tailor-fit IT package based on your business objectives and budget. You should get a reasonable quote that you can consider.

MSPs in Australia usually offer packages with various IT support services that will allow you to choose which pricing and services best fit your business.

Office Solutions IT offers two pricing models ideal for all business forms and sizes:

Essential IT Support

The essential IT support offers an ad-hoc support package that aims to get you back up and running as soon as possible.

It's as simple as that.

Fun Fact: We respond to high-priority incidents in only 3 minutes and 18 minutes on normal incidents.

That's crazy!

Essentials IT Support is perfect for businesses with minimal IT requirements. One example is setting up, configuring, or upgrading a software application.

Its total cost depends on the job's complexity. But for starters, Office Solutions IT charges $175 per hour on ad-hoc support.

The whole idea for Essential IT Support is to get you back up and running better than ever before. It's the kind of IT support that you can rely on.

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Managed IT Support

Although Managed IT offers wide-ranging support for your business, it does cost a bit more than a ad-hoc package. 

The upside is you get 24/7 IT support, access to a dedicated partner, threat detection and monitoring, and many more.

The Managed IT Support package is ideal for businesses who want to outsource their entire IT to an MSP. It's also perfect for businesses that already have an in-house IT team but wants to expand their technological capabilities with the help of a third party.

This package has services not usually offered on the Essential package, such as:

  • monitoring & maintenance
  • set & forget IT
  • software updates
  • 24/7 IT helpdesk
  • service requests
  • hardware, software, or service installations
  • on-site maintenance
  • IT consultation

FYI: Similar to Essentials, you can also cherry-pick services in the Managed IT package. That way, you only pay for what you need at the moment. But of course, you can always level up your package whenever the need to comes up. 

OSIT charges this package on a per-user basis plus the other services you have on your package. Your designated IT Manager will provide you with a quote based on the services you want to acquire, the business objectives you wish to achieve, and of course, your budget.

Then, you will be assigned to a team of experts who will take care of your IT for you.

With Managed IT, I guess it's safe to say that you can wave goodbye to your IT headaches and say hello to a set-and-forget IT support setup. 

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Benefits of IT in Australian business

IT has brought business operations to a whole new level. Australian businesses of all types and sizes produced significant results that helped them grow and reach their customers. IT pays on its own in a matter of time, whether you went with an in-house IT team or an MSP.

IT is understandably expensive. But it has proven time and time again that it can deliver significant ROI in terms of staff productivity, internal operations, data security, and a whole lot more. Although the list below is not exactly ground-breaking, it will emphasise how conducting a cost/benefit IT analysis has effectively improved (and is continually improving) Australian businesses and how it will help you get to your goals.

Efficient Operations

IT has enabled businesses to optimise their operations where they can automate repetitive tasks from accounting and human resources to administration and customer support.

With the implementation of business software, you can make internal processes more seamless within/between departments. Collaboration would be a piece of cake, data would be more accessible wherever or whenever, and getting work done would be more seamless than ever.

The right tools and implementation will help your business move forward through innovation and help you develop better-quality products/services to increase customer satisfaction.

Smoother Communication

Effective communication is an integral part of business success. Businesses that use IT for communications can collaborate with teams and connect with clients more effectively. If you’re in a highly competitive industry, this component is a critical factor to your success in keeping your staff in check and making clients happy.

Communication comes in various forms. It could be about a fast and stable internet connection, VoIP-integrated phones, live chat, or email. It’s vital to have a reliable communication channel and a backup alternative if those are not available. Remote and hybrid work models rely heavily on communications since it allows collaboration and data transmission between teams, even if they’re in different regions across the globe. On top of that, human resources can cut costs on real estate, utility, office furniture, and more.

Reduce Operational Cost

Let’s be honest here.

IT is expensive.

We’ve had conversations with too many businesses that hesitate to go with IT because it can be costly on some occasions. But we get it. Change is always scary, but not taking the opportunity to grow your business to new heights is even more terrifying.

Yes, IT may require a bit of an investment, but it will pay itself off in the long run if implemented correctly according to your business objectives.

One of the many ways your business can benefit from IT is that it reduces operational costs.

How so?

Do you remember those tediously repetitive tasks that take up hours of your time? IT can automate those for you so you can focus on more important things. They’re less likely to succumb to human errors. So not only are you getting things done faster, but you’re also producing more accurate work.

Reducing operation costs is just one of the many great things about implementing business IT.

Remember communication costs? Labour costs?

Yes, they are also indirectly affected by good IT integration.

Summed up wisdom

IT is not a magical tool that will fit every business problem you have, although it would seem that way if integrated correctly based on your needs.

There’s no universal formula as to how you can utilise IT to your benefit. It will ultimately depend on how you use it to your advantage and get the results you want.

But before any of that, you need to change your outlook toward IT.

Instead of seeing it as an unnecessary expense, view it as a tool that you could use in your strategy to make your business stronger by hitting goals. Because if IT gets done right, its return on investment will come waving sooner than you might think.

If you want to learn more about the cost vs benefit of IT, how you can get the most out of your IT budget, or how you can make your business thrive, just reach out to us, and we’ll get in touch with you soon.

 

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