Power to the People!
How can partnering with an outsourced IT support provider cut business costs? We thought you’d never ask!
Modern technology has broken down many of the barriers a new or small business has to overcome to grow. It’s a fundamentally good thing for America. 44% of our economy is generated by small businesses according to the SBA.
If you’re willing to wrestle with technology you are rewarded with a much more accessible path to success. Previous generations of business owners did not have these tools.
However, not everyone is an IT-savvy keyboard warrior. Despite a massive push to make user interfaces more intuitive and systems easier to administer, technology systems are as complex as ever.
That’s not necessarily a bad thing. These systems can execute a wide variety of complex tasks at breakneck speeds when properly utilized. Simply put, a bike is easier to operate and a lot less complex than a car. But we all know a car will get you much further much faster. With that in mind, let’s talk about how to get your technology to work for you, increase your profit margin, and improve the day-to-day experience of your employees.
Eliminating Unnecessary Software Costs
Software License Audits
There are a lot of really talented business owners and entrepreneurs in the world today that I admire. I’ve noticed that they all have something in common: they spend money on what works without hesitation. This includes software, modern business platforms, and using IT service providers to cut business costs.
Yet technology remains a bit of a mystery to people in general, and it can be VERY touchy. If it is not costing the business a lot of money upfront, many owners and operators will not review their software license counts. However, doing so can result in significant cost savings.
Modern productivity tools like Microsoft 365 and Google Workspace are looking to exploit this behavior by running on a per-user cost monthly. I’m not saying Microsoft and Google are the bad guys, but they’re definitely looking to profit from poor user habits. Thus the challenge lies in the management and auditing of these systems routinely to keep them cost-effective.
Mismanagement of Licenses
Let’s say you’re a small business running on Microsoft 365 Business Standard ($12.50 cost per license monthly). Let’s say you have 15 licenses. 3 of these licenses are used on accounts that should be shared mailboxes or groups, which bear no cost. You also recently let two of your sales reps go, but their accounts haven’t been shut down. You’re forwarded their mail to someone else for now. If you shut their accounts down, how do you keep the forwarding mechanism online?
If you don’t correct the issue in a 12 month period, let’s see what it really costs you:
$12.50 x 5 = $62.50 Monthly cost
$62.50 x 12 = $750 Annual cost
The Hidden Cost of Software
Now $750 isn’t monumental, and that’s what makes it dangerous. Year over year it adds up. How often do you migrate your email provider? The answer for a lot of businesses is never. Operating like this for several years, it quickly becomes several thousand dollars of wasted revenue for your business.
How many other platforms with the monthly billing model are you running? 5, maybe 10? The problem now has a multiplier.
A 5-year-old business can easily waste 10k in software licensing during those early years of operation.
Picking the Wrong License
People overspend on software licenses because they don’t understand the type of licenses they actually need. Did you buy a higher-priced version of Microsoft 365 because you got some bad advice? How would you even know if it was bad advice?
I’ve seen businesses who needed Microsoft 365 Business Standard licenses at best, but their previous IT service provider advised them to purchase a much more expensive E5 license so that they could make a high-profit margin. That’s a pretty despicable thing to do, but it does happen.
In that case, it’s not 5 users’ accounts that you’re overpaying for. It’s EVERY user account that you have active that is costing you more than it should. As your business grows the problem just gets worse.
A trustworthy Managed Service Provider like IT Ninjas can assess your business and audit your current software licenses. We want to make sure that you’re not overspending. We have a ton of experience and knowledge when it comes to reducing license counts, effectively managing and administering these platforms, and helping you realize potential cost savings based on your use case.
Migrations and Software Resale
We all needed a website to get our business started. So we turned to providers like GoDaddy, Wix, HostGator, and Bluehost. And wouldn’t you know it? They offered an easy way to attach that shiny new domain we just bought to Office 365 or Google Workspace, which you probably had no idea how to do yourself. Plus, they gave us a great deal in the first 1 to 3 years of service. These guys are the best, right? Wrong. You’ve been played.
For example, GoDaddy will give you Office 365 for a competitive price in the first 1 to 3 years of service. However, you’ll be using an incredibly limited version of the product. Microsoft 365 is a very robust platform that offers far more than just some desktop software and access to Outlook. By using GoDaddy to purchase Microsoft licenses you are limiting the tools your business access to. To make matters worse, after that 1 to 3 year period they actually start overcharging for the licenses. There’s a great article on this written by Mr. Sharepoint on the subject that you can read here.
Unseen Road Blocks
As your business scales, you may want to use more business tools from Microsoft that aren’t available to you through GoDaddy. This means that you’ll have to migrate all of your emails and documents from GoDaddy’s version of the product to one you eventually buy from Microsoft anyways. Migrations can be messy and expensive if not managed properly.
IT Ninjas is focused on the success of our partners. We know what version of each platform will make sure your business can scale with the least amount of friction. We’ve performed full-scale migrations from Microsoft 365 to Google Workspace, HostGator Email to Microsoft 365, GoDaddy Office 365 to Microsoft 365, and many other combinations. We’ll get your business to the right platform cleanly and with no downtime.
In addition, we are partners with Google, Microsoft, and 70+ other common software vendors. We can offer your business exclusive pricing for these platforms that are not available to the public.
Predictable IT Spending
Proactive Support, Patching, and Updates
Countless hours of productivity loss are attributed to a technology-related issue. How many times have you asked one of your employees if something was ready and the response was, “No, I’m having a problem with my computer.”?
Immediate loss of productivity aside, there’s a bigger picture to consider. The employee doesn’t know how to fix it, or when it will be fixed. To add fuel to the fire, another one of your employees, a manager who has their own work they should be attending to, has stopped to help out. Now you have 0% productivity from 2 employees for multiple hours. You might as well light a cigar with a $100 bill.
In this scenario having 24/7 support available to you via phone, chat, or email would be nice, and that is something that we offer. However, even better than always available support is proactive support. Your outsourced IT support Provider should be onsite or in communications with your team routinely to fix small issues before they become big, productivity-killing issues. They should also be analyzing and patching your hardware and software to keep your team running smoothly. Your business should not be getting nickeled and dimed for these services. At IT Ninjas, our proactive support and flat-fee pricing model for email, phone, and chat support keep your team running and your monthly IT spend predictable.
Professional Services
Above and beyond Support, professional services give small and medium businesses access to IT expertise, knowledge, and guidance normally reserved for corporations that can afford a fully staffed IT department and a CIO.
Onsite Support
Many IT issues go unreported until they cause something to fail because employees feel they are too busy to report them. Onsite Support provides a space and an opportunity for your team to interact with your IT service provider. It allows employees to vocalize issues around the office that were not previously reported.
That’s why we include a monthly onsite visit for many of our Jacksonville customers. We want to be at your place of business interacting with your employees directly, getting ahead of issues before they cripple your operations.
vCIO
Most small businesses can’t afford (or need) a full-time Chief Information Officer (CIO). However, every small business could benefit from having access to a CIO. From business analysis and strategic planning to systems deployment and implementation, having the knowledge that a CIO brings to the table can be invaluable in helping a business make critical decisions on what and how to leverage technology for growth and innovation.
A Virtual CIO (vCIO) allows IT service providers to offer businesses knowledge, expertise, and guidance. Which will lead to less friction as you scale your business. Making the right move can save your business thousands of dollars and a massive amount of time. It can also help reduce the heartache and costs associated with making the wrong move.
Discounted Monthly Time blocks
Is your current IT service provider dinging you every time they answer the phone and fulfill requests? On the one hand, I hate to hear that a business is having a bad experience with an IT service provider. It’s a real relationship killer when your monthly IT bill skyrockets because you actually use their services. On the other hand, I‘m happy because I know we have a chance at earning your business.
If your business is regularly using a certain amount of hours for advanced projects, or administration, you should be getting a discounted time block of hours. This helps keep your costs predictable. In addition, I encourage you to review your current IT provider’s 24/7 helpdesk’s scope of work. You can check this article out to see what level of support you should expect from a helpdesk.
There will always be scenarios where hourly rates need to be applied for certain types of work. However, that doesn’t mean that your IT spending should become inherently unpredictable. Offering discount rates on monthly time blocks is mutually beneficial. Your IT spending remains predictable, and your outsourced IT support provider can provide dedicated resources to fulfill your IT needs.
The Real Cost of Employee Downtime
There are two basic types of employee downtime that I find myself thinking about relatively often…
Productivity Loss
First is the downtime we spoke about earlier. Basically, one or more employees are unproductive routinely for a number of hours due to hardware, software, or network issues. Using the productivity loss example from earlier, let’s say your manager helping with the issue costs you $30 an hour. The employee experiencing the issue costs about half that, $15 an hour. They have technology-related issues about twice a week for an hour a pop. That makes the direct monthly cost of these issues:
$45 employee cost x 1 Hour x 2 per week = $90 weekly
$90 x 4 weeks = $360 monthly
Downtime burns cash.
So your monthly cost for direct loss of productivity for those employees is about $400. What about the other workers impacted by not having their manager available? What if you lose a contract or a bid on a project because your team couldn’t deliver on time? There is far more than the direct cost that needs to be considered. This first example can be completely avoided by partnering with the right IT service provider, one that will proactively support your business.
catastrophic events
The second type of employee downtime that I think about is associated with a catastrophic event. Whether that’s a cybersecurity breach or a total systems failure, these events completely take your team offline. Engaging the right outsourced IT support partner to develop a Business Continuity and Disaster Recovery (BCDR) plan can help mitigate the impact of these events. They can also take the edge off the impact with predictable timelines to full recovery, a tested plan for restoring your business to a functional state, and clear documentation on how your business can calmly move forward in an otherwise turbulent situation.
These scenarios will inevitably cost your business money. However, they don’t have to cripple your business and make your team frantic. You can mitigate the financial impact your business faces by partnering with an IT service provider dedicated to making your business more resilient.
We’re In This Together
Look, we’re all trying to cut costs and increase profits. Although it may sound counterintuitive, spending your IT budget with the right IT Service Provider Can Cut Business Costs, and give your business the ability to scale and increase its productive capacity.
If you’d like to learn more about how to streamline your business technology experience, contact us today. Best of luck on all of your current and future business ventures!