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4 min read

Can IT Support Contract Costs Be Reduced?

Every business wants to reduce its costs. Over the years, I’ve talked to hundreds of Southern California business executives and many of them are concerned about what they’re paying for IT Support Agreements.

The conversation goes in one of two directions: either their provider is doing a good job, so they feel like it must be easy, or they aren’t doing a good job and the executive feels like they’re paying a lot for little gain.

If you’re happy with your current IT services vendor but it seems like your costs are going up, it’s natural to evaluate where your money is going, and to look for ways to bring expenses down.

Is there a way to reduce IT support contract, or IT services agreement, costs? Here are a few things to dig into to answer that question.

Review Your IT Support Contract

Before you can begin to cut costs, it’s important to be clear on what you’re paying for. Take a look at your IT support contract and pull bills from the last year or so.

Separate IT costs into categories, such as hardware, software, Internet, phone service, IT services, etc. so you can see which areas you’re investing in.

If it’s not clear what you’re getting in your monthly support fee, ask them to help you break it down. Is licensing for services like backup, endpoint detection and response (EDR), spam filtering, etc. included in your agreement? Are proactive and reactive services included? How about strategic planning?

If you notice that costs have gone up over time, ask why. Has your company grown? If so, you may be storing more data, more email accounts, and more computers. All of those recurring charges will go up with company growth.

Sometimes support agreements aren’t changed as business needs change. If you once needed afterhours support but don’t any more, you may consider removing that service from your agreement.

On the flip side, if you’re paying extra charges for on-demand or afterhours support, ask if it’s possible to bundle those into a fixed-fee agreement so the charges are predictable and lower.

Review Your User and Supported Devices Lists

Most IT services contracts are billed per device or per user – sometimes even a combination of both. Working with your IT provider to clean up what you’re being billed for could help a lot in keeping your costs down.

For example, let’s say you bought new desktop computers for front office employees. If the computers they replaced didn’t get removed from the supported devices list, you could continue to be charged for them. If the IT company swapped them out, they should have an inventory of current devices. If your internal IT person replaced them, your provider might not be aware.

If you’re paying per user, keep a clean list of active user accounts. Most IT companies will send you an active users list before generating your monthly invoice. Carefully review it and let them know if any users can be removed.

In that same vein, review your subscription services, like hosted email. Make sure you’re not paying for a user that doesn’t work there anymore. It could only be a couple dollars per month, but that adds up.

Determine Who Should Do Which Tasks

There’s a long list of things to be actively managed to consider IT “done.” An employee or outside company has to be responsible and accountable for the results on a daily basis. If you don’t pay the outsourced IT provider to handle it, who’s going to do it?

If you have an employee who is qualified and underutilized, this could be an opportunity for them to handle some IT responsibilities. Talk your current IT vendor to define who is responsible for what. If they truly have your company’s best interests in mind, they shouldn’t have any qualms with handing off some tasks to a qualified employee.

Related Article: Trying to figure out how much IT support contracts cost in Southern California? Check out this managed IT services cost guide. 

Improve the Environment and Reduce Issues

The cost to support your organization includes a lot of factors like the resources you use to support your IT environment. For example, if your company is using a lot of old equipment or unsupported software, that could increase the amount of failures that might occur. It makes it more difficult to provide support, and could contribute to increased costs.

Sometimes the cost of upgrading your software or infrastructure will pay off in the long run – fewer help desk calls and more productivity. If you make the investment up front, you may be able to negotiate a lower rate for your support costs.

Want to learn more? See our Managed IT Services Cost and Pricing Guide.

Evaluate Your Options

Every IT company approaches information technology management differently. Even if you don’t intend to switch companies, it could be worth getting a second opinion. Someone who doesn’t have preconceived notions about your business will ask questions, where your current vendor may make assumptions. This combined with a different approach to solving IT challenges may result in a more cost-effective strategy. 

As featured in July 30th issue of The Press-Enterprise.

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