Your business is more dependent on your IT infrastructure and support than ever before. Without the internet and reliable information in your office, you’re out of business. Without reliability and security, you can’t plan, produce, market, sell, invoice, or serve your customers. Because the stakes are high it is important to understand what you’re buying when you purchase support services. This article will look at one of the key decisions you have to make concerning information technology: whether to choose a Break-Fix or Managed Services Provider for your company. 

What The Terms Mean?

Though there is lots of overlap these two terms define two ways of delivering computer and communications services. Break-Fix refers to a model in which professional services are on call and ready when there is a problem to solve or system to upgrade. Break-Fix firms are paid based on the work accomplished. Managed Services, in its fullest expression, refers to a model in which the IT provider manages all of the information needs of the company, supplying equipment and support and providing a specified service level for a flat monthly fee. Managed services companies are referred to as managed service providers, or MSP’s for short.

Both types of IT support can work for you, but they differ in how they deliver services.  Whichever type of service provider relationship you choose, you need to know the pros and cons, so that these concerns can be addressed by involving your supplier in IT discussions.

Key Issues with Managed Services And Break-Fix

Fully managed services start with a contract that specifies what your MSP will do for you. This includes supplying all computers, networks, and may include peripheral devices such as phone systems, and printers. Larger MSPs can provide custom programming, national or global office support, 24/7 help desk and other services, either via their own staff or outsourcers. The MSP will remotely manage each desktop or mobile device, using a standard set of software. The typical contract may run for three or more years with opt-out provisions for both parties.

The MSP helps the customer by proactively preventing customer problems through remote monitoring. And, where a large number of users are involved, they reduce the complexity for upper management, effectively operating as an outsourced IT department. For the MSP this arrangement works well because in return for taking on some of the IT risk such as equipment purchases, they get a steady, visible income stream from the client. The cost of dedicated IT people with support and benefits is $100,000 per year or higher so firms must factor that in when deciding whether to use in-house, managed, or break-fix services.

For larger firms MSPs are frequently a must-have option. The costs of hiring, training and retaining a large IT staff often outweigh the costs of the managed service provider. 

The downside to managed services depend on the needs of your company. Because a managed service provider has complete access to your system—and in fact owns the underlying hardware—you are putting a lot of trust in them. We have seen worst-case scenarios in which a contract dispute led a managed service provider to turn off the office computers of a client—not a situation anyone wants to find themselves in.

 Small businesses often try to leverage existing resources and personnel to keep costs low. As a result their concerns are different than those of large firms, almost all of whom rely on managed services solely or in conjunction with an in-house IT department. And, there are hybrid models, in which the line between the two models is not so clear-cut. 

A second issue is cost. MSPS charge a flat fee for all services. Anything not included in the contract is charged at rates of $180 per hour or more. The services offered by the MSP are broad, but a small business with specific, defined needs just as well served with a break-fix solution. 

Relationships are another areas of concern. MSPs that deliver services to large companies have large staffs. When you call with a problem you may get support from someone you have never spoken to before. They know what your system is because they have the tools to evaluate it remotely, but they may not know you or your business situation well.

Break-Fix

By contrast in a pure Break-Fix model, you call on your IT support team only when problems occur. A good IT team will keep problems to a minimum, but you still pay for each service call. 

An upside to this model is that small businesses have more control over their expenses and their privacy. They may get a more customized solution than an MSP can offer a small firm profitably.  However, in the Break-Fix model you are not getting as much proactive support and planning as with the MSP model.  In addition, it is difficult to anticipate when hardware or systems may fail. Instead of cutting a monthly check you may periodically need to write a big check to replace computers or other hardware.

In the Break-Fix model you may not receive daily reporting and status overviews that full-service MSPS can provide. In addition, if your goal is to you may not have access to a wide range of services, such as custom programming, all within the same company.

Klearlogic’s Hybrid Model

At Klearlogic we deal with companies of one to forty employees and no larger. We aim to exceed customer service expectations for these firms with a hybrid break-fix model.

 Small businesses often try to leverage existing resources and personnel to keep costs low. As a result their concerns are different than those of large firms, almost all of whom rely on managed services solely or in conjunction with an in-house IT department. And, there are hybrid models, in which the line between the two models is not so clear-cut. 

In practice that means that we do more than just fix your wireless network or server when it’s down. Our goal, like a managed services firm, is to be your information technology support. We can advise management on IT decisions and help forecast your needs and purchases. We try to have the technical depth to solve thorny issues, without the associated monthly fees of MSPs. This benefits small business in several ways.

  • Costs: You pay only for services rendered with no ongoing fees on your bills. You also save the time of contract procurement or dealing with unnecessarily complex servicing agreements.
  • Autonomy: You maintain ownership of your equipment and your software. In most cases we purchase and bill you or have you purchase new equipment directly. You retain the control, the depreciation, the flexibility,  Small businesses often need to leverage existing resources and staff to keep costs low. If you have a talented person on staff, he or she can be our point of contact to solve problems quickly, saving some money. 
  • Planning: We can be your virtual IT department. We are ready at any time to sit down with you and help you make future plans or project year-end and future expenses.
  • Advice: We stay on top of trends and can research solutions that may interest you as needed. We often can steer you to new solutions or other firms that we’ve collaborated with in the past. 
  • Remote Management: Like an MSP we regularly install monitoring software so that we can log in to your equipment and solve issues. We also provide cloud backup, firewalls, and other business-level service offerings as needed by your business.
  • No Job Too Small: Our focus is computers, networks, and communications but we will help our clients with any task. If your phones, cameras, or other systems not installed by us are down, we can try to address small problems, and interface with outside repair if needed.  We want to take care of small problems for clients, so your business keeps running. 
  •  Most Important Of All: Trust. Whether you are two people in a small garage office or twenty people in an accounting firm, we want you to rely on us. We get to know your business and each piece of equipment in your office and can make personalized recommendations for the future your business.

Having said this, there are some small business offices that want or need to outsource all IT expense and cut one check per month for everything. For them, a full managed services provider works best.

Ultimately You Decide

It may seem clear to those in the industry that Managed Services are the best IT choice, but the only person who actually knows what works for your business is you. 

ItemBreak-FixHybrid ModelMSP
ContractHourlyYesYes
Planning AssistancePer projectOngoingOngoing
Repairs, UpgradesPer hourPer hourMost included in monthly fee
CrisesPer hourPer hour Per hour if not covered by contract
Remote MonitoringNoneKey systemsComplete
All equipment included in priceNoClient retains ownershipIncluded 
Software licensesRemains with clientRemains with clientManaged by MSP

About the authors: Klearlogic consultants offer personalized on-site and remote tech support and IT services to home office and small business clients.