Managed Service Provider or Independent IT Contractor

Which is the better business decision?

The following article discusses the implications of choosing a Managed Service Provider or Independent IT Contractor to support your organization’s IT. 

When considering the long-term management of their organization’s IT, many business leaders seek a solution that is cost-effective, flexible and reliable. Often times, this can be achieved by outsourcing the responsibility to a third-party. The most popular outsourcing options include going with a managed service provider, also known as an MSP or IT firm,  OR an independent contractor. Understanding the differences can help you figure out which choice is the best one for your organization.

Should I hire a Managed Service Provider or Independent IT Contractor?

Many business owners are unsure of what differentiates a managed service provider from an independent IT contractor. 

In order to choose the right type of third-party for your firm, you will want to understand the pros and cons of each. As the name itself suggests, managed IT service providers are typically professional firms with the expertise to provide comprehensive IT support across various aspects of your business. Independent contractors are sole agents who operate on their own schedule. They are essentially, a “business of one”.

Managed IT service providers may offer more advantages for your business than independent IT contractors for these major reasons:

• The nature of work or employment is as such that often independent contractors are used for the short term, focused on providing services that are unavailable in the organization currently and are needed on an urgent basis. On the other hand, managed IT service providers have a long-term relationship with the employers and their mode of work is more interlinked and heavily integrated with the company.
• Independent IT contractors are engaged for work in accordance with agreements and contracts only, whereas managed IT service providers are bound by the organization’s personnel policies, employee handbook and employment-at-will doctrine.
• While independent contractors may be hired for a specialized area of work, managed service providers work on a broader range of services and are there to facilitate in every facet of work in the daily operations of an organization.
• Your ability to fire an independent contractor is restricted by the terms in your written agreement with them. A decision to separate in violation of the terms is considered a breach of contract. Such a situation never ends well in court.

More reasons to hire a Managed IT Service Provider

When opting for a managed IT service provider, your business can secure the following advantages:

1. A fixed monthly payment plan with a managed service provider makes monthly cost highly predictable. This makes it easier to plan your business budget as you grow.
2. If you opt for a pay-as-you-go model, you can easily scale your business’s IT resources according to your changing needs.
3. You benefit from a team of experts, experienced in various areas of technology rather than just one person with general knowledge.
4. The managed IT service provider will have an array of tools, technology, and resources at your disposal.
5. You get support with disaster recovery and fringe benefits like web hosting, security features, and email accounts, etc.

Consider your long-term goals

Many businesses and organizations take strict measures when opting for service providers. However, if you are planning on rapidly scaling your business while ensuring that your top talent is focused on strategic initiatives, then a managed IT service provider is the right choice. Likewise, independent contractors offer cost-effective solutions for managing short-term IT requirements.

Conclusion

Both managed IT service providers and independent contractors have their place, and each usually provides suitable means to support the core competencies of a business such as assisting tools and equipment that can both be software or hardware based. The final choice depends on your business needs.