How Can I Measure the ROI in Managed IT Services? The Quick Take
Measuring the ROI of managed IT services is crucial for IT managers and C-suite leadership. Here are the key steps:
Step #1—Define Goals and Metrics: Set clear goals and identify key performance indicators (KPIs) that resonate with senior leadership, such as productivity gains, security improvements, better user experience, and cost savings.
Step #2—Establish a Baseline: Document KPIs for current IT operations to serve as a comparison point.
Step #3—Calculate Direct Financial Benefits of IT Outsourcing: Look at ways IT outsourcing will save money, such as reduced IT staffing costs, the discounts the MSP could get on hardware and software licenses, and more. Also look at the ways IT outsourcing cuts costs by saving time on tasks like responding to IT tickets, patching and monitoring, etc.
Step #4—Evaluate Indirect Benefits: Your improved cybersecurity maturity can qualify you for a variety of down-wind business benefits, such as qualifying for better cyber risk insurance, attracting new clients and better vendors, eligibility to venture into more highly regulated industry verticals, and better user experience/client satisfaction.
How Can I Measure the ROI in Managed IT Services? A Closer Look
Businesses are spending more than ever on managed IT services. In fact, in 2025, businesses are projected to spend over $396 billion on managed IT services, with the market growing to $834.7 billion by 2032.(Statista) Why do they do it? Because IT outsourcing saves company money, time, and headcount. If you’re wondering “how can I measure ROI for managed IT services at my company, read on. This article will dig deeper into the metrics you can use to measure your gains from IT outsourcing
Why is measuring ROI Crucial for IT Managers and C-suite Leadership?
The old adage “you can’t manage what you can’t measure” definitely applies when it comes to investing in an IT MSP partner. For IT managers and C-suite executives, understanding the return on investment (ROI) of managed IT services is essential. It allows them to justify expenditures, make informed decisions, and demonstrate the value of IT investments to stakeholders. Measuring ROI helps in assessing the effectiveness of these services in enhancing operational efficiency, reducing costs, and driving business growth.
Understanding ROI in Managed IT Services
What is ROI?
ROI, or Return on Investment, is a performance measure used to evaluate the efficiency or profitability of an investment. It is calculated by dividing the net profit from the investment by the initial cost of the investment, typically expressed as a percentage. ROI is crucial in business decisions as it helps determine the financial benefits gained relative to the amount invested.
Why Measure ROI for Managed IT Services?
Measuring ROI for managed IT services is essential for several reasons:
- Justification of Costs: It helps justify the costs associated with managed IT services by demonstrating their financial benefits.
- Informed Decision-Making: Provides data-driven insights that aid in making strategic IT decisions.
- Performance Evaluation: Assesses the effectiveness of IT services in achieving business goals.
- Stakeholder Communication: Facilitates clear communication of IT value to stakeholders, ensuring continued support and investment.
By understanding and measuring ROI, businesses can ensure they are getting the most value from their managed IT services, ultimately leading to better resource allocation and improved business outcomes.
Key Components of Managed IT Services
Core Offerings
Managed IT services encompass a broad range of functions aimed at optimizing and securing a company’s IT infrastructure. Here are some typical services included:
- Network Monitoring and Management: Continuous oversight of network performance to ensure optimal operation and quick resolution of issues
- Cybersecurity Services: Implementation of robust security measures, including firewalls, intrusion detection systems, and regular security assessments to protect against cyber threats
- Help desk Support: Providing 24/7 technical support to resolve IT issues promptly, ensuring minimal disruption to business operations
- Data Backup and Disaster Recovery: Regular data backups and comprehensive disaster recovery plans to safeguard against data loss and ensure business continuity
- Cloud Services Management: Managing cloud infrastructure to ensure scalability, security, and efficient resource utilization
- Compliance Consulting: Premium managed IT service providers also offer high-end consulting services around cybersecurity compliance, offering CISSP-certified vCISOs. These experts can create a cybersecurity plan and compliance structure, so their clients stay within regulatory guidelines for their industry.
Additional Benefits
Beyond the core offerings, managed IT services provide several additional benefits that enhance business operations:
- Scalability: Managed IT services allow businesses to scale their IT resources up or down based on demand, so you never pay for more
- Strategic IT Planning: Providers offer strategic consulting to align IT initiatives with business goals, helping companies plan for future growth and technological advancements
- Cost Predictability: With managed IT services, businesses can benefit from predictable monthly costs, making budgeting easier and more accurate
- Access to Expertise: Companies gain access to a team of IT experts with specialized knowledge, reducing the need for extensive in-house IT staff.
Steps to Measure the ROI of Managed IT Services
Step #1—Define Your Goals and Metrics
To measure the ROI of managed IT services, start by defining clear goals and identifying key performance indicators (KPIs). Goals might include reducing IT costs, improving system uptime, or enhancing security. KPIs could be metrics like downtime hours, incident response times, or cost savings from reduced staffing needs
Step #2—Establish a Baseline
Having a baseline is crucial for comparison. This involves documenting the current state of your IT operations, including costs, performance metrics, and any existing issues. Historical data on IT expenses, system performance, and incident frequency can serve as a baseline
Step #3—Calculate Direct Financial Benefits
Outsourcing your IT can offer your business many tangible benefits to your bottom line IT budget, including:
- Elimination of overhead for many, if not all, your internal IT positions
- Lower HR/recruiting/training costs for internal tech talent
- Lower costs for software and hardware, thanks to group discounts and special partnerships your MSP may have with vendors
- Better management of inventory and licenses may help eliminate waste in your information technology and infrastructure
Step #4—Evaluate Indirect Benefits
Once you’ve put a number to your bottom line issues, it’s time to think about the more indirect benefits that come from IT outsourcing. An outsourced IT department is often more mature, well-rounded, and well-equipped with experts than your internal department might be. This level of operational maturity creates many positive, down-wind business effects, such as:
Less Downtime:
Faster resolution of IT tickets means less downtime. Measure ticket time resolution and incident reduction, and keep track of time saved.
Enhanced Security Compliance:
The Increased security an MSP can bring you will lead to fewer regulatory reviews/remediations and easier qualification for cyber risk insurance.
New Market Opportunities:
Managed IT services provide enhanced security measures and ensure compliance with industry regulations, reducing the risk of data breaches and associated costs. It’s difficult to put a number to the data breaches that don’t occur. However, if enhanced cybersecurity protocols qualifies your company to pitch a new, security-focused market vertical, like healthcare, or manufacturing for the Department of Defense, then tabulate the upmarket potential.
Improved Customer Satisfaction:
Better IT services lead to fewer disruptions and faster response times, improving overall customer satisfaction and retention. Surveys of external customers and employees will help you keep tabs on user experience and sentiment, and provide trackable metrics.
By following these steps, businesses can effectively measure the ROI of their managed IT services, ensuring they are making informed decisions and maximizing their IT investments.
Need an IT Partner to Help You Measure the Cost of Managed IT Service ROI? Integris Can Help.
As a national managed IT service provider, Integris has hundreds of qualified IT professionals at the ready to help. Our experts can help your business build an ROI-focused IT operation that moves the needle for your company. Contact us today for a free consultation.
