How Can I Measure the ROI in Managed IT Services?

Key Takeaways:

Looking to justify the expense of your new managed IT services contract? Here’s How to measure the ROI in managed IT services:

• Find out what’s important to your senior leadership, such as improved customer experience, reduced downtime, reductions in IT overhead, increased operational maturity, and speedier IT service. Begin your ROI story here.
• Find the baseline that will show where you are now, so you’ll have metrics that will be good for comparison, Set these metrics up in a way that will make it easy for you to slug in numbers as your IT contract continues.
• Calculate direct benefits, such as reduction in your IT costs and service ticket turnaround times or improved productivity.
• Calculate indirect benefits that aren’t immediately apparent, such as less time/money spent in IT recruiting, improved compliance structures that have led to being able to pursue new industry verticals, and improved site speed that’s led to new customer services or new leads converting.

Tell a story that shows the holistic impact of IT on your entire organization, and you’ll get a leadership team that’s ready to invest in a new, better way of doing IT.

How Can I Measure the ROI in Managed IT Services? A Closer Look

Businesses worldwide are catching on to cost savings and operational boosts from taking their IT to an outside firm. So much so, that the global managed IT services market is predicted to double to $834.7 billion in 2032. (Statista) But how can you provide meaningful, trackable proof of those business gains to your C-suite?

Fortunately, there are ways to track the Return on Investment (ROI) of your managed IT contract. The key is drilling down to find all the ways your IT MSP is lowering your costs, increasing your productivity, and building your business.

Understanding ROI in Managed IT Services

What is ROI?

In the simplest terms, ROI is a measurement that shows whether an investment in your business has paid dividends to the organization in the form of profit, increased business opportunities, or a reduction in operational overhead. For your senior leadership, this kind of tracking is critical. It determines whether they’ll make an investment in the first place or continue to invest over time.

Often, that ROI calculation is as simple as determining the new profit the investment has brought into the company. But when you justify a complex investment in Managed IT services, you’ll need to be far more nuanced. Here are the types of services you’ll need to account for.

The Managed IT Services Contract: What You’ll Need to Measure

Working with an IT support provider is generally a deeper partnership than a standard vendor relationship. At its best, an MSP can bring value to your entire IT infrastructure and information technology platforms. So, when you’re calculating ROI for your managed IT services, you’ll need to consider everything your MSP might be doing for you, including:

• Managing Your Network: This involves ensuring that your systems are properly configured to your needs, connected securely, and running properly. They also manage incoming alerts, updates, patching, and many of the workday tasks that take so much time for an internal IT staff to manage.
• Building a Responsible, Secure IT Architecture: Continuously surveilling your systems, including managing a mosaic of cybersecurity tools that scan for threats. They manage security alerts, remediate threats, and help you create a cybersecurity strategy that stays ahead of risks.
• Round-the-Clock User Help Desk: This desk provides 24/7 technical support to end users and your IT staff so you can address matters quickly. Your MSP may require a higher fee to offer coverage outside business hours, so be sure to get clarification on this point.
• Protecting Your Company from Data Loss: Create a network of on-site and off-site backups to protect your business against data loss, outages, and other threats to its continuity.
• Building Your Cloud Productivity Platform: Managing cloud infrastructure to ensure scalability, security, and efficient resource utilization
• Compliance Consulting: Offering high-end consulting services around cybersecurity compliance with CISSP-certified vCISOs (virtual Chief Information Security Officers). These experts can create a cybersecurity plan and compliance structure so their clients stay within regulatory guidelines for their industry.

The IT Benefits You’ll Need to Keep in Mind for ROI

When calculating the ROI of managed IT services, it’s important to ask yourself some key questions about how the benefits of this contract are affecting your organization.

• How has this IT MSP improved our ability to strategically plan for the future? Have they presented a better or more comprehensive IT Annual roadmap than we have had in the past?
• Has the IT MSP uncovered risks and system vulnerabilities that could have cost us money or opportunities as a company?
• Has this outside IT contract helped us contain our costs? Many MSPs offer “no-surprises” billing at a set monthly cost that helps stabilize your IT budget.
• Has this MSP provided IT expertise that we couldn’t have afforded to hire internally? Many MSPs bring heavy hitters in cybersecurity and network engineering on a scalable, fractional basis, which is a godsend to a growing organization.

By asking these questions, you’ll demonstrate the kind of holistic thinking you’ll need to convince your C-suite that working with an MSP for IT is worth the price. With all this in mind, let’s move on to the steps you’ll need to take to get meaningful ROI metrics.

Steps to Measure the ROI of Managed IT Services

Step #1—Define Your Goals and Metrics

What are the metrics that will get your c-suite’s attention? As with anything, your job is to make sure your work supports your leadership’s overall goals for the year. What numbers will they consider an important “bottom line?”

Look for what resonates. Is it reducing your department’s overhead? Or lowering the amount of downtime? Improving website speed and online customer experience? Faster service ticket resolutions?

Step #2—Start Your Story at Square One

Now is the time to set a floor. What are you spending? What’s going wrong? What kind of performance metrics do you want to point out now, that you know will improve in the future? When you begin working with your new IT partner, how do you expect that picture to change? Try to pick stats that you will be happy to use for comparison, once your MSP has started its work.

 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, of your internal IT positions
• Lower HR/recruiting/training costs for internal tech talent
• Lower costs for software and hardware, thanks to group discounts and unique 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—Put Numbers to the Benefits

Once you’ve put a number to your bottom line issues, it’s time to consider the more indirect benefits you’ll get with this new IT partnership.

Lean into the narratie about your IT MSP’s many positive, down-wind business effects for your company, 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:

It’s difficult to put a number to the data breaches that don’t occur. However, if enhanced cybersecurity protocols qualify your company to pitch a new, security-focused market vertical, like healthcare or manufacturing, for the Department of Defense, then tabulate the upmarket potential. Look at how your MSP has helped your company comply with the regulations you need to compete in these new industry verticals.

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 monitor 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 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.