Return on Investment - A comprehensive case study comparing self-managed,
IT support on T&M and T-Care™ Managed Services.

This page is a comparative study of different methods you can employ to manage your IT infrastructure. For the purpose of comparison, we look at three different options in which you can manage your IT infrastructure: manage it yourself (Self-managed), manage through an IT support vendor charging you on a “Time and Material” basis, or you can rely on T-Care. This page discusses various facts related to achievable hard-dollar savings for a medium business having 25 user desktops, one server, one firewall, one router, two switches and two network printers. Below you will find a detailed analysis of the options available to you:

Self-managed:
Consider a case in which you decide to manage your IT network by hiring your own full-time employee who is a decent network or IT administrator. It will cost you between $40,000 and $60,000 depending on your location and the local labor rates. For this illustration, we will fix this cost at an average of $45,000. Additional costs for staff including benefits, sick and vacation leaves plus 7.5% payroll tax is about $12,975. Furthermore, you will need to purchase an IT management system and required hardware; we assume it's a one-time cost of $10,000. Your staff training on the management software would cost you $2,500 more. In sum you end up spending $60,475 annually and about $10,000 as one time expenses.

IT support on Time & Material basis:
Suppose you decide on a third-party vendor to manage your IT infrastructure on a Time & Material basis. They would charge you approximately $100 per hour with an average call time of 1.5 hr per call and $25 towards travel charges. Assuming one call logged per server per month, you could expect a total of eight calls for workstations per month and an additional two calls per month to attend to problems related to Firewall, Switches and Network Printers. You end up spending @ $2,275 per month or @ $27,300 annually on this option. In this model on an average 40% of the IT issues are managed by the vendor, the balance being handled by end users themselves.

T-Care
T-Care services would include proactive monitoring of your Servers and managing your Mail Server and Database Server. It carries out preventive maintenance on your Desktops along with maintaining Network devices for optimal performance. End-users can call on a toll-free number to inform the provider of their day-to-day operational issues, which would be attended by expert help desk staff. You are charged for full-service support totaling approximately $22,500 which covers desktops, servers, network devices, firewall and network printer.

Pricing  
Self-managed  
T&M IT Support
T-Care
 
Annual
One-time
Annual
One-time
Annual
One-time
IT Staff   
$45,000
$0
$0
$0
$0
$0
Staff Benefits   
$12,975 
$0
$0
$0
$0
$0
IT  Management System 
$0
$10,000
$0
$0
$0
$0
Staff Training 
$2,500
$0
$0
$0
$0
$0
Managed Services cost
$0
$0
$30,600 
$0
$0
$0
Total with Supervisor 
  $60,475 
$10,000
$30,600
$0
$22,500
$0
       
Soft ROI factors
Self-managed  
T&M IT Support
T-Care
Average time to response
Immediate-  
2-4 hours depending on time to travel to site
Immediate through NOC
Percentage of IT problems addressed
100% All problems are attended to by the in-house team
40% End users try to fix some issues by referring to their colleagues to avoid the cost of calling for IT help. They sometimes live with the problem till the next visit of the IT support engineer
100% Using a toll free number end users report a problem. With remote control techniques, TTJ resolves 93% of issues instantly.

Productivity loss per year

Per employee (hours)
Total (hours)
Estimated Dollar Cost


25 Hours
1000 hours
$35,000
50 hours
2000 hours
$70,000
10 hours
400 hours
$14,000
Type of Support
Reactive for 8 hours
Reactive to down situations
Proactive monitoring on 24x7 basis , toll free number for help desk
     
Managed by:
Advantages
Disadvantages
T-Care
Proactive management of IT infrastructure
24x7 monitoring by group experts
Remote Management reduces mean time to repair
Comprehensive management related to Desktops, Servers, Networks and E-mail protection
Reporting portal-access to wealth of information related to inventory, availability and performance
Enterprise Class IT management platform using industry best practices
Predictable monthly billing
SLA based
Dependency on third party
Slightly higher cost than some alternative options
Most work performed off-site so customer does not see the tech/engineer
Time and Material IT Support
Classical Model
Friendly vendors
Eliminates headache of hiring staff, training and system maintenance
Reactive management
No 24x7 monitoring
Pay as you use (unpredictable bills)
Billing on systems “Down”
Lack of expert group support
Delay in attending to problems due to physical travel to site
Dependency on third party

Self Managed


Complete control of the IT management process
Choice of management tools
IT management not core business activity
Retaining IT experts may be difficult
High cost of training manpower

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