In an increasingly aggressive corporate environment where boosting revenues, minimizing expenses, and streamlining processes are critical, organizations are usually faced with an important question — is it better to hire manage a contingent workforce on your own or seek help from a managed service provider, or MSP?
Let’s explore some aspects of having an in-house team versus partnering with an MSP.
The Case for In-house
In-house staffing does offer some exclusive benefits. Most notably, an in-house program can respond to issues quickly and being on site enables them to implement solutions more systematically and urgently.
Additionally, having an in-house team gives organizations absolute control over their staffing and other critical HR-related issues.
On the other hand, it can get quite expensive. Recruiting and training staff takes time, effort and money. Losing even one of your in-house members means that you must reinvest in new hires.
Further, in-house teams themselves will need management, which translates to even higher overheads.
Then there’s cost, given that organizations end up paying salaries even when there is no work to do, especially during quiet times. On top of salaries, organizations bear the burden of other employee costs in terms of PTO and benefits — not to mention performance management, disciplinary issues and managing through sudden employee emergencies.
The downsides of the in-house staffing approach make it infeasible for many small and midsize organizations unless they have very explicit requirements. Some may argue that it may be reasonable to employ a few employees, but will have the capacity to handle an abrupt influx of time-sensitive tasks?
Fortunately, that is where MSPs can help.
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The Case for the MSP
What are the advantages of partnering with an MSP?
Predictable cost. An in-house team comes with frequent and unexpected costs that might quickly drain your budget, especially if you are a new start-up.
Are you able to cover in-house staff absence with contractors on short notice? Are you in a position to partner with an MSP to fill the gaps that arise in your in-house team’s knowledge? What happens when a crucial member of your team finds a better role elsewhere?
Unpredictability in staffing usually leads to unpredictable costs. In contrast, a managed service provider will offer what they signed up to provide without any extra costs being thrown in on a monthly basis.
A service agreement. Good MSPs appreciate that every business is unique — and on that basis — they will come up with a staffing package that precisely suits your needs. MSPs achieve this by crafting a service level agreement (SLA) as a foundation for your working relationship. Usually, this document works as a bond or contract — detailing how much your package or plan will cost — and what you will get as a result.
For organizations that offer essential services, this kind of agreement cannot be emphasized enough. For instance, in IT companies or departments, downtime is a serious issue — thus, ensuring you have 100% uptime can save you from complaints and costly lawsuits from your clients.
When it comes to staffing-related support, your MSP will be obligated by their SLA to resolve issues quickly or within the specified deadline.
Subject-matter and market experience. Because they work on a wide range of projects, MSPs have a broader knowledge of issues and ever-changing business best practices.
An in-house employee’s experience may stop growing as, after signing your employment contract, they only work for you, and their concentration is wholly directed to your company operations. To keep in-house staff updated requires costly training. And it’s not always logical to have an in-house employee learn a new skillset for a one-time project. An MSP provides access to a team of specialists and experts with skills that matches your exact needs.
The Blended Approach
The in-house vs. MSP debate can be tough to solve. But it should be understood that these two staffing approaches are not mutually exclusive.
Having an in-house team doesn’t mean it is not practical to work with an MSP as well. There are countless situations where complementing and supplementing your in-house team with an MSP can work significantly to your advantage. An MSP can basically plug the gaps to give your in-house employees time to focus on core strategic projects.