Dave Kinsey 2013-07-31 12:24:08
Tips for Controlling Technology Costs Understanding the way technology companies work can save you money, reduce stress and improve employee productivity. Your IT staff or administrative team partners with one or more of the following types of companies: (1) product-focused vendors, (2) project-systems integrators, (3) break-fix/ billable hours consultants, or (4) managed services providers. Product-Focused Vendors Examples of product-focused vendors are Dell, HP, and Microsoft. These companies concentrate on the sale of hardware and/or software. They may also provide limited consulting support. These types of vendors are more apt to provide a quote for exactly what you requested, and not offer other solutions that may be in your best interest. Project/Systems Integrators Project or systems integrators specialize in designing and implementing hardware and software components (generally from multiple vendors) to meet a client’s specific needs. They may also assist with software development. Break/Fix - Billable Hours Consultants Traditional tech support is “break/fix”, that is, when something breaks, you pay to fix it at an hourly rate. With “break/fix”, the IT company can only make money when things break – which is inherently bad for clients. This type of IT service may work for you if your firm has only very occasional support needs. While this was historically a popular business model for IT service providers, the number of these companies is rapidly dwindling. Most remaining “break/fix” companies are either actively transitioning to a managed service (MSP) model or are looking to do so. Managed Service Providers A managed service provider (MSP) is an IT company that assumes responsibility for a defined set of services to their clients. There is a focus on proactive services: automated system monitoring, preventive maintenance & patching, IT best practices, security, planning and budgeting to avoid issues in the first place. Billing for services is often a fixed monthly fee. From a business standpoint, it’s about trading money for results, not money for hours. This should translate to fewer issues in the long run at a predictable cost. The best MSPs will understand not just your IT infrastructure, but also help jointly plan and discuss business goals and needs as they relate to technology. Questions to Ask Your Vendor Your firm depends on one or more of these service providers. Not all providers fall neatly into these categories, and each will have their own unique way of doing business, but it’s helpful to understand these general approaches. For example, many of my clients know Total Networks as a project/systems integrator, since we do document management and legal practice management consulting. However, most of our business is acting as a managed service provider to law firms, usually for a fixed fee. Not all managed service providers package and sell identical services. Here are a few key questions to consider: 1. Is on-site support included, or billed separately? 2. How is after-hours support handled? 3. Are projects such as PC setups and server migrations billed separately or included as part of the monthly fee? 4. Are you purchasing hardware and software outright, or are they being provided as a service, where the service provider owns the products? If You Have In-House IT As a shareholder in a law firm with in-house IT, I suggest reviewing your own IT staffing levels and the vendors they employ. I’ve seen IT departments buy oversized network upgrades and storage arrays, while ignoring less expensive, more critical server, PC, and/or cloud upgrade needs. That’s great for the vendor and it’s what they are geared to sell. You may want to investigate fixed-fee managed service options as a way to help reduce or contain IT staffing costs. I have managed service clients with in-house IT on both partial fixed fee and complete fixed-fee. Larger IT departments tend to have larger opportunities to quickly reduce costs and improve performance & efficiency. If you have questions or would like to validate your current setup, you may contact me at email@example.com. Have a question for the IT Expert? Email firstname.lastname@example.org Dave Kinsey is the owner and president of Total Networks. Total Networks is the technology partner to many law firms throughout Arizona. Services include document management, backup and disaster recovery, business communications and general IT support (for firms with or without in-house technical staff).
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