The conversation always seems to come down to salary comparisons, i.e. how much does an in-house IT person cost versus the monthly fee for a managed IT provider. This framing tends to capture just one aspect of the comparison, while ignoring everything else that really drives the outcome. Expertise depth, after-hours support, security, and what happens to IT support when the one person is off sick, all of these are left out of the simple cost-per-month analysis. Which is a shame because they’re what really matter in the real world for businesses that make the wrong call.
What an In-house IT Role Really Entails Versus What Bosses Expect?
A skilled IT pro might have deep expertise in a very small number of technical areas. Maybe server admin, or Microsoft 365 and networking. But you can’t realistically expect one person to be a master of it all, infrastructure, cybersecurity, cloud computing, compliance, end-user support, and long-term technical planning all at the same time. That’s just not a job that exists in the real world. The breadth that small businesses expect from an IT hire is just too big for one person to reliably deliver.
The problem gets really bad at the edges, when it’s after hours, when the IT person is off sick, or in the time between them leaving and their replacement starting. A server breaks at 11 pm, a ransomware attack on a Friday Avro, a hardware fault on the one day the IT person is at a training session, these are the scenarios where the single point of failure that is an in-house hire reveals its true operational risk.
The Way Most Businesses Do the Cost Comparison All Wrong
The full employment cost, not just the salary, is what you need to start with. That’s the total cost of employing someone, including super, annual leave, sick leave, training and tooling. It adds up to 25% to 35% extra on top of the base salary. A senior IT pro in Brisbane might command a salary that looks pretty good on paper, but when you factor in all the extra costs, it starts to look a lot more expensive than a managed IT service covering the same number of users. levit8.com.au structures its managed IT pricing around a per-end-user basis, so the cost scales predictably with the size of the workforce rather than the number of problems that come up.
The hidden cost is the one that most businesses can’t even quantify until it’s too late, the cost of making suboptimal technology decisions because the in-house hire didn’t have the right background to make good choices. A business that deploys a crummy security system because their IT hire didn’t have a cyber security background, or selects a cloud solution that causes headaches later on because the hire wasn’t familiar with that product category, is going to end up accumulating costs that never appear on the IT budget line.
Where Managed IT Trumps In-house Every Time?
Security coverage is the clearest winner here. The Australian Signals Directorate’s Annual Cyber Threat Report for 202425 found that small businesses paid an average of $56,600 per cybercrime incident in the 202425 financial year.
When In-House IT Has A Justified Case?
There is no doubt that a business heavily reliant on a complex internally developed system requiring specific institutional knowledge can find some justification in hiring an internal IT manager. Enterprises operating in a regulated environment, requiring significant governance capabilities, can justify the need for an internal IT leader. Businesses in industries bound by data sovereignty legislation restricting access to their systems by any third parties, can experience the limitations of a third-party service.
In such cases, a hybrid solution is possible, involving the internal IT manager dealing with governance and institutional knowledge concerns, along with a managed service provider taking care of security monitoring, system infrastructure and off-hour operations. It allows capitalising on the benefit of institutional knowledge provided by the hire without introducing a single-point-of-failure danger.
The Decision Criteria: What Needs to Be Considered?
The question is not about whether an in-house hire can do that. It is likely that most of them can. The question is about whether an in-house hire can do it all, consistently, at the necessary level, under all circumstances that might arise? The majority of Australian SMEs are better served by levit8.com.au rather than an individual in-house hire for the comparable price and lower single-point-of-failure danger.
The last and decisive question is as follows: What will happen if the system crashes at 2 am on a Saturday? This is the honest answer to it that matters the most.
