“Pay-as-you-go,” “Cash Basis,” “Block Hours,” or as the industry calls it, “Break/Fix,” are all the same idea. Something in the IT realm breaks, you create a ticket with your IT Company, and they fix it. Then, the hours used to fix the issue is charged to you, either in a pay-as-you-go model or charged to a bank of block hours.
Who this is best for:
Break/Fix hours are best for companies that have internal IT knowledge that supports the size of their company. In this model, the business is the leader in the IT relationship. They are making the choices for the company and utilizing the IT Support as a resource in these choices. This works well with companies under 10 employees, in non-regulated industries. In regulated industries, such as healthcare, financial institutions, etc., the need for compliance knowledge usually creates a higher demand for IT knowledge that a small company of that size can afford. Their choices are to pay for consultants to go alongside their Break/Fix, or to convert to a Managed Service Provider.
How much this will typically cost:
Typically, Break/Fix charges will amount to anywhere between $95-$175 per hour. This varies by business depth (the variety of resources they have), and skill level of the technician doing the work. It is usually billed in 15-minute increments for remote work and 1-hour increments for onsite work. The client has control over when they call and use the hours, but they do not have control over how much time is used.
How to choose a Break/Fix Company:
A more mature Break/Fix IT support will be transparent with how many hours they estimate a project or issue will take, before working on the issue. For example, they may say, everything under 2 hours we will resolve and bill out, but everything over 2 hours will estimate for you prior to working.
So, ask them about what their life cycle of an issue looks like.
- Is there a ticketing system, so that issues do not get forgotten?
- What is the triage process for the tickets?
- How are tickets prioritized?
How billing issues are handled:
Mature Break/Fix companies will rarely discount invoices because the client questions how many hours it took something to fix. They will have a review process that will deem its validity internally, prior to invoicing.
KPIs to request:
Average Time to Resolution, Average Time to Response
“Flat fee,” “All-you-can-eat,” or “Outsource IT” are all terms used to describe the Managed Service model. For one monthly flat fee, the IT support will take care of all maintenance and day-to-day support of your network. Most Managed Service Providers exclude project work such as new offices, network upgrades, major hardware upgrades, etc. To be able to include client requested projects, the monthly fee would have to be large enough to support a fluctuation in work. Typically, these contracts will run $100 per user or device to support the variety of work done.
Managed Service is incentivized to diminish the disruptions in your network. If they get the same flat fee every month, the only way for them to make more money within that framework is to reduce the amount of work needed to support your infrastructure. Basically, the healthier the infrastructure, the lower amount of disruption, or issues, for the client. This equals less hours that the IT support needs to utilize.
Who this would be best for:
Managed Service is best for companies with 15-150 users. It is also great for companies in regulated industries, provided that the IT company they choose has experience in that. Managed Service providers will have a variety of staff that will bring experience and skill to support a network and end-users.
Managed Service works wonders for companies who need the IT company to take the lead in providing a healthy infrastructure, because their internal IT knowledge does not meet the demand that their company has. Managed Service aligns great when the company is needing an IT partner to aide in aligning their business goals with their IT needs.
How much does Managed Service typically cost:
Managed Service will bill per user or per device. In many industries, like manufacturing, not everyone works at a computer and therefore would fit better on a per device model. These prices can vary due to what the Managed Service Provider (MSP) is including in the price, and the infrastructure of the client. In addition, many MSPs use outsourced resources (meaning they are not internal, but a 3rd party providing support) and are able to have significantly lower prices. These MSPs may have prices as low as $50-$75 per user. Typical MSPs will be $100-$200 per user, again, depending on what they are including within the flat fee (i.e., Security, managed hardware, etc.)
How to choose an MSP:
Meet the team – A good MSP has depth to their support, and key players that offer extensive knowledge. It is hard to get that with just one or two key technicians.
Account Management – Ask who your account manager will be and ask to meet them. This person will be responsible for setting the pace for your relationship with the company. They will be your partner in IT by providing budgets, regular meetings to assess your business goals and IT alignment, and one of the points of escalation for service issues.
Reporting tools – What reporting tools do they have to provide you on your IT infrastructure performance, and how often will you receive these?
Lifecycle of a ticket – How is ticket triaged? How are the tickets prioritized (usually a form of urgency/number of users impacted, but sometimes you will find companies that give higher priority to VIP clients/users or larger paying clients).
KPIs to request:
Ticket per User or Device – This is a valuable number because you can cross reference it by industry to see if you get more disruptions than other companies like yourself. A good MSP is trying to reduce the number of disruptions for you, and therefore should be watching this number carefully.
Average Time to Resolution, Reactive tickets (sometimes called End-user tickets) vs. Proactive tickets (a good MSP should be doing a fair amount of proactive work)