IT Outsourcing Part 2 – The Break-Fix Model
In part one of my series of IT support options for small business I talked about Sole Proprietors and some of their positives and negatives for supporting your business. In this article I will talk about the break-fix model of IT Support. Future articles will detail the managed services model as well as bringing your support in-house.
Who the break-fixers are:
I define break-fix (BF) as a consultancy with a couple of technicians or perhaps more that primarily focus on waiting for customers to call them when things are broken in addition to project work. While many SP consultancies also operate in this model (much like I did) I am making the distinction between the two that BF consultancies have more than one tech. The addition of a second tech really helps the scale issues I mentioned in my previous post.
Normally, the break fix shop has a sales person or two in addition to the techs which allows the techs to keep focused on the customer support and projects while the sales team works on generating leads. The techs are responsible for billing time, proposing new projects for existing clients, and helping the sales team with proposals.
Why they’re a good fit
Break fix shops are a good fit for small-mid sized customers. Many of the scale issues I mentioned as a downside for the Sole Proprietors go away as just having two or three techs allows several problems to be fixed at once. An additional benefit of having multiple techs is that they are able to specialize in certain aspects of technology which allows them to provide better technical services to their clients without requiring everybody to be an expert on everything. This makes it much more likely that they can handle more complicated networks, larger user bases, and frankly a much larger customer base.
This model is especially beneficial to clients that don’t mind occasional expenses (sometimes major depending on the size of outage or project) but don’t want a fixed monthly cost. There are many times when having a fixed monthly cost makes more sense, but I ran into many clients and prospects in my time that a fixed cost wouldn’t work for them for one reason or another.
Why they’re perhaps not a good fit
This method is much more of a firefighter type of way to work your IT – waiting for bad stuff to happen and then your IT provider comes in to put the fire out. It’s harder to be pro-active in this environment as between projects and fire fighting there isn’t much time to do the proactive steps that really should be done. I also found that it was harder to justify pro-active steps to a customer when bills got questioned. I’m good at putting out fires, but I’d much rather spend my time making sure that the fires didn’t happen in the first place. Unfortunately, billing a customer for reviewing logs and checking the health of their network, servers, and workstations doesn’t always go over well. The thing that goes over worse is the fact that putting out fires is also normally expensive – more expensive than being proactive by a long shot. Good customers understand this when it’s explained to them, but there are many that simply don’t until they get bit by an outage and get a couple thousand dollar bill.
The whole billable time thing is the other issue. Outages generate lots of billable time, spyware creates a lot of billable time, and projects create a lot of billable time. Lots of billable time leads to large bills and those bills to customers generate issues. In addition, techs are praised and in many instances get bigger bonuses when they bill more. This method is very similar to law firms or other professional services firms where the associates are all trying to generate more time to bill.
In the IT industry constant long hours can easily lead to burnout. When techs try to squeeze in as much billable time in a given month to bump their bonuses burnout creates itself. When I was having a good month I might work an extra 10 or 15 hours per week in the evenings or weekends which grew old. The problem is that once you get used to doing this it’s hard to stop because your clients come to expect it. When techs grind out 50-60 hour weeks and are consistently billing 30-40 hours per week they tend to get tired of it. Burnout leads to turnover. If they’re not part of the ownership or have no potential to earn their way into ownership you can only grind for so long. I can and am willing to grind out as much billable time as possible but not if my name is never going to be on the door, and frankly that’s precisely why I’m not working at a BF shop any longer. I billed a lot of time, and could have easily done more if there was a light at the end of the tunnel. My personal rant aside, I really grew my skills in this model so it wasn’t all bad.
My Recommendation
My recommendation is this: In a perfect world, your IT support would be more pro-active than reactive. If you can work this model with either Sole Proprietor or a larger shop and be pro-active more power to you. The best fit for this model is if you have just a handful of users as it’s conceivable that you could go a month or two without any IT expense. Just make sure you have someone internally monitoring your backups. Honestly though, if you have more than 10-15 users you should look for a fully managed solution, you’ll have less downtime which will lead to more productive workers.