Brief: Your IT team isn’t just about keeping systems running—it’s a strategic investment that impacts security, productivity, and growth. The question isn’t whether you need IT support—it’s whether you should build an internal team, outsource to a Managed IT Service Provider (MSP), or take a hybrid approach.
“The single most important decision in business is who you hire.” — Elon Musk
Each option has its advantages and costs. Internal IT talent provides deep business knowledge but comes with recruitment, salary, and infrastructure expenses. MSPs offer on-demand expertise, proactive security, and scalable support at a predictable cost. A hybrid model balances both.
The right choice depends on your business size, industry, and long-term goals. This guide breaks down the costs, benefits, and ROI of managed IT services versus in-house IT teams—helping you make the best decision for your business.
Weighing Your Options: Managed IT Services vs. In-House IT
Every business has unique technology needs. Here’s how each approach compares:
Managed IT Services: Scalable Expertise Without Overhead
An MSP acts as an extension of your business, delivering expertise and enterprise-grade IT solutions at a fraction of the cost of an internal team.
Key Benefits:
- On-Demand IT Support – 24/7 access to expert troubleshooting and monitoring
- Security & Compliance – Proactive threat detection and regulatory alignment
- Scalability – Pay only for what you need, scaling services up or down as your business grows
- Predictable Costs – Fixed monthly pricing avoids surprise expenses
Instead of hiring multiple IT specialists, an MSP gives you access to a team of professionals across cybersecurity, networking, cloud, and strategic IT planning—all for a fraction of the cost of an internal team.
“The biggest advantage of managed IT services is access to top-tier expertise—without the overhead of full-time employees.”
Internal IT Team: Full Control, Higher Costs
Building an internal IT team ensures a dedicated focus on your company’s technology strategy. However, it requires significant investment in salaries, training, infrastructure, and ongoing maintenance.
Key Considerations:
❌ Higher Fixed Costs – Hiring, salaries, benefits, and infrastructure investments add up
❌ Limited Availability – Internal IT teams aren’t available 24/7 unless staffed around the clock
❌ Knowledge Gaps – A small team may lack expertise in specialised areas like cybersecurity and compliance
✅ Deep Business Knowledge – Internal teams understand company processes, culture, and long-term goals
For businesses where IT is core to the product or service (e.g., SaaS, fintech, or manufacturing automation), hiring an internal IT team can be essential. But for most mid-sized businesses, the cost of building and maintaining an internal IT department outweighs the benefits.
The Hybrid Approach: Best of Both Worlds
Many businesses opt for a mix of internal IT staff and managed IT services. For example:
- CTO-led IT Strategy: Internal leadership oversees IT procurement, strategy, and vendor management
- MSP for Day-to-Day IT: Managed IT services handle cybersecurity, cloud management, and troubleshooting
- In-House IT for Core Functions: IT staff focuses on industry-specific technology needs
This approach gives businesses flexibility, ensuring mission-critical IT functions remain in-house while leveraging an MSP for scalability and security.
The ROI of Managed IT Services: Breaking Down the Costs
When evaluating IT investment, total cost of ownership (TCO) matters. Here’s a breakdown of IT costs across different business sizes, based on current Canadian salary data and MSP pricing:
Salaries for Internal IT Roles in Canada
- IT Manager: $95,000 – $120,000 per year
- System Administrator: $75,000 – $95,000 per year
- Cybersecurity Analyst: $85,000 – $110,000 per year
- Helpdesk Support: $55,000 – $75,000 per year
- CTO (If applicable): $150,000 – $200,000+ per year
Hiring a small IT team of three to five employees can cost anywhere from $250,000 to $450,000 per year, excluding benefits, training, and infrastructure costs.
Comparing MSP Costs vs. Internal IT
| Business Size | Internal IT Cost | MSP Cost | Annual Savings & Benefits |
|---|---|---|---|
| Small Business (Under 20 employees) |
$90,000/year (1 IT Manager + part-time support) |
$2,500/month | $60,000 saved annually, plus proactive IT support, help desk |
| Growing Business (20-50 employees) |
$250,000/year (3 IT employees) |
$7,500/month | $100,000 saved annually, plus enterprise-level security |
| Mid-Sized Business (50-100 employees) |
$450,000/year (Full IT team) |
$12,000/month | $150,000 saved annually, plus reduced downtime & IT risk |
Key Takeaways from the Cost Analysis:
- Hiring an internal IT team is expensive, requiring salaries, benefits, training, and infrastructure investment.
- Managed IT services offer enterprise-grade expertise at a fraction of the cost.
- Unplanned downtime costs businesses an average of $5,600 per minute, making proactive IT management critical.
For businesses without dedicated IT budgets, an MSP provides predictable monthly costs while reducing the risk of expensive disruptions.
Which IT Model Delivers the Best ROI?
The right IT strategy depends on your business size, budget, and growth trajectory.
✅ Choose Internal IT If:
- IT is core to your product/service (e.g., software development, fintech)
- You require deep, industry-specific expertise in-house
- You have a budget to build and maintain an IT department
✅ Choose an MSP If:
- You need scalable IT support without hiring full-time staff
- Cybersecurity and compliance are priorities
- You want predictable costs and reduced IT risk
✅ Choose a Hybrid Model If:
- You have IT leadership in-house but need additional technical support
- You want to balance internal knowledge with MSP scalability
- You need 24/7 coverage without hiring multiple shifts
Regardless of your choice, technology should be an enabler, not a bottleneck. If IT issues are slowing your business down instead of driving it forward, it’s time to rethink your approach.
At F12, we provide tailored managed IT solutions that align with your business strategy—whether you need full IT outsourcing, co-managed services, or a flexible hybrid model.
Let’s talk about how managed IT services can help your business scale efficiently. Get started with a free IT assessment.
