Outsourcing

Hiring vs. Outsourcing IT: Find the Right Balance for Your Business

The phone rings: Your sales team just closed a big deal. It’s the kind of contract that could fuel your next stage of growth.

But there’s a problem. To fulfill it, your company must meet strict data security protocols and provide 24/7 support coverage. These are things your IT function just isn’t built for.

Your choices: hire, outsource, or risk the deal falling through.

You could be one phone call away from this dilemma. As your business grows, so do your technology demands. Where once a one-person IT generalist or ad hoc support were enough, that approach no longer supports the pace, complexity, or risk profile of your company.

Many businesses at this stage face a pivotal decision: Should you build an in-house IT team, outsource to a managed service provider (MSP), or blend both for optimal impact?

There’s no one-size-fits-all approach. But the right balance between internal hiring and outsourcing can unlock business agility, resilience, and long-term ROI.

What Businesses Need From IT Today

Technology doesn’t just support your infrastructure. It’s a strategic lever for scaling operations and staying competitive. Small and midsize businesses (SMBs) need IT to deliver:

Daily operational reliability. Every business needs access to systems, apps, and IT expertise (whether internal or external) to keep running and make informed IT decisions. That includes uninterrupted access to critical software, databases, and cloud services to maintain productivity and serve customers. And even an hour of downtime leads to lost revenue and productivity, service interruptions, and damage to your brand’s reputation, so internal IT support for employees and systems is vital. Business leaders address this need by having IT experts available, either in-house or through managed services, to ensure that technical issues are addressed promptly, reducing business risk.

Scalability and flexibility. Your IT systems need to support expansion, like adding users, storage, or processing power. This is essential for supporting business growth, like new product launches or expansion into new markets. Your business must also be able to adjust to seasonal spikes (like holiday sales) to ensure a consistent customer experience and operational continuity.

Security, compliance, and risk management. These are essential functions for protecting assets, maintaining trust, and ensuring business continuity. For SMBs, good security measures are an ongoing practice, and a valuable investment. Especially considering that the financial repercussions of a cyberattack range from $120,000 to $1.24 million USD per episode. Companies can also bolster security, safeguard sensitive data, and avoid legal fines with governance, risk, and compliance (GRC) practices and solutions. Other helpful risk management services include identity and access management, vulnerability management, and data backup/disaster recovery.

Strategic IT planning. Creating a roadmap that aligns tech investments with business priorities is the best way to move forward. With planning and coordination, you can help ensure that your tech investments directly support business objectives while preventing wasted resources and misaligned projects. Companies that don’t have IT executives on staff can get access to expertise through IT consulting services, such as virtual CIOs (vCIOs).

Knowing all this, how do you decide when to hire versus when to outsource an IT function? Weighing the pros and cons can help you design an IT approach that balances deep expertise, strategic alignment, and cost efficiency.

The Case for Internal Hiring

As organizations consider how to structure their IT operations, building an internal team offer several strategic benefits, including:

Deep understanding of company culture, workflows, and systems. Internal teams are deeply familiar with your values, communication styles, and team dynamics. They’ve had time to build relationships and trust with their fellow employees and , along with an understanding of your IT environment.

On-site presence for immediate troubleshooting and collaboration. Internal resources can rapidly provide hands-on assistance with technical issues. They work side by side with other teams to implement systems and resolve issues. The relationships and shared experiences they share with these colleagues can make problem-solving more efficient.

Direct control over task prioritization and project execution. This control enables businesses to align IT efforts closely with strategic goals, as long as business leaders in the organization are also involved in the decision-making process. Internal teams can respond quickly to changing needs and ensure smooth project delivery. As part of your organization, internal IT resources can also quickly discuss, approve, and implement changes or new initiatives.

Challenges include:

High costs. IT managers, systems administrators, and cybersecurity professionals command competitive salaries, often reaching six figures for senior positions, as a Glassdoor search can show. Finding qualified IT talent involves recruiting expenses, including advertising, interviewing, and background checks. Technology evolves rapidly, requiring IT staff to engage in continuous learning to stay current with new tools, cybersecurity threats, and compliance standards. Training programs, tech conferences, and certifications can cost thousands of dollars per employee annually.

Limited coverage for specialized or advanced capabilities. Small internal teams tend to be staffed with generalists, which can mean they lack expertise in advanced cybersecurity, cloud architecture, data analytics, AI, or compliance with complex regulations. These teams are usually fully engaged with daily support tasks, leaving little time for advanced training or exposure to the latest industry trends, tools, and best practices.

Risk of turnover or burnout within a small team. When small teams run IT for an entire company, the strain of their workload can cause burnout. When employees leave, their departure requires knowledge transfer to a new person, for whom you’ll have to repeat employment and training costs. It can be tough and time-consuming to replace them, especially if they had specialized knowledge, and their absence can create vulnerabilities in IT operations.

The Case for Partnering with an MSP

Working with an MSP is a flexible, cost-effective way to augment or replace the need for a larger in-house team.

Advantages:

Access to a wide range of IT expertise without the need to hire specialists. MSPs employ teams of experts in cybersecurity, cloud computing, networking, compliance, and data management. This expertise is available for a predictable monthly or per-project cost. Working across multiple clients and industries, these pros stay current with the latest technologies, industry trends, and security threats.

Built-in redundancy, business continuity, and coverage during absences. MSPs design IT environments with redundancy in mind, implementing backup systems, failover servers, and replicated data storage to help ensure uninterrupted operations and minimize the risk of data loss. By setting up multiple network connections and providing proactive monitoring, MSPs can help safeguard against outages or maintenance issues. They’re well-versed in creating business continuity and disaster recovery solutions, including regular backups, incident detection, and rapid response protocols. Their roster of IT pros means support is available even when individual staff members are on leave, sick, or on vacation.

Flexible service models that scale with your needs. MSPs can quickly allocate additional resources or expertise to cover for unexpected absences, to keep IT operations smooth and secure. You choose the level of IT support and services that best fit your current business goals. As your company’s needs evolve, you can adjust without the cost and delay of hiring or restructuring internal teams.

Establish clear communication and defined roles for integration with internal stakeholders. This is important for productive collaboration, clear accountability, and high quality of service. Best practices include:

Setting up designated communication channels. To make sure all requests and communications are received, use designated platforms (like ticketing systems and other collaboration tools). Assign a primary point of contact to streamline queries and updates.
Communicating results. If your MSP doesn’t offer, ask for regular reports and statistics on project and service performance. This way you can both confirm that service level agreements (SLAs) are being met.
Scheduling regular check-ins. Hold weekly, monthly, or per-project-phase meetings to discuss needs, review progress, and address concerns.
Documenting roles and responsibilities. Explicitly define which tasks are handled by the MSP versus your internal IT team—such as user support, cybersecurity, or project management.
Clarifying a hierarchical structure. Outline escalation procedures and decision-making authority so everyone knows who is responsible for what and when. This helps ensure that everyone has the right access and permissions to access the necessary systems.
Assigning internal stakeholders. Designate internal contacts who will work directly with MSP account managers or project leads, to help ensure accountability and ownership on both sides.

Address the perception that external IT pros may be less aligned with company culture. It’s common for people to have concerns when outsourcing services, as they’ll have less face-to-face interaction with MSPs than with internal teams. This can lead to a feeling of less ownership. By fostering a culture of feedback, communication, and clarity of roles and project performance as outlined above, you can get the most out of your engagement with an MSP. Keep employees and stakeholders informed about the decision to use an MSP, how that engagement is structured (such as SLAs and roles), and what the MSP will be available to help them with.

Conclusion: IT That Fits the Business, Not the Other Way Around

Internal hiring gives you control and continuity. Outsourcing gives you depth and agility. Blending both allows you to focus internal resources on business-critical strategy while leveraging MSP partnerships for scale, support, and specialized expertise.

At ISOutsource, we partner with SMBs to find the right mix. Our tailored, scalable IT services integrate seamlessly with your goals, helping you optimize costs, reduce risk, and position technology as a growth engine—not just a maintenance function.