The Cost of an Internal IT Department

Posted: December 5, 2023

ROI—return on investment—is an important metric to measure for every aspect of your business. This includes the costs that maintaining your business technology accrues beyond the cost of acquisition and ownership. Let’s examine the average cost of an internal IT department.

How Can You Calculate the Cost of Your IT Department?

Let’s assume that, for the sake of our example, you have one or two employees charged with maintaining your company’s IT. The first aspect you need to consider as you total up your IT department’s costs is the payroll that is spent on time committed to your business’ IT directly.

For instance, if you have two employees who each earn a salary of $65,000 per year and spend three-quarters of their time directly managing your business’ IT, you’re indirectly committing $97,500 to IT. With a dedicated team, you can count 100 percent of their compensation as IT costs. Be sure to take benefits and everything else into consideration, too.

Of course, the costs don’t stop here. In order to properly do their jobs, your IT staff members will need to continue their education to pick up on new best practices, technologies and techniques. Ongoing professional development needs to factor into your cost analysis, as should any travel your team partakes in or conference registration.

There are also the costs associated with maintaining various compliance standards, depending on your industry or security requirements, that need to be factored in as well.

All in all, this boosts the $97.5k payroll investment significantly… and that’s before you even take the other IT costs into account. You also have to supply your staff with the requisite equipment—computers and mobile devices—while also maintaining them. Any cloud subscriptions and software licenses are also considered IT costs and need to be factored in.

This is a lot to juggle, especially for a small or medium-sized business.

Consider Co-Managed IT

Co-managed IT, also known as co-managed IT services, refers to a collaborative approach where an organization works with an external IT service provider to manage and support certain aspects of its IT infrastructure. Here's a list of some of the key advantages of co-managed IT:

With a comprehensive collection of IT services and management provided in exchange for a predetermined monthly service charge, we’re able to make your business’ IT that much more effective. We work with our clients to provide a completely customized co-managed solution. Reach out to us to learn more.

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