As with any vendor selection process, pricing matters. The same holds true for the IT services industry. Let’s say you’ve done your due diligence and identified a few help desk providers. All offer a 100% US Based, 24 x 7 x 365 solution and they’re all accountable for meeting SLAs like First Contact Resolution and end-user satisfaction ratings. All things quality being equal, the key differentiator ends up being on the bottom line and what services are included in that price. So when evaluating help desk support companies or MSPs, it’s important to choose a pricing model that most aligns with your business use case. Below are some options to consider which will help you determine the best fit for your organization.
Per interaction (i.e. per call/per contact/per minute):
No matter how attractive the per-minute fee may be (and with an off-shore provider, it can be very attractive – on paper), any usage-based pricing model creates a very rational fear of the unknown; in this case, the monthly invoice. Any pricing model that assesses service fees like a utility works well when the IT environment is stable. Likewise when technical support staff delivers a swift resolution of technical issues via efficient and knowledgeable staff. On the other hand, if the help desk outsourcing vendor staffs poorly trained help desk agents that require additional time to research the resolution procedure or need to transfer the call (i.e. escalate the issue) to a higher skill set, the final cost per resolution may be much higher than anticipated.
Prospective clients should also consider the inherent conflict of interest in any pricing model that generates revenue for the MSP the longer technical issues remain unresolved or the more frequently they recur. If the MSP is generating more revenue the longer their agent is on the phone, (like putting the end-user on hold instead of calling them back), there really is no incentive for them to resolve the issue quickly. For the same reason, this model disincentivizes the MSP to hire skilled agents. In fact, they are more prone to hire novice agents who follow generic scripts peppered with small talk while the meter is running. When the adage “time is money” literally impacts how the invoice is calculated, the best recourse with this model is to keep MSPs honest with SLAs such as First Contact Resolution rates.
Per incident/per ticket:
Potential clients generally consider this model fair, because MSPs assess fees one time per each technical support issue or incident regardless of how many contacts it may take to resolve that issue. This is the preferred model for larger companies that have their own IT departments and merely want to outsource help desk functions. In this case, the MSP serves as the first point of contact with a heavy emphasis on Level 1 incidents. Unlike with pricing models that assess fees with every interaction, the per-incident model somewhat incentivizes the vendor to keep its costs low and resolve the issue in the first contact, because subsequent contacts for that issue, at least at Level 1, are no longer billable. Still, as with any usage-based pricing model, there remains a lack of predictability with the monthly invoice.
Per device/per user:
This model works well for organizations that want predictable monthly costs. It’s even more favorable when the support is all-inclusive versus for Level 1 access and connectivity issues only. If the MSP handles everything on the desktop including AV, patch management, and on-site troubleshooting for desktop and network devices, this is the ideal solution for small companies with no IT staff. In this model, the only cost fluctuation is driven by headcount or device count in which case the invoice is adjusted accordingly at the established flat rate.
Flat fee versus usage (pay as you go):
The double-edged sword with usage-based or pay-as-you-go pricing models is that invoices fluctuate with the peaks and valleys in support volume. When the IT environment is stable, clients will see a parallel reduction in the monthly invoice. And by contrast, company-wide IT changes such as new software rollouts can provoke a spike in monthly ticket volume with the invoice reflecting the increase in billable incidents. CFOs prefer the flat fee model whether it’s per-user or per-device because there is no guesswork or additional approval requirement triggered by the monthly invoice.
On the other hand, a CIO may see less value in a flat per-user fee if that user is technically savvy and rarely needs to call the help desk. However, this thinking typically applies to reactive tasks or incident management issues. When considering the ROI of a robust help desk solution, most people don’t think in terms of proactive tasks that need to be managed by the MSP on the back end such as running AV updates, patches, or providing IT services that prevent technical issues from arising in the first place. Since there is immeasurable value in any proactive tasks that reinforce end-user uptime, even low maintenance employees will benefit. As with any technically diverse end-user population, there will be collective value in having a responsive help desk team that’s there when you need them.
Level 1 versus all-inclusive:
Do you want them to handle everything IT or merely help desk tasks at their most basic? Much of the choice depends on whether or not you have an internal IT staff or tech-savvy individuals addressing those needs as they arise. Larger organizations (500+ employees) tend to have their own internal IT staff. In this case, they typically prefer the outsourced MSP to handle a specific tier or level of support that it’s the least financially viable to own. For example, organizations that have internal network engineers or desktop technicians don’t see value in them handling low level (Level 1/Tier 1) support tasks such as access and connectivity issues.
Not only is it costlier to have higher compensated people troubleshooting basic technical issues, but this contributes to high turnover when the staff doesn’t feel challenged or the majority of their day isn’t aligned with their skill set. Even if such staff doesn’t quit due to burnout, working in constant interrupt mode deters their focus on more crucial, company impacting projects and timelines. So, understandably, outsourcing Level 1 help desk functions are ideal in this scenario. By contrast, small organizations might benefit more from an all-inclusive solution with the MSP handling Remote Monitoring and Management (RMM) of the devices to proactively guard against viruses and install patches or software updates as well as dispatch on-site support technicians to the user’s desktop when an on-site presence is needed.
At the end of the day, there are a number of other qualifying factors to consider when determining the perfect fit. But understanding the budgetary ramifications of each MSP’s help desk outsourcing pricing model can save time in the evaluation process. For more information, feel free to contact us at 312-283-3677.