Why You Should Not Resent Outsourcing Your IT

22 May 2023
Get in touch

Share on social..

Managing directors you don’t need to do everything…

Once upon a time you became the founder of a new start-up and you quickly realised that this new role means you ‘wear many hats’.

You left one job to start your dream company and have temporarily traded it for 10 more!

 

Now you must make leadership decisions, deal with customer support, be responsible for the marketing, conduct sales calls…the list goes on!

 

Even as you start to build a small team behind you, the work that goes with building a start-up company can easily become overwhelming.

And this is before you consider some of the technical issues that come with needing a solid IT function to allow you and your team to deliver the revenue generating work.

 

Our culture likes to overemphasise ‘hard work’ and we are always told that we will be successful if we are just willing to ‘hustle’ and ‘work hard’.

This advice is well intended, but have you ever considered why there are some entrepreneurs that are able to rapidly grow without hustling for 12 hours a day? While some work longer than this and never see results?

 

Hard work alone does not equal success and we need to stop pretending it does.

 

Surely, it’s more important to focus on the high value activities that earn you revenue rather than those important but lower value activities?

As a business founder and managing director, you’ve probably been focusing on the wrong activities.

 

As a business founder and managing director, your time and energy are valuable resources, and you need to make sure you’re investing them wisely. While it’s tempting to try to do everything yourself and tackle every task on your to-do list, the reality is that not all activities are created equal. Some tasks have a much greater impact on your bottom line than others, and it’s crucial to identify these high-value activities and prioritise them accordingly.

 

Roughly speaking, only a small percentage of the activities in your business contribute to 90% of your results. These activities will vary from business to business, but they generally involve making strategic decisions and conducting high value client work that move your business forward by generating more revenue.

 

By focusing on these high-value activities and delegating or outsourcing the rest, you can free up your time and energy to work on the tasks that truly matter. This approach allows you to work smarter, not harder, and achieve greater results with less effort.

 

And unless you are a ‘techy’, IT is NOT one of them…

 

Are you saving money or are you costing yourself a fortune?

 

As a managing director, you should identify and focus on the top percentage of revenue generating activities.

 

And IT is NOT one of them…

 

If you are not currently outsourcing your IT, or perhaps you do but you resent having to pay a third-party for that service, then this has been written for you!

 

Let’s face it, most of us are not tech or IT geniuses, but we also cannot deny how fundamental it is in helping us to act effectively in today’s world, particularly in business.

 

Many founders and managing directors of small-medium companies choose to ‘save money’ and stay in control of the business operations by keeping key services like their IT in house by hiring one IT manager, or by trying to solve them themselves.

You may have taken a quick look at the cost of outsourcing your crucial IT operations and decided that you can save the £1500 a month (example for this blog post) fees by trying to build an IT system or fix problems yourself.

After all, it is very crucial to keep hold of as much capital as possible, right?

 

This may give the illusion that you are saving the business money, but in reality, you are costing yourself a fortune by not investing in this crucial business operation.

 

Let me ask you a question which you may not have considered before.

 

What is an hour of your time worth?

 

There is a reason why this is being asked.

 

It’s a tricky question because how can you really measure this?

But for this exercise, let’s calculate what an hour of your work time is worth.

For the sake of this exercise, let’s say your current revenue is £1,000,000.

 

Take £1,000,000 and divide it by 2080.

 

Why 2080?

 

This is the average number of work hours in a year. This is contingent upon the average 40 hour work week in a 50-week year.

This is an example, and you can calculate your own working hours to make it more accurate for

you.

 

£1,000,000 divided by 2080 = £480.77.

 

£480.77 is your hourly rate.

 

This is essentially what you are worth to your company as your decisions drive the revenue.

 

An hour of your time as the managing director is worth £480.77 and let’s say that you spend an additional 20 hours a month on top of what you already work, either dealing with IT issues or you lose 20 hours due to slow and inefficient systems.

 

20 x £480.77 = £9615.40.

 

The decision not to outsource your IT and deal with issues yourself is not saving the business £1500 a month, it is actually costing it £9615.40.

And this is without considering the emotional costs involved of taking on additional hours which will likely lead to burnout.

 

In this example, the managing director is costing the business a minimum of £8115.40 a month (£9615.40 – £1500 outsourcing fees) which equals £97,384.80 a year.

And this is without taking into consideration the risks involved with implementing security measures incorrectly which puts the business at risk from going bankrupt should a disaster like a an operational shut down or a cyber-attack occur.

The real cost to the business is far greater than £97,384.80 a year.

 

Time is something you cannot get back, but with money you can.

 

Outsourcing your IT means that you can focus on your zone of genius and the top percentage of the major revenue building activities which will make the business grow. Your employees can also focus on their piece of the puzzle to help the business without being frequently disrupted because of the poor IT.

 

In this example, every hour that you are not spending on revenue generating, specific managing director activities, is costing you £480.77 an hour.

 

When you know what an hour of your working time is worth, you know how much it’s costing you not to be doing the high value revenue generating activities.

 

Start prioritising your business growth by choosing to value your IT provider, and if you do not feel like they are giving enough value to your business, then you may be experiencing symptoms of being an ‘IT-Lost’ Business Founder…

Take our quick fire, no email address needed, 2-minute quiz to receive some personalised resources on dependent on your situation to help you to relieve some of your IT frustrations.

Click here to take Are You An IT-Lost Business Leader quiz now!

What our customers say

Lumina Technologies have taken the time to understand the requirements of our business and work as our strategic IT partner, enabling us to concentrate on delivering a high quality service to our clients and focus on our growth strategy. They have delivered a 100% cloud solution to our business with no underlying infrastructure costs or maintenance, which gives us scalability for our planned growth. It also means our business critical applications and data are securely accessible from virtually all our user devices. Lumina’s professional approach and strategic expertise is highly valued and their management of our IT – based on their in-depth knowledge, leaves us confident that our systems are available 24×7.

Luke Harrison
Keidan Harrison LLP

Lumina have supported us so well through the difficult circumstances of 2020.  They worked extremely hard to ensure we were able to work remotely and continue to operate our business successfully. The support team are very friendly and knowledgeable, and have excellent response times.

The team have also enhanced our cyber security which is so important in the legal sector, and they continue to provide high quality advice to help us move forward with our IT goals.

Robin Illingworth
Managing Partner, Adams & Remers LLP

The quality of IT Support provided by Lumina Technology is of the highest standard and is complemented by effective client liaison with impressive response times. Trap Oil Group plc has no hesitation in recommending Lumina as a dedicated and specialist group of IT professionals.

Martin David
Technical Director, Trap Oil Group plc

Richard and his team are a real inspiration to anyone who meets them and I have watched Lumina’s growth over the last few years with interest and admiration. Richard has been an amazing supporter of the Hospice of St Francis, being a Gold member of the Corporate Partner Network for almost two years. He takes an active interest in the community and is passionate about his company and his town: nothing is too much trouble, he is always willing to help, to give up his time and to provide business advice when asked. Lumina is an inspiration to any company wanting to set up business in Hertfordshire.

Carolyn Addison
Corporate Fundraising Manager, The Hospice of St Francis

Lumina Technologies Prism Hosted Desktop has allowed our business to centralise our global corporate data, allowing much faster access for all our staff – regardless of their location. We have also been able to simplify and reduce our infrastructure and management overhead. With the new Prism Hosted Desktop solution all staff now have simple and secure access to corporate data using any device they choose. Prism Hosted Desktop has increased the productivity of our staff and given us a single, consistent and familiar experience for all users from any device, in any location, 24/7.

Katherine Roe
Chief Executive Officer, Wentworth Resources PLC

The commercially sensitive and regulated nature of Lambert Energy Advisory’s business requires an IT provider able to maintain the highest levels of integrity and confidentiality, Lumina Technologies has consistently been unimpeachable in this regard over the nine years we have employed them.

Patrick Agar
Lambert Energy Advisory

It has been a great pleasure working with Lumina Technologies over the past two years. They have fully committed to being involved in the local community with volunteering and with professional advice and commitment, helping many local charities along the way. As a growing company it proves that being involved in the local community is helping them attract and retain a talented workforce and I look forward to working with them well into the future.

Cindy Withey
Connect Dacorum

Hawkstone Management Services Ltd is a small company for which IT Outsourcing is realistically the only viable option. Lumina Technologies have successfully performed this role for over fifteen years. They also provide innovative solutions to keep pace with technological progress. I would have no hesitation in recommending Lumina to similar sized businesses.

Stephen Pembury
Hawkstone Management Services Ltd

Charles Douglas Solicitors LLP have been using Lumina Technologies for a number of years now and continue to be impressed by the technical know-how and contemporary knowledge of their senior management, who provide a timely, efficient and friendly service. Whether it is a small issue with one computer, or a strategic IT decision, they maintain a current knowledge of available technologies. Lumina are always at the other end of the phone to help resolve issues and minimise business interference. The technical knowledge of Richard and his senior team means that there has not been a problem that they can’t solve to date. I am sure we will continue to use them in the years to come.

Charles Douglas
Managing Partner, Charles Douglas Solicitors LLP

The team at Lumina Technologies have made the Amoun Travel & Tours office IT transition seamless and problem free. The office set-up has been vastly improved and the IT Support services are flawless. No issue goes unresolved, which is extremely reassuring.

Adam Helmy
Amoun Travel & Tours Ltd

Lumina Technologies has been Salamander Energy plc’s IT provider since start-up in 2005 and has supported us in London during our expansion across operational offices in SE Asia. Their professional approach, strategic advice and close co-operation have been essential in making this a success.

John Bell
Group Technical Director, Salamander Energy plc

Richard and his team at Lumina have provided Perrett Laver Limited with high quality strategic and practical IT Services for over ten years. During this period, Perrett Laver has grown from 10+ colleagues based in London to nearly 100 colleagues located in six offices across the Americas, EMEA and Asia-Pacific. Richard and the Lumina team have not just been responsive to our ‘everyday’ IT needs, but have proactively sought to work with us on developing an infrastructure suitable for the type of operation we are today, and are planning to be months and years down the line. I would not hesitate to recommend Richard, especially for small to medium size business with growth in mind.

Clementine McKinley
COO, Perrett Laver Limited

Society Limited has been supported by Lumina Technologies since our earliest start-up phase. From large logistical challenges like an office move, through to smaller fiddly issues like fixing a faulty e-template, we know we can count on their support and advice. They’ve also been able to engage with us strategically on the challenge of scaling-up our infrastructure as the firm continues to grow and evolve. We always feel confident going to Lumina with a problem, since we know they genuinely care about sorting things out and helping us to get on with our core business.

Simon Lucas
Managing Director, Society Limited

The Vita Group HQ staff have worked with Richard McBarnet and Lumina Technologies for over 9 years, with Lumina providing all our PC, server, phone, and software support. The services have included C-level executives based in London, Manchester, the US, as well as supporting home office IT as well. The service provided and intellectual capabilities are outstanding and we would highly recommend Richard and his Lumina team.

Joe Menendez
CEO, The Vita Group

We worked with Lumina on a GDPR Audit. Richard was knowledgeable and professional throughout, and did the best he could to bring a dry topic to life through lots of real life examples and analogies. We were so impressed with the service Lumina provided and the value we got from partnering with them on this project – we couldn’t recommend them enough.

Holly Cottingham, Vintec Laboratories

We’ve been so well supported by Paige and the Lumina team. They’ve been highly professional, very responsive, friendly, supportive. It’s really validated the decision to engage an IT partner, and we’re glad it’s with Lumina. 

Bruce Storey
Chief Operating Officer, Estu Global Ltd

Discuss your business needs today

Get in touch Schedule a call