Small Businesses Waste $24B Annually Trying to Manage Their Own IT Environments

A new Microsoft (NASDAQ: MSFT) backed research study discovered that SMBs worldwide fritter away some $24 billion in productivity annually by assigning non-technical personnel to manage their IT environments. Read between the lines, and the study makes the case for small businesses to more effectively leverage Managed Service Providers (MSPs), Value Added Resellers (VARs) and cloud computing.

The study, conducted by researcher AMI-Partners, examined the impact of so-called involuntary IT managers (IITMs) at SMBs in North America, Latin America and EMEA tasked with handling their companies’ IT solutions. In particular, the research focused on the impact on business productivity of IITMs in the U.S., Australia, Brazil, Chile and India.

The $24 billion lost annually results directly from IITMs taking time away from primary business activities to perform IT management functions for which many are ill-prepared, according to the study’s findings. AMI surveyed 538 IITMs in small businesses with 100 employees or less and, from that data extrapolated that 3.8 million SMBs in the target countries manage IT internally with non-technical personnel.

While SMBs in the study invested $83 billion to equip their businesses with IT and communications equipment, they lost $24 billion in productivity trying to internally manage their IT environments. When asked about a solution to the problem, IITMs in the study believe that cloud-based solutions can ease some of the burden of managing IT.

“Many small businesses don’t have the budget for formal IT support, so they rely on the company’s most tech-savvy individual to manage their technology,” said Andy Bose, AMI Partners founder, chairman and chief executive. “As our research shows, relying on an Involuntary IT Manager can have an adverse impact on small businesses’ productivity, which can negatively affect revenue and translates into a very high opportunity cost.”

Other than pointing out how much productivity SMBs lose from fussing with managing IT operations on their own, the study’s findings indicated a movement to cloud services by SMBs. Indeed, some 33 percent of IITMs said they are likely to shift more IT spending toward hosted or cloud solutions while 36 percent are interested in a productivity and collaboration suite.

“The cloud when delivered right is a game-changer, providing small businesses with the IT solutions they need to solve their most challenging small-business technology concerns,” said Thomas Hansen, Microsoft SMB worldwide vice president.

Some highlights of the study’s findings:

  • On average, IITMs lose about 300 hours per year of business productivity while managing IT
  • 36 percent of IITMs feel that IT management is a nuisance
  • 26 percent indicated they don’t feel qualified to manage IT
  • 60 percent of IITMs want to simplify their company’s technology solutions to alleviate the difficulty of managing IT day-to-day

Reposted with modifications from: