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The two most important considerations for your business’s IT is how you’re paying for it and why. Most of the agreements you would enter into today are managed agreements. They’re a fixed price for an expectation. The expectation is that everything’s going to work.

In the old days, we lived in a break/fix world. A technician would come fix something, you would pay them for an hour’s worth of labor, they’d leave, and they’d come back when something else inevitably breaks. The problem is that this relationship is bad for both the IT provider and the business owner.

It’s bad for the IT provider because they’re only being paid for the hour—they’re not being paid to look under every rock, to be thorough, and to ensure nothing else breaks. It’s bad for the business owner because they’re not incentivized to pay for preventive measures that will keep things from breaking. For example, if you pay $200 to have somebody fix something, you’re not going to say to the IT provider, “Hey, why don’t you hang around for four hours while you’re here, and we’ll pay you another $600 to make sure nothing else breaks next month?”

Instead, you’re going to say, “Hey, you fixed today’s issue. Now get outta here.” It’s sort of like not maintaining your car—eventually, you’re driving around in a jalopy.

In contrast, the managed agreement works better for both entities. It works for the IT provider, who is now highly incentivized to make sure nothing breaks in the first place. As the business owner, you’re highly incentivized to pay for the right things. When you’re paying X price, you’re always paying for prevention. Your ongoing expectation that everything will work as it should gives the IT provider the proper motivation to make sure nothing breaks.

In today’s world, the fixed set price is the only way IT services should be purchased.