In this blog, we’ll discuss the advantages of a break/fix model and why this classic IT strategy is slowly fading away.

What is break/fix?

Break/fix IT is defined as the reactive model of hiring IT service providers to perform one-time services and pay them only for the work done plus the cost of parts.

Under this model, a business calls an IT service provider whenever there is downtime due to a system breakdown, network disruption or hardware failure. The technician then comes to the client’s location to fix issues and bills the customer an hourly rate plus the cost of parts. There is no continuous support or maintenance work involved in this model. IT support teams are called out for services on an “as-needed” basis.

What is a break/fix issue?

Break-fix issues refer to a situation where a device, system or network stops functioning correctly and requires a repair or replacement. These issues can occur for various reasons, including virus attacks, hardware failures, software malfunctioning or user errors, and technicians can usually fix them during a one-time visit.

What is an example of break/fix?

Imagine your network is down, and you must deliver invoices to your clients. What would you do? You would immediately call an IT guy to get your network up and running quickly. Here, you are making use of a break/fix service.

Break/fix IT services usually involve emergency calls and the associated on-site visits, including virus removal, hardware repairs, new installations, software upgrades, component replacements and more. Once the services are performed, and everything’s back to order, the break/fix technician bills the customer.

There’s no discussion of strategy or maintenance of an organization’s IT infrastructure. This purely transactional approach to software, hardware and network service means organizations get exactly what they need to keep things running. This once sounded ideal from a customer perspective. Why pay for IT when everything’s working? You don’t pay for plumbing when the faucets are fine, right?

Advantages of the break/fix model

The break/fix model gives businesses certain advantages, although these benefits may also be the subject of debate. Let’s take a look at some of them.

• No monthly subscription or contract: Small businesses not overly reliant on technology or with just a few technology users may want to avoid budgeting a monthly IT cost or entering into a contract with an MSP. They may not understand the true value of IT and are looking to save on fixed costs as much as possible. Break/fix is the best option here. It’s for this reason that the break/fix model is popular among especially non-technical end users. However, for businesses relying on higher IT requirements every day, break/fix could be a real gamble.
• Complete control of IT needs: Businesses here have the privilege to decide where to spend their IT budget, so they feel more in control. However, this idea of intelligent expenditure is an illusion since they have little or no control over what they are paying for or how the break/fix vendor is fixing their IT issues.
• A convenient business option for IT service providers: Break/fix is an easy business approach for IT service providers since they need to charge only the hourly rates and for parts instead of creating and managing monthly or yearly contracts. Additionally, there is no overhead in maintaining business-client relationships as these are usually one-time services, requiring only quality fixes to maintain a good reputation in the market.

Challenges with the break/fix model

Undoubtedly, there are drawbacks to the break/fix model and many businesses find the cons outnumber its pros.

• No SLA: Break/fix services often lack a robust service level agreement (SLA). The response and repair time depends on a service provider’s current availability and workload, posing risks for organizations that rely on their IT infrastructure to carry out their everyday operations. A significant downtime can damage the brand’s reputation and revenue. Moreover, businesses must act immediately during a cyberattack or data breach. Depending on a break/fix service provider in such scenarios might cost a fortune.
• Unpredictable costs: Since work is billed hourly, businesses choose quick, short-term fixes over long-lasting, intensive solutions. Likewise, break/fix IT service providers repeatedly provide temporary fixes instead of a long-term solution since they earn more significant revenue with more callouts — every issue is handled case-by-case, leading to invoices with unpredictable costs.
• Hidden threats: Often, minor IT issues can cause severe damage and revenue loss if left unattended for a long time. With no one monitoring IT systems for underlying problems and looming cyberattacks, companies are in for severe downtime and costly repairs.
• Increased downtime: Due to the “as-needed” nature of the break/fix model, technicians who come in to repair your system will have little or no familiarity with your IT infrastructure. They will take time to get acquainted before detecting and fixing issues. This way, the downtime will increase, and you will pay more based on the time consumed.

What is the difference between break/fix and managed services?

While break/fix once served as the standard IT service delivery model, it has now seen better days. IT infrastructures have become complex, requiring businesses to manage and maintain more endpoints and deal with greater IT concerns. Break/fix fails to address these problems, leaving businesses searching for better options.

Enter managed services, where technicians continuously monitor and manage all endpoints within your IT ecosystem and ensure hassle-free operations. This model adopts a proactive approach to preventing IT issues from happening in the future and provides maximum uptime. Additionally, services are billed on a subscription basis, where businesses pay a fixed monthly or yearly amount as agreed in their SLA.

Here are some of the key differences between break/fix and managed services:

Why is break/fix declining in popularity?

Since new technologies continue to disrupt the break/fix operating model, more and more organizations choose managed service providers (MSPs) to take care of their IT. As per the Kaseya Global MSP Benchmark survey, 51% of technicians reported break/fix is one of their most time-consuming activities.

Additionally, most businesses believe that the break/fix model inherently creates perverse incentives where MSPs see commercial gain from waiting to fix IT issues when requested than proactively preventing them from occurring in the future.

Why are managed services thriving?

Managed services are focused on continuous IT management and productivity improvement. They provide a proactive approach to IT services and also offer a subscription-based payment system. Managed services are designed to optimize business performance, ensure scalability and future-proof digital IT operations through:

• Endpoint monitoring and management: Monitor and manage on-prem, hybrid and cloud infrastructure.
• Help desk: Instantly remediate IT tickets to protect networks and ensure hassle-free IT operations.
• Security: Secure devices with AM/AV protection, patch management and security reporting.
• Backup and disaster recovery: Perform regular data backups and quick recovery during downtime.

Transition from break/fix to managed services with Kaseya

If you are a break/fix service provider losing customers to managed services, now is the time to enter an MSP business and take the bigger slice of the lucrative IT services market.

When it comes to a successful MSP business, efficient IT management is the key. Offer a best-in-class managed service to your customers with Kaseya VSA.

Kaseya VSA is a revolutionary remote management and monitoring service engineered for MSPs to deliver high customer satisfaction. VSA automates most IT processes and helps you manage the entire IT infrastructure from a single console. It integrates seamlessly with other applications and automates workflows between different tools, eliminating human errors and tech inefficiencies.

Want to learn more about VSA and see it in action? Schedule a demo now.

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What Does Break/Fix Mean?

A method of providing IT support to client companies, as noted in this article on TechTarget, break/fix services are generally fee-based and rely on the customer to contact the IT services company when repairs or upgrades are needed. Break/fix service providers typically work on a time-and-materials basis wherein they charge an hourly rate plus the cost of parts.

With break/fix services, providers generally do not commit to service-level agreements (SLAs). Factors like service response times and fees depend on the severity of the issue and, of course, how long it takes to resolve the problem.

Pros and Cons of Break/Fix IT Support

The break/fix model does have some allure from the client’s perspective. For example, there’s no up-front investment in IT services. It is totally a pay-as-necessary model. This could be attractive to small businesses that have simple IT needs, such as keeping a small number of office computers up and running.

Implementing the break/fix model is also hassle-free for IT service providers. They need to charge only technician labor rates and for parts, rather than selling, creating and managing monthly or yearly service contracts.

The downside to break/fix IT support is the lack of proactive monitoring or preventive maintenance of the clients’ IT systems. In other words, you are just waiting for something to fail rather than taking measures to prevent it from happening. Not the best way to run a business (especially if you are the client). That server failure, for example, could happen at the most inopportune time.

Also, it’s not in the financial interest of the service provider to fix the problem quickly. So, the client may end up paying more to fix the issue.

Breaking Away From the Break/Fix Model

While break/fix was once the standard IT service delivery model, providers have been moving away from it. For the past decade, IT environment complexity has continued to grow for businesses of all sizes. Client companies have to manage a much larger number of endpoints, deal with major IT security concerns and tend to more complicated IT networks. To maintain system uptime in today’s complex IT environments, a more proactive IT management approach is required.

Enter managed services, where IT systems are proactively monitored and routine maintenance is performed as part of a standard services contract. Under the managed service model, the client is typically billed monthly or annually for the services provided, which are backed by SLAs. There is generally a flat monthly or annual fee, often based on either the number of endpoints under management or the number of end users in the client’s business.

This model has a huge advantage for managed service providers (MSPs) since it provides a steady and predictable revenue stream. Break/fix, on the other hand, is very unpredictable from a revenue standpoint. Of course, the managed services model has major advantages for the client as well. The proactive IT management approach means that it’s much less likely that there will be a major disruption to the business due to an unforeseen IT system failure. And, with managed services, it’s in the best interest of both the client and the service provider to fix issues quickly.

Today, managed IT services typically include:

• Endpoint Monitoring and Management – Proactive monitoring and management of the client’s IT infrastructure, on-premises, remote/off-network or in the cloud. This can include automated processes for routine server and workstation maintenance as well as auto-remediation of common IT incidents.

• Help Desk – Technical support for end users
• Security – Keeping devices secure with antivirus/antimalware protection, automated software patch management and security reporting
• Backup and Disaster Recovery – Data storage, backup and recovery testing

Managed service providers make use of tools such as remote monitoring and management (RMM) and professional services automation (PSA) to manage their clients’ IT infrastructure and run their MSP businesses. Kaseya VSA, a powerful RMM solution, enables MSPs to remotely manage and troubleshoot end-user computers efficiently. Kaseya provides the most comprehensive IT management platform — IT Complete, to help MSPs win at every stage of their development and grow monthly recurring revenue (MRR).

If you are looking to establish and/or grow your MSP business, download our pricing guide, MSP Guide to Higher Growth: Pricing for Profitability.

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