It's a question many business owners and executives wrestle with: should we hire our own IT person, or is it more sensible to use an external provider? There is no universal solution. But there is a proper approach to finding the answer that fits your specific business.

This article lays all the cards on the table. No sales pitch. Just an honest overview of when one approach makes more sense than the other.

What does it actually cost to hire in-house IT?

An IT employee in Denmark typically costs 450,000–650,000 DKK per year in salary, depending on experience and specialization. On top of this come holiday pay, pension, sick days, training, and office costs. The real total cost is usually 30–40% higher than the gross salary.

But there's a problem that rarely gets mentioned: breadth of skills. A single IT employee is often expected to do everything: support, networking, security, cloud, backup, Microsoft 365, telephony. It's not realistic. One person can cover most day-to-day needs but lacks depth in specialized areas. And if your IT person takes vacation or gets sick, you're vulnerable.

What does IT outsourcing cost?

Prices for IT service agreements vary widely, but as a rule of thumb:

  • Small business (5–15 users): 3,000–7,000 DKK/month.
  • Mid-sized business (15–50 users): 7,000–20,000 DKK/month.
  • Larger SMB (50–150 users): 20,000–60,000 DKK/month.

For many SMBs, this amounts to a fraction of the salary cost of a single in-house employee, and you get access to a full team of specialists in security, networking, cloud, and support.

Remember: Don't just compare the price of the agreement with a single IT employee's salary. Compare the total cost, including pension, holiday, sickness, training, and the risk of vulnerability during absence.

When does in-house IT make sense?

There are situations where an in-house IT function is the right solution:

  • Highly complex, industry-specific IT: companies working with, for example, specialized ERP systems, production control, or healthcare data may need someone who knows the systems in depth and is physically present every day.
  • Large enough scale: above roughly 100–150 users it typically starts to make sense to have at least one in-house IT coordinator who works with an external partner.
  • Special compliance requirements: certain industries and public-sector contracts require IT functions to be handled in-house.
  • IT as critical business development: if IT is at the core of your business (software, platform, digital service), you should have in-house competence to drive it strategically.

When does outsourcing make sense?

For the vast majority of Danish SMBs under 100 employees, outsourcing is the most flexible and cost-effective solution, especially if:

  • IT is a support function, not your core business
  • You need breadth and specialization without hiring 3–4 people
  • You want predictable monthly expenses instead of variable salary costs
  • You need coverage outside normal business hours

Questions to ask a potential IT partner

Before signing any agreement, you need answers to these questions:

  1. Who is my dedicated contact person? A good provider assigns you an account manager or technician who knows your business.
  2. What is your guaranteed response time? And does it vary by type of issue? Critical downtime should have a response time of under one hour.
  3. What is included, and what is billed separately? Many agreements look cheap but come with long lists of add-on services.
  4. How do you handle a security incident at 2 a.m.? Do they have on-call standby? What triggers it?
  5. What happens if we want to switch providers? You own your data and systems. A serious provider ensures a smooth handover.

What a good SLA should include

An SLA (Service Level Agreement) is the contract that defines the service level. Demand these elements:

  • Defined priority levels (critical, high, normal) with clear response and resolution times for each
  • Availability: when support is accessible, and what applies if downtime occurs outside business hours
  • Escalation procedure: who you contact if the problem isn't resolved within the agreed timeframe
  • Monthly or quarterly status report on incidents and preventive work
  • Clauses on data handling and GDPR compliance

Red flags when choosing an IT provider

Watch for these signals during the sales process:

  • No clear SLA or "we'll take it case by case": uncertainty about the service level is your problem, not their advantage.
  • Prices are extremely low: cheap IT support is often slow IT support. Ask precisely what the price covers.
  • They own your passwords and access: you should always have full access to your own systems, domains, and licenses. A provider that keeps this to itself creates dependency.
  • They sell everything themselves: hardware, licenses, hosting, and support. This creates a risk of conflicts of interest and overpricing.
  • No references: ask to speak with 2–3 existing customers of the same size and industry as you.

Choosing an IT partner is an important decision. Take time to compare thoroughly, and don't let price alone determine your choice. The cheapest solution can quickly become the most expensive if it fails when you need it most.