Managed IT vs Break-Fix: Which Costs an Ontario Business Less?

Break-fix is billed per incident or per hour, after something has gone wrong. Managed IT is billed per user per month, and the fee covers the routine work that keeps things from going wrong, plus support when they do.

The billing model decides what your provider is paid to care about. A break-fix technician earns when your server fails. A managed provider loses money when it fails, because the fix comes out of a fee that’s already been paid. That one difference explains most of what follows on this page.

It also explains a complaint we hear in a lot of first conversations: we’re paying for managed IT, but we’re still chasing them when things break. Plenty of Ontario businesses are on a monthly invoice that buys break-fix behaviour. A name on the contract doesn’t change the model. What happens between your calls does.

Break-fix makes sense for a very small team that works almost entirely in the cloud, has no server, stores nothing sensitive and can live with a day of downtime. For that business, paying per call can be the honest, cheaper choice.

We’d rather say that plainly than pretend every business needs a monthly agreement. A 3-person design studio running Microsoft 365 on laptops is a different risk from a 30-person manufacturer with an ERP server on the shop floor.

If break-fix is where you’re staying for now, do these yourself, because nobody else will:

• Turn on multi-factor authentication for every account, including the shared ones.
• Make sure computers install updates automatically, and check that they actually did.
• Keep a backup outside Microsoft 365 and restore a file from it once a quarter.
• Write down where the admin passwords live, and make sure the business owns them.
• Remove access the same day someone leaves.

The Canadian Centre for Cyber Security’s baseline controls for small and medium organizations is a good free reference for the rest.

Break-fix leaves out everything that happens before a failure: patching, monitoring, backup testing, security tools, documentation, staff onboarding and offboarding, and planning. Those are the jobs that prevent the expensive calls.

None of it shows up on a break-fix invoice, which is why the model looks cheap. It shows up later as a laptop that hasn’t been patched in 8 months, a backup that failed quietly in the spring, or a former employee who still has email access in the fall.

The risk isn’t abstract. Statistics Canada reports that 16% of Canadian businesses were impacted by a cyber security incident in 2023, and that business spending to recover from incidents roughly doubled from about $600 million in 2021 to $1.2 billion in 2023. Microsoft reports that MFA plus blocking legacy sign-ins stops more than 99.9% of common identity attacks. That’s a setting someone has to turn on and keep on, which break-fix never pays anyone to do.

If nothing visible happens between your calls, you’re likely paying a managed fee for break-fix service. A real managed provider shows its work: patch reports, backup tests, security alerts handled and recommendations you didn’t ask for.

Every MSP says it’s proactive. The word has stopped meaning much, so ask for proof instead:

1. When was our last backup test restore? Ask to see the result.
2. What did monitoring catch last month? A real answer names specific alerts.
3. What are you recommending for next year, and why? Silence is an answer.
4. Who knows our setup? A named contact, or whoever picks up.
5. Where is our documentation, and who owns it? It should be yours.

If the answers are thin, our posts on signs you’ve outgrown your IT provider and what to run from in a managed IT provider go further. We also wrote about the older version of this question, managed IT plans vs monitoring-only plans.

Start with an assessment of what you have, then phase the move over 60 to 90 days so the business keeps running. Critical systems are brought under management first, checked, then the rest follows. There’s no cutover weekend.

Moving off break-fix usually turns up a backlog. Computers that missed a year of updates, accounts nobody uses, a backup job that stopped. That catch-up work is part of onboarding, and we tell you about it before you sign rather than after. Our 90-day onboarding breakdown walks through what happens in each phase.

The risk of switching is usually smaller than it feels. One manufacturing CEO stayed 3 extra years with a provider that wasn’t working because he was afraid of what would break during the move. A phased onboarding and a 90-day exit clause on Managed IT exist for exactly that worry.