With the advancement of technology, migration into the cloud, IoT, and an expanding attack surface, the question of who should be responsible for an organization’s security is no longer theoretical. Small organizations often undermine the importance of security because they do not deal with high money cycles, making them soft targets for attackers. This is exactly the wrong conclusion to draw. Security should be considered equally important for any organization or individual regardless of size.
But the real question is more nuanced: can a small organization afford sufficient security? Should they outsource it? Or should they take care of it themselves? And is that even a binary choice?
Stand 1
The Case Against Outsourcing
It is often a tough decision that a company must take whether to outsource security or not. Some say they should not, considering the privacy of data, code, algorithms, and other sensitive and confidential information, especially when handing it to an MSP that might also deal with competing organizations, even with strong service level agreements in place.
Handing over control to a different organization raises questions about the organization’s own capability and challenges its internal security culture. An MSP dealing with multiple organizations simultaneously may put less focus on any single one of them. Handing over cybersecurity entirely only leads to the MSP having the upper hand in SLA terms. The outsourcing company might also force the organization to use specific software that affects efficiency or productivity. The organization might lack the skills to even oversee, control, or define clear and achievable goals for the outsourcing team. That is a serious problem when you cannot verify the quality of what you are paying for.
According to Verizon’s 2024 Data Breach Investigations Report, 60% of data breaches involve third parties including contractors, vendors, MSPs, and supply chain partners with privileged access to systems. In 2024 alone, breaches at third-party providers including Microsoft, Snowflake, and Dropbox had widespread downstream impact on organizations that had outsourced to them.
The 2023 Kaseya attack is the sharpest example: attackers compromised an MSP’s remote management tool and pushed ransomware to thousands of downstream SMBs in a single campaign. The SMBs had no direct relationship with the attacker. They were exposed entirely through their MSP.
The 2024 CrowdStrike Falcon sensor update incident caused millions of Windows systems to crash globally. Organizations that had outsourced their endpoint security had no immediate control. They were entirely at the mercy of a vendor’s update process.
There is also the issue of regulatory compliance. An outsourcing partner may not fully comply with the laws and regulations in your jurisdiction or industry, such as GDPR, HIPAA, or PCI-DSS. If a breach occurs through the MSP, the liability does not disappear from the primary organization. It is still your data, your customers, and your regulatory exposure.
And there is a subtler concern worth naming: outsourcing security can create a false sense of coverage. When security is someone else’s job on paper, it tends to become no one’s priority internally. The internal team stops thinking about threats because they assume the MSP is watching. That assumption has cost companies dearly.
Stand 2
The Case For Outsourcing, Especially for Small and Medium Organizations
The other side of this debate suggests opting for security outsourcing, and for small and medium organizations in particular, the argument is hard to dismiss.
Small organizations usually lack the resources to hire in-house security professionals or sometimes even a CISO. The entire security responsibility falls on the IT team, who may not always have professional cybersecurity expertise. This brings immense pressure, makes security a lower priority than it should be, and creates dangerous blind spots.
In Q3 2024, there were 1.58 million cybersecurity jobs demanded in the United States with only 1.32 million skilled workers available. That is a gap of 265,000 positions in the US alone. Globally the gap hit 4.8 million in 2024, a 19% increase from the prior year. Experienced professionals, those with 2 or more years of relevant experience, represent 76% of supply against demand. You cannot hire what does not exist.
On top of that, 37% of organizations faced cybersecurity budget cuts in 2024. For a small business trying to compete for the same talent pool as large enterprises, the math simply does not work. The average cost of a single experienced security hire, salary, benefits, tooling, and continuous training, can easily exceed $120,000 to $150,000 per year in the US market, for one person covering one area of expertise.
I take the stand that small and medium businesses should, in most cases, outsource cybersecurity, for the following reasons.
The time and cost to hire and train security professionals is very expensive relative to a small company’s margin. And hiring a limited number of staff may not be efficient because cybersecurity expertise is highly specialized: network security, secure application development, incident response, threat intelligence, and compliance are each their own discipline. A two-person internal team cannot credibly cover all of them.
The primary benefit is lower costs through consolidation. Individual aspects such as risk analysis, security appliances, applications, and intrusion detection are much more cost-effective when bundled under a managed service than when purchased and staffed independently. Organizations that engage MSPs can lower overall IT costs by 20 to 30% while boosting productivity by 15 to 25%, according to research by Cyber Solutions.
The second is 24/7 protection. Security incidents do not respect business hours. An outsourced SOC provides constant monitoring, detection, and response around the clock in a way that a small internal team cannot sustain without burnout or prohibitive cost. According to industry experts, a good managed security provider offers 24/7 monitoring, detection, and response to security incidents as a baseline.
Third is proactive security and breadth of expertise. MSPs work with dozens or hundreds of organizations simultaneously. This means they see threat patterns across a wide landscape, develop institutional knowledge faster, and tend to stay ahead of emerging attack techniques. They provide independent validation of an organization’s security posture and bring a systematic approach to improvement that an internal team focused on daily operations rarely has bandwidth for.
Even large organizations can benefit from selective outsourcing. Outsourcing intrusion detection or threat intelligence, for example, provides an extra layer of coverage and an immediate response capability that minimizes the effect of a security incident. The 2024 Splunk State of Security study found that expanding outsourcing for security operations is a top-five goal for enterprise security executives.
What You Risk Losing
- Direct control over your security posture
- Context-specific knowledge of your own systems
- Confidentiality if the MSP handles competitors
- SLA leverage when things go wrong
- Regulatory ownership in the event of a breach
- Internal security culture and awareness
- Freedom from vendor lock-in and forced tooling
What You Stand to Gain
- Access to a full team of specialists immediately
- 24/7 monitoring and incident response
- Cost savings of 20 to 30% vs in-house equivalents
- Scalability as the organization grows
- Breadth of threat intelligence from many clients
- Reduced time-to-detect and time-to-respond
- Independent security validation and auditing
The Dilemma
Why This Is Not a Simple Decision
The problem with framing this as outsource versus in-house is that it treats security as a binary, when in practice it is a spectrum. The real dilemma is not whether to outsource. It is what to outsource, to whom, under what contractual terms, with what level of internal oversight, and how to ensure the arrangement does not itself become a liability.
The talent shortage makes pure in-house security increasingly untenable for most organizations below a certain size. But blind outsourcing, handing everything over with minimal internal capability or oversight, creates a different category of risk. The third-party risk data makes this clear: 60% of breaches in 2024 involved a third party. When you outsource, you are not transferring your risk. You are adding a new attack surface and a new dependency.
There is also the cultural dimension that no MSP can solve. Even the best security outsourcing company cannot protect an organization from a phishing attack that an employee clicks on, or a password reused across personal and corporate accounts, or a developer who pushes credentials to a public repository. Security culture, awareness, and behavior at the individual level is the sole responsibility of the organization. No SLA covers it.
The Solution
A Framework by Organization Type
The answer is neither pure outsourcing nor pure in-house. It is a deliberate hybrid model scaled to the organization’s maturity, budget, and risk profile. Here is how that looks across different stages.
| Organization Type | Recommended Approach | Rationale |
|---|---|---|
| Startup 0 to 50 employees |
Outsource almost everything to a reputable MSSP. Retain one internal security-aware technical lead to own vendor oversight and internal culture. | Budget is limited. Threat surface is growing fast. Speed of setup matters. Internal oversight prevents blind trust in the vendor. |
| SMB 50 to 500 employees |
Outsource monitoring, SOC, and incident response. Build a small internal team for governance, compliance, and security awareness. Own your policies and your data classification internally. | At this size, compliance obligations grow. You need internal accountability. But you still cannot staff a full SOC economically. |
| Enterprise 500+ employees |
Build an internal security team for governance, architecture, and detection engineering. Selectively outsource specialist functions: threat intelligence, red teaming, forensics, and after-hours SOC coverage. | Internal context and control become critical at scale. But no internal team has every specialty. Targeted outsourcing fills the gaps without surrendering control. |
A startup should implement security in-house conceptually, meaning it should own its security strategy and culture from day one, while outsourcing execution to a managed provider to build a robust defense from the roots, at least until the company grows to independently handle security around the clock and face any challenge that comes its way.
Before You Outsource
- Verify the MSP does not service direct competitors or obtain written non-disclosure protections specific to your industry
- Audit the MSP’s own security posture. Ask for their SOC 2 Type II report, penetration test results, and incident history
- Understand who your MSP sub-contracts to. Fourth-party risk is a real and documented threat vector
- Define clear SLA terms around detection time, response time, escalation paths, and breach notification obligations
- Retain ownership of your data and ensure contractual rights to retrieve it if the relationship ends
- Build internal capability to audit and validate what the MSP reports. You should never be entirely dependent on their word
- Run parallel internal security awareness training. The MSP cannot protect against social engineering at the individual level
- Define an exit strategy before you sign. Vendor lock-in in security is dangerous and expensive to undo
- With the advancement of technology, migration into the cloud, and IoT, the target surface grows every day. Small organizations that undermine the importance of security make themselves soft targets, regardless of how small the money cycle is.
- Pure in-house security is increasingly impractical for most small and medium organizations. The global talent gap hit 4.8 million unfilled positions in 2024. You cannot hire your way out of this problem at SMB scale.
- Pure outsourcing is not the answer either. Third-party vendors were involved in 60% of breaches in 2024. Outsourcing transfers execution, not accountability.
- The right answer is a deliberate hybrid: outsource the functions that require round-the-clock coverage and specialist depth, retain internal ownership of strategy, governance, compliance, and culture.
- No MSP can protect an organization from a phishing click or a reused password. Security culture must be built internally regardless of what is outsourced.
- Before signing with any MSP, audit their own security posture, understand their sub-contractors, define your SLA terms with precision, and build an exit strategy. The vendor relationship itself is a risk to be managed.
References
- ISC2. (2024). Cybersecurity Workforce Study 2024. isc2.org
- IBM Security. (2024). Cost of a Data Breach Report 2024. ibm.com
- Lightcast. (2024). Quarterly Cybersecurity Talent Report Q3 2024. lightcast.io
- Verizon. (2024). Data Breach Investigations Report 2024. verizon.com
- Splunk. (2024). State of Security 2024. splunk.com
- CrowdStrike. (2024). In-House vs Outsourced Cybersecurity. crowdstrike.com
- FINRA. (2024). Cybersecurity Advisory: Increasing Risks at Third-Party Providers. finra.org
- JumpCloud. (2024). MSP Market Statistics. cyvent.com
- Allianz. (2024). Risk Barometer 2024. allianz.com
- ayehu.com: Should you outsource cyber security?
- netstandard.com: Benefits and risks of outsourcing IT
- consultancy.uk: Five reasons outsourcing cybersecurity adds value
- thrivenetworks.com: Benefits of outsourcing cybersecurity