The Benefits of Outsourcing to Managed Services
The current surge of rapid technological advance has left many entities baffled on various fronts in terms of dealing with their infrastructures in an efficient, productive and secure manner.
Most simply do not possess enough IT Staff to deal with all the nuisances of the day.
And the ones that they do employee are generally not fit to constantly run and fix everything. Usually these people are understaffed, overwhelmed and not trained for their type of infrastructure.
After everything has been set up and business starts chugging along, management tends to turn IT in to an after thought. Rarely does everything continue to work as smoothly as when it was first deployed. Vital services start to lag or worse crash.
Soon clients start to complain about the lack of that same service and all of this results in loss of productivity, stability or worse, reputation.
When dwelling on this issue, several questions tend to pop up:
- Should we train and/or expand our IT Staff?
- Is it affordable to regularly demand fixes from our Local Tech Shop?
- What does the accumulative impact result to?
- What can we do to transition from this uncomfortable situation?
The answer and ultimate solution to these questions could be: Managed Service Providers
WHAT ARE MANAGED SERVICES?
1. A Brief Overview of Managed Services
Managed Services simply mean that a third party will give out, well, services in order to help an SMB (Small & Midsize Business) for example to keep delivering on a certain quota, usually for a predetermined monthly/annual fee.
SMB owners can apply to an MSP (Managed Service Provider) in order to request such an agreement.
A Managed Service Provider is the entity which will handle all requested services for the client, of course if previously agreed upon.
Although many different fields develop & offer Managed Services, we will be focusing on the IT field specifically, where MSPs seem to be the most dominant.
2. The History of Managed Services
But first, a bit of history on just how Managed Services came to be.
Way back, when technology started to take over as the new means of service, storage & communication, most businesses embraced this sudden opportunity & bought various types of IT equipment.
Well the IT Equipment Providers at the time would come and install everything for a one time free and after that these businesses usually did not have trained staff on hand to deal with everyday issues.
Most of the time they would call local Repair Centers in order to come and fix whatever was broken. But this reactive nature didn’t prove to be effective since in the meantime, there would be significant amounts of downtime. Time that drove away customers and gave bad reputation.
As technology moved on, servicing got more complex since whoever was repairing this equipment was usually not previously familiarized with how everything worked at these companies so they needed good time in order to analyse the situation and provide a solution. As we previously mentioned, this wastes time.
There simply had to be a change.
Enter Managed Services, or well, the primitive versions of it.
IT Centers started offering a more centralized and managed way of delivering solutions to their clients. Usually this involved a more intimate relationship with the clients infrastructure.
They introduced monitoring equipment & 24/7 Standby Staff, some of which were even deployed as workers at the companies themselves.
This turn of events converted that Reactive nature of their services to Proactive.
This provided benefits for both sides. The clients felt significantly safer knowing that someone is constantly monitoring their equipment for failure and providing fixes continuously.
While the Service Providers at the time gained a more stable client base and regular income.
The biggest upside was, downtimes were few and far between, everything was a lot more stable and well, a lot more “Managed”.
In order to conclude such an agreement, they used SLAs or (Service-Level Agreements)
An SLA in short is a sort of contract between the service provider and their clients. They define what the client requires and in what quantities.
Basically this is the part where all the given resources are discussed in detail.
This provided mutual, both high and low level understanding of all the services that would be provided to the client.
3. Different Industries That Provide Managed Services
Previously we mentioned that there are different fields where Managed Services are provided.
The following are some of them:
- Work Force Management
- External HR (Human Resources)
- Finance Management
- Compliance Management (Both IT & Legal)
This should give you an idea that Managed Services are very much active in most fields and are a beneficial and often necessary piece of a much larger puzzle.
DIFFERENCE BETWEEN MANAGEMENT & SIMPLE OUTSOURCING
Managed Services sounds like puffed up jargon for simple Outsourcing and although the differences can be very subtle to detect sometimes, they are usually used interchangeably.
But that does not mean they are the same.
The main difference falls in the model & involvement of the services they offer.
A simple outsourcing from a third party company could give you a temporary fix or even certain maintainability. But here, you are more or less asking for a very specific new part/service to be introduced to your infrastructure for a specific time-frame, no more no less.
Managed Services tend to integrate themselves a lot more than simple outsourcing.
Most of the time they become extensions of the clients infrastructure and start worrying on how to improve the work flow a lot more thoroughly and introduce new measures that are not always discussed with the client.
Basically the client here works on trust that the MSP will provide all the best and most necessary solutions possible.
This excludes the client from having to make tough calls all the time, especially if they are not familiar with the field.
Most importantly Managed Service Providers are going to share your goals and ideals, since the better you perform the more they sustain their clientele & reputation in the long run.
Directly pinpointing where the difference start can be rather evasive, but the discrepancy between their work models looks to be the main separation between the two.
THE PROS & CONS OF MANAGED SERVICES
When it comes to solutions, no matter how good something may seem to be, it is rarely the silver bullet for all of your problems.
In this case, Managed Services can provide a plethora of benefits to their customers, but it is our duty to stop and think about the drawbacks of such an engagement as well.
Of course, the first thing that comes to mind when we discuss Managed Services is the acquiring of their expertise. Most Managed Service Providers have all sorts of experts on standby since their industry is a very dynamic one and are faced with a vast amounts of issues daily. Thus their employees need to be prepared to provide solutions, constantly. This means that Clients can spend more time focusing on their products instead of worrying who to call.
Maintenance & Support
Usually Managed Service Providers implement & monitor the infrastructure 24/7 and even have support on standby. Having your infrastructure maintained like this and being provided with an on-call expert for any issue means that the client will benefit greatly in terms of stability. Not having to deal with constant breakdowns can be an uplifting experience, especially in a very competitive environment.
There is a big difference in QOS (Quality of Service) between providers. Some are basic while some are thorough. Choosing the right Managed Service Provider can land you an experienced team that is capable of providing not only the service they have been asked for but also the security that comes along with it. By doing everything by current standard Best Practices, MSPs assure the client that their infrastructure is up to standard and ready for most nuisances.
Being up to par with Best Practices can provide a good platform for the client to pass any audit regarding their industry. It is the difference between becoming compliant in 1 or 6 months. If you are being held on best practice standards constantly, getting to a compliant level should be easy, in theory.
Decision Making & Strategy
Since most MSPs are experts in what they do, as such they can provide better daily Decision Making & Strategies than what their clients could. This in turn results in a far more constructive environment that could benefit their clients greatly.
Most of the time, developing, buying or maintaining solutions on your own can become cumbersome over a good period of time. This means that you have to worry about multiple costs coming from all sides on matters that your team might not really be that knowledgeable about.
This in turn means training, simple outsourcing, equipment maintenance etc. A Managed Service Provider will probably handle most things for a fixed monthly/annual price. Clients taking this endeavour on their own can find themselves paying a lot more than what they would usually do when collaborating with an MSP.
Today, Managed Service Providers are wide spread, especially in the IT Industry. As such there are plenty to choose from. This in turn gives some bad apples as well. There are a lot of them that simply do not provide the high-grade services they advertise to do.
False advertising is the biggest issue here. Also expertise in the IT field is very debatable.
Some think 2-3 Years of working experience is expert level while others believe 10+ might be something among those lines. It can get very confusing as to what you are getting as these key words can mean anything in the eyes of the provider.
MSPs can become quite rigid after a good amount of time providing services to a client. This is due to what is called a safe-zone.
Once they get the client up and running it is might be hard to introduce new trending ideas since that would mean a lot more work in fields they are not particularly knowledgeable about.
Some Managed Service Providers take this as a challenge and involve it if they see a clear benefit for the client, some don’t. It can be very problematic if the provider you choose refuses to expand from what they have been used to doing all this time.
In some cases, the client would not have a big enough infrastructure or budged that can demand a full blown Managed Service Providers. It is always best to make decisions in a more realistic manner, since MSPs can definitely get quite expensive.
During the course of your venture with a Managed Service Provider they can tend to get very authoritative on their decision making and exclude you from vital discussions.
On one hand it is understandable that they would know more on how to conduct themselves in their own field, but this can get overwhelming when they start to take matters in to their own hands completely. The clients should always be careful in what their agreement states and how involved they should be.
WHAT TO CONSIDER BEFORE APPLYING FOR MANAGED SERVICES?
As with any service or product you buy, first a good amount of consideration needs to take place. Applying for Managed Services is no exception.
One of the most common mistakes small business do is engage with MSPs that are not well established. While reputation is by no means the measure of quality, having a solid understanding of who you are dealing with and being bolstered by the fact that they have been around can ease the trust between the two. Remember, you are providing access to your infrastructure, this requires some research in order to stay safe.
The next thing to consider would be your needs:
- What do we need to improve?
- What do we lack?
- How urgent are our needs?
- On what scale should the MSP work?
There is definitely a lot of material to consider before producing an offer.
If you are not aware of your current infrastructure and which segments actually need improvement and by what measure, you are doing to have a hard time determining everything else.
Urgency is another matter. Usually when talking to a Managed Service Provider you will need to state a time frame which will reflect heavily on the pricing and availability. Talking these matters through with your IT Staff or hiring an IT consultant would be a good move before continuing.
The main problem usually lies with the budget and how much you want to spend on your IT Sector.
Truth be told, today technology is such an integral part of our business that it is impossible to divide it as simply as that. It more often than not, demands a higher budgetary cut in order to have everything working as smooth as possible. This in turn provides you with less headaches and more focus on your primary role.
By having a solid grasp on your needs you ensure that you are ready for that MSP interview and know exactly what you need and how much you need it.
CHECKLIST: FIND OUT IF YOUR BUSINESS ACTUALLY NEED MANAGED SERVICES
In order to get a good sense of your actual need for Managed Services, we have developed a quick checklist for you:
- Do you have infrastructural issues at the moment?
- Are these issues occurring more often than not?
- Do you have IT Staff capable of dealing with your type of issues?
- Do these issues get in between you and your clients?
- How often are you bringing outside help?
- Do they generally cost more than what a normal MSP quote would be?
- Do you have time to focus on the IT aspect of your company as well?
- How much of your budged would you separate for IT Spending?
- Does the nature of your work allow you to let other entities in at all?
- Do you work well with others when it comes to your own assets?
As a simple checklist/questionnaire this will serve you well for any upcoming decision making.
Let’s break everything down for a moment.
If you are facing infrastructural issues and they are occurring a lot more than you have anticipated they would, it may be a good indicator that you need help.
Continuing from this, if your IT Staff are dealing with these issues without any significant problems, then it’s probably fine. But if you do not possess an IT Staff or whoever is under your employment can not deal with the type of infrastructure that you own, then you might want to look for help from third parties.
If these issues have been getting in the way between you and your clients recently, that is one of the highest indicators that you need to consult with outside parties as well.
If you are getting help from third parties, calculate exactly how often and how much spend. Afterwards you can get a quote from MSP representatives and see if it is lower or higher than what you are paying right now.
Sometimes you also may simply not have enough time to focus on these types of issues if the industry your company is in is far more demanding. Getting help here would be a good choice, of course if you can spare a part of your budget for IT Related issues.
But most importantly of all is the contractual obligations you hold. If for some reason the work your company does is strictly prohibited to third parties, it’s best left to discuss alternatives. Although some MSPs are known to have high clearance in both the IT industry and probably in your region. You can always consult professionals on this matter.
After considering the previous checklist/questionnaire you can get a good idea if you need to work with Managed Service Providers and more importantly if you are ready for such an undertaking. It requires a good reason, a decent budget and willingness to adopt this different way of operation between you and the provider. Generally it comes down to what you lose in comparison to what you gain.
QUESTIONNAIRE: WHAT TO ASK THE MANAGED SERVICE PROVIDER?
The focus shouldn’t always be on you only, being prepared to ask the right questions will help you gauge if the MSP is serious and more importantly if they can provide exactly what you want.
Here the keyword is “exactly” because for this you will be paying a good sum of money and you want to make sure that your needs will be thoroughly met.
In order to get get a good grasp on what you need to ask, we have developed a quick questionnaire for you:
- What can you do that will enable us to be more productive?
- How exactly will you fix our issues? E.g What methods will you use?
- Are you okay with consulting with us first for every major change?
- How do your services pay off for us in the long term?
- Would you be able to integrate with us on a more private level?
- Do you have 24/7 Support?
- What can you do to prevent major business disruptions?
- With what major vendors do you work with that can enable us further?
- Tell us some of your previous success stories.
Having questions such as these will help you be prepared for that MSP interview. By knowing what to ask and when to ask it, you prove that you are ready and serious about this undertaking.
Managed Services can be a vital part of your next endeavor.
Whether it provides you with much needed stability or you simply want someone else to deal with that part of your business, the choice is yours.
Just before making any decisions, be sure to have a good understanding of all the implications beforehand as it may save you both time and money.
Overall, Managed Services are a good way to let third party experts deal with what you previously couldn’t. And if this is integrated correctly in to your grand plan, it will give you higher productivity and safety rates than ever before.
|MSP||Managed Service Provider|
|SMB||Small & Midsize Business|
|QOS||Quality Of Service|
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