What are “Managed Services?”
Managed IT service is a company’s practice of outsourcing certain IT functions to a third-party provider that is referred to as a Managed Service Provider or MSP. These outsourced functions can range from keeping IT equipment and other services functional to full IT team outsourcing.
The goal of managed IT service is to either serve as an IT team for a company with little or no internal capabilities or to support an experienced IT team by taking some day-to-day tasks off their plate.
Why Do Managed Services Matter?
Workplace technology is rapidly changing and growing more complex each year.
One example is the number of devices employees depend on. 20 years ago, most employees only had access to work technology while at the office. Today, employees access company information in the office and on work laptops, tablets, or personal phones at home.
Some of these devices are being used without the IT department’s knowledge.
IT teams often have to develop ways to support each device and use cases while keeping company data secure. That’s just one way everyday IT work can quickly balloon to keep pace with workplace technology use.
Filling the Talent Gap
IT work is becoming more complex, but IT talent is not keeping up with the demand. Though the unemployment rate is the lowest since 2000, nearly 60% of employers struggle to fill job vacancies within 12 weeks. Experts predict that trend is going to worsen, putting the technology, media, and telecommunications industries short by 4.3 million skilled workers by 2030.
That means many companies won’t have the talent to support many critical IT services. Without someone managing upkeep and maintenance, business owners run the risk of cybersecurity breaches, data loss, and other issues that can negatively impact their businesses.
If you are lucky enough to have IT talent on your team, the last thing you want to do is alienate them or allow them to burn out on small tasks and maintenance issues.
Using an MSP allows your IT team to focus on strategic initiatives that support your business. Not only is that good for the bottom line; it also proves the value of your IT department and gives you a bargaining chip for future budget talks.
History of Managed Services
In the 1990s, networks were fairly simple systems. Since there weren’t many dedicated staff in IT departments, teams typically did not do anything for general maintenance if their machines were malfunctioning or slowing down — unless they stopped working. When these machines broke, technology teams would fix them. This became known as the break/fix method.
Thanks to downtime and loss of data and productivity, the break/fix method cost companies a significant revenue losses.
After a while, some Fortune 500 companies recognized the negative impact this mentality had on their businesses and began to work with IT service providers to proactively diagnose and correct problems before they created issues. This early version of IT outsourced service management used complex software to analyze data, which was cost prohibitive and unaccessible for most companies.
The Beginning of Widespread Usage
By the end of the decade, computers were more complex and most offices added other devices — like printers and fax machines — to their networks. Smaller companies began to realize the break/fix method no longer made sense. These companies needed to be proactive about monitoring and maintaining their equipment.
Putting that realization into practice was easier said than done, however.
Such proactive monitoring and maintenance put serious strains on limited IT staff and resources. So, by the late 1990s, more companies began using third party IT services to outsource some of their everyday IT needs including systems management, network monitoring, and security.
As demand for managed IT services grew, they became accessible and cost-efficient. Today 64% of organizations say they use some form of these services.
What Does the Future Hold?
As new technologies become common, the managed IT service industry expects to maintain a consistent growth.
We’re also seeing some trends for the future of IT including:
- Data and IT Security: We’re always hearing about data breaches and other cybersecurity issues. MSPs are responding to this need by offering more robust cybersecurity services to their customers.
- Specialization: While most MSPs will still offer generalized services, more providers will likely start focusing on specific industries. Becoming experts will allow MSPs to understand nuances and deliver a bigger value to their customers.
- The Internet of Things: The Internet of Things goes far beyond smart speakers in your home. This trend is skyrocketing in utilities, healthcare, the auto industry, and more. MSPs will need to keep pace with this growing trend.
Most Common Type of Services
The number and types of services a company needs from a MSP typically depends on the company’s internal IT capabilities. However, the most common services companies need support on are:
IT backup services protect and retain your data, allowing you to recover data as small as single files or as large as entire databases.
This layer of redundancy provides additional security and accessibility in case of an event. It is good practice to outsource secure data back-ups to take advantage of the state-of-the-art technology an MSP can offer.
Help Desk Solutions
Many companies who use managed IT services have little or no internal IT resources. MSPs often offer help desk solutions to give their customers access to an on-call IT specialist who helps them troubleshoot their issues either on-site or remotely.
IT Support Services
IT support services are especially useful when you need a combination of IT support and guidance. The MSP is responsible for proactively managing and patching your devices while providing insight into how your system works or should work.
Managed Network Security
This service helps free up your IT resources by outsourcing tasks like network intrusion detection and prevention, virus and spam eradication, content filtering, and traffic analysis through a traditional or next-generation firewall.
With so many companies adopting Microsoft’s popular cloud service, many MSPs are able to plan, design, implement, and support Office365 for their customers.
This type of data storage architecture allows customers to store unstructured data in large amounts. As businesses struggle to find ways to store such data, object storage can offer cost-effectiveness, scalability and reliability benefits. This storage type is typically used for data like media files, web content, documents, and backups.
General data storage comes in several tiers. The provider generally works with customers to find and use the type of storage that gives them optimal efficiency and the lowest cost.
This type of outsourced IT allows your MSP to monitor your servers, applications, and network. They’ll interpret the data and real-time metrics in order to proactively identify and solve issues before they cause downtime and impact your business.
Small and medium companies typically do not have the capacity to hire a dedicated Chief Information Officer. A Virtual CIO is a service some MSPs offer to provide analysis, strategy, and a step-by-step plan for the company’s technology.
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Type of Providers & Companies
Most managed service providers offer different service levels or customized packages depending on your company’s needs. With so many options to choose from, your company might wonder how to choose the right service provider for IT needs. Before you get started, it’s important to understand the common service levels that most MSPs offer.
This is a good option for a company with significant internal IT resources who wants to take some everyday tasks off their in-house team’s plate. In this role, the MSP focuses on monitoring and alerting the customer to proactively fix any problems with the company’s technology, but will not necessarily be involved in strategic IT work.
A consulting relationship works well for companies with some internal IT resources who still need strategic guidance for new projects or future growth. The MSP can perform all the functions outlined in the basic relationship but can also help the company with more strategic initiatives like creating a scale up plan.
An MSP that offers full outsourcing will have highly-trained staff who can offer a full spectrum of IT services with their own facilities and equipment. They will typically do everything basic and consulting MSPs offer while also offering higher-level strategic services like a virtual CIO.
Cloud Managed Service Provider
A cloud managed service provider offers many of the same benefits as traditional MSPs, but with a cloud management focus. While some companies focus solely on cloud services, many are able to offer both your traditional service offerings and cloud services in their packages.
Local Provider vs Big Box Provider
When customers decide they want to work with an MSP, many wonder if location matters when choosing a provider.
As you get started, you’ll have the option of choosing between a local provider like Tech-Ache Solutions & Consulting or a national provider like Amazon Web Services. Both have their pros and cons, so it’s important to understand what your company needs and values from the relationship before you choose.
Choosing a local provider doesn’t mean you’ll have to skimp on services or capabilities.
Many local MSPs have the infrastructure and technical expertise to rival a big box store. “Local” providers can actually have multiple locations (for example, Tech-Ache Solutions & Consulting has locations around the USA), can provide extended support hours, and can offer a robust service selection.
Tech-Ache Solutions & Consulting customers often choose us for the long-term relationship they get from a local provider.
That’s because local MSPs specialize in giving each customer individual care and focus. They can also provide specialized knowledge about your local market and, if you need on-site help, they can be there quickly.
Choosing Big Box
One benefit of a big box MSP is their tendency to have a global footprint. If you need to quickly scale up your business or replicate in multiple countries, these providers will have experience doing so.
Big box companies can also give you access to the latest technology. However, these companies are likely unable to provide the same level of customer care as local providers.
What Types of Businesses Use Managed IT Services
From small one-person startups to Fortune 500 companies, MSPs are valuable to all business types. Since most providers offer various service tiers, it’s easy for companies to find one that suits their IT needs.
Certain industries need to work with managed service providers who have experience in their target industry. MSPs who have industry knowledge will better understand how IT impacts business goals in industries like:
- Manufacturing and Distribution
- Master Franchises & Brand Companies
- Professional Services
- Real Estate
- Law Firms
- Financial Services & Accounting
- Insurance Firms
Challenges with Managed IT Services for Businesses
A lot of misconceptions exist when it comes to working with MSPs. We’ve broken down some of the most common myths we hear about managed service providers.
Myth: Working with an IT service provider will be too expensive.
Fact: Outsourcing IT tasks can actually be less expensive than hiring a new employee. Especially when you consider the service frees up your current IT team to work on more strategic projects that can positively impact your bottom line. Most providers will also offer tiers of service, so it’s possible to find one that fits your budget.
Myth: The MSP will be too controlling.
Fact: In any relationship with an MSP, the customer is the boss. Even if you engage the managed IT service provider as a virtual CIO, your company should always have the final say in any decision.
Myth: IT services should be handled by the in-house IT team.
Fact: A managed service provider acts as an extension of your in-house team. By taking some of the everyday tasks off your IT team’s plate, an MSP frees them up to do more strategic work.
Myth: My company is too small to work with an outsourced IT provider.
Fact: Small companies usually need a managed service provider more than larger companies. Small companies typically lack the capacity to manage these IT tasks in-house, leaving them vulnerable to costly downtime and cybersecurity breaches.
Working with an MSP can be a great business decision, but it can be challenging sometimes.
Sometimes customers might have different interpretations of what the company should provide or how it should be implemented. That’s because customers and providers often have different interpretations of words like “best practice” or whether management of networking gear starts with the initial setup or after everything is functional.
With multiple levels of services provided and multiple ways to interpret what each party is responsible for, it’s important for the customer and the MSP to be clear on what the agreement entails and what should fall outside of its scope.
As a customer, you should also look for a company that can offer expert staff, state-of-the-art technology, and preventative maintenance — not someone who only fixes things when they break.
How to Decide if you Need a Managed Service Company
You know your business needs services like IT support, backup, and other similar services, so is it time to engage with an expert IT provider?
Here’s what you should consider:
Size of your business
Almost all small and medium companies can benefit from using an MSP. These companies are already paying for many of these services, like anti-virus software and data backup, a la carte.
A third-party IT service provider can consolidate all these services, be proactive about fixing things before they break, and decrease your downtime.
The next question is whether you have the internal capacity to address these services. If the answer is yes, you should ask if managing these IT services is taking your team away from more focused, strategic IT initiatives.
Remember, you don’t want to waste your IT talent on minimal tasks and maintenance issues, but focus on solving IT management pains instead.
Your MSPs Offerings
As we mentioned before, MSPs range from basic IT support to total IT outsourcing. They may be a large national company or they may be a local company with great customer service. It’s important to evaluate your needs before you decide whether or not your company should work with a managed service provider. This will ensure you make the right decision and help you find the right provider if you choose to work with one.
Making the Business Case
Working with a managed IT services business is often less expensive than hiring new talent. It’s also typically a predictable, budgetable monthly recurring cost that can actually save your company time and money.
An MSP can also reduce your downtime, which is significantly cost-saving itself, considering the average downtime costs nearly $9,000 per minute.
Your MSP is proactively monitoring and managing your systems, which means they’re ready to solve any issues before they become an expensive problem for your company.
A Plan for the Future
Your MSP can provide guidance on how your IT should move forward while supporting your company’s bottom line.
Tech-Ache’s Solutions & Consulting Offering
Tech-Ache Solutions & Consulting managed IT service line will give your company the support it needs for everything from application hosting to a virtual CIO.
We structure our services to give you as much or as little support as you need, and we pride ourselves on being able to seamlessly integrate with your IT team.
A Local Provider
As a local provider, we offer enterprise-level solutions of a national provider with superior customer service, including 24/7/365 support.
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