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New Trends In Managed Services: P Is For Profitability

We’ve all seen the benefits of managed IT services. But have you ever wondered if there’s a better way to grow you business from the inside out?

Many CFOs are approaching 2015 with a deep focus on culling out areas within their core businesses to pinpoint new sources of revenue. Ones that have been overlooked for years and yet can add profits with minimal investment. However, what many executives don’t look are ways to increase profits by maximizing manpower and IT costs.

Often when we speak with an organization interested in learning how can help them migrate their systems to our managed services, there’s usually one question that comes up. How do we protect our existing network and technical infrastructure while also growing our business?

We recommend taking a critical look at your line-item expenses. But not merely by evaluating your costs with your accounting department. What’s common with most sized companies is something we call detachment. Here’s how it goes…

IT technicians spend nearly 75% of their time fixing and repairing internal technology to support your users.

Accounting reports to the CFO on what types of fixed-costs are required to keep your organization afloat. Besides payroll and facility costs, technology typically trails at a distant third.

Users and service personnel spend much of their work week processing profit-generating tasks.

Middle-management supports your workforce while also answering to senior managers to report on whether projections will be met.

What’s missing? It’s almost always an in-house assessment whether your current in-house IT department can decrease costs while also increasing production. Granted, your company can only grow at a pace your manpower can support. But what we find unique in many cases when speaking with companies looking to outsource is they usually don’t know what their true IT costs are at any given moment.

Why should they? Based on our research,

A large percentage of organizations have little to no hard data on the cost of running their IT.

Is this shocking? Yes and no.

Obviously, not fully understanding the financial impact maintaining your networks and servers have on your profitability will make you wonder if you’re overpaying. But honestly, most companies are so busy operating their core businesses they do not have the resources or time to pinpoint IT expenses.

If you’re wondering about your own internal IT costs, the next question to ask yourself is whether or not a hybrid approach may fit your organization.

Hybrids come in all shapes and sizes. Perhaps you’re ready to implement a public or private cloud network but don’t quite know if it’s financially prudent. Oftentimes hybrid scenarios can prove far more profitable. Meaning you may not need to outsource all of your technology needs but do need help to maximize ones that are falling behind in performance.

One size fits all thinking when considering a MSP solution never works. In fact, you’d better do a full-scale analysis of your networks, users and frequency of downtime. Remember, when your networks are down production always suffers and impacts your profitability.

Study Shows Customer Education Necessary to Managed Services Growth

surveyAs the use of managed IT services continues to invade every area of business, it’s important to closely monitor customer response. Since the practice is so new, both businesses and providers can learn from each success and failure, putting the information to use in future deployments.

A new study from IT industry association CompTIA found a high level of satisfaction among those who have adopted managed services. Yet slow growth in the sector indicates many customers fail to understand the many benefits. Only three in ten organizations have moved to managed services for their IT needs, despite its many benefits. Even gathering that information is challenging, however, since many customers are still unclear about the meaning of “managed services.”

The Realities

Results from survey participants who are using managed IT services show the cited benefits are real. 57 percent of those using managed IT services stated that cost savings was the top reason they chose these services. Many also mentioned that partnering with a talented provider means they’ll have access to new technologies as they become available.

Overall, the responses proved that once customers make the choice to go toward managed IT services, they’re happy with the results. The challenge is that many managers and business owners aren’t aware of the many features available with managed IT services. In fact, CompTIA’s report shows that many respondents are unable to differentiate between in-house IT services and those that would be facilitated by an outside services provider.

By continuing to get the word out about the many benefits of using managed IT services, providers can help businesses strengthen their technology usage without straining their budgets. Managed IT services often are more affordable and provide greater security and functionality than in-house IT departments, but it will take time for businesses across all industries to fully comprehend the difference.

Latest Trends in IT Managed Services

Your company’s arrangement with its janitorial service or break-room supplier may not have changed much in the past 20 years, but chances are you’re looking for something much different from your IT managed services provider than you did even a year or two ago. And if you’re not, maybe you should be.

Here, then, are four important trends in IT managed services that you may want to consider.

1. BYOD. You’re probably heard the acronym for “bring your own device” before, but if you haven’t talked with your IT company about it, it’s about time. If your workers are using company email or accessing your network on their iPads and smartphones, you need to know how to keep confidential data safe, and how to make the most effective use of the amazing technology that we all carry in our pockets these days.

2. The Cloud. This is another term that’s been on most of our radar screens for a few years now. Yet when it comes to one of the most obvious uses of the cloud, offsite data backup, only 33 percent of small businesses have signed on, according to a 2012 survey. Managed Services providers should be able to explain which cloud functions you might want and help you manage them efficiently and securely.

3. Managed Print Services. The paperless office is a nice idea, but most businesses still have a significant need to print materials, whether for internal or external uses. Managed print services can unify and streamline printing, help reduce costs, and give telecommuters access to secure printers. That might explain why the number of total printers managed by MSPs jumped from 86,000 to 107,000 over the past year alone.

4. Thought Leadership. IT companies once functioned something like plumbers—they were someone you called to fix problems and then go away. Now, businesses’ IT strategies are becoming a big part of their overall strategies. A good MSP can become an insider that understands your company and finds new ways to make it work better from top to bottom through technological innovation.

It’s possible all these trends may not be relevant to your business, but there’s a very good chance that at least some of them are. If you’re not sure how, you might try setting up a meeting with your managed services provider to ask some questions.

Managed IT Services vs. Cloud Services Provider

Shopping for IT services can be tricky. The whole point is finding a professional firm that has more technical expertise than you do. But without all that specialized knowledge, it’s hard to know whether a service will deliver what your office needs. Things get even trickier when you start comparing providers who may be using different terms to describe very similar services.

One case in point is the term Managed IT Services, or Managed Services Provider (MSP), versus Cloud Services Provider (CSP). Some firms just call themselves MSPs or CSPs, while others may list both terms in their marketing material.

So, what’s the difference? MSPs handle all sorts of IT functions, from setting up a new network to troubleshooting an iPad that’s started acting strange. As more and more businesses are bringing some of their IT to the cloud—whether just for backup or email hosting or for their whole network infrastructure—some see CSPs as the wave of the future. Essentially, CSPs handle a company’s IT needs in the cloud. In many cases, that means they partner with one or more big cloud providers, figure out which services you can use, create a custom package for you and then keep it functioning smoothly.

Of course, even if everything is great in the cloud, you could still run into problems back in the office if an employee spills a mug full of coffee on his laptop. In many cases, what businesses need is some combination of MSP and CSP. And the good news is, that’s also what many IT firms offer. The bad news? The nature of their offerings isn’t always clear from their website or initial sales pitch. That’s why it’s important to have specific questions ready about the services they offer and the way they fit in with your business’s ways of operating.

Ultimately, you don’t have to be an IT expert to hire an IT expert. You just have to know what your company needs.

Managed IT Services Pricing: Are You Overpaying?

With companies more dependent than ever on complex networks, mobile devices and electronic solutions for everything from bookkeeping to compliance, managed IT services are looking increasingly attractive. But choosing a provider can be an exercise in comparing apples and oranges. Some managed IT services companies set their prices based purely on how many devices you use. Others let you pick and choose from a variety of services on an a la carte basis. And still others have a tiered system where “gold” level clients get quicker service and more total hours of support than their “bronze” counterparts.

The key to choosing wisely is that there’s no one perfect managed IT services package. What you need is the best package for your business. And that means you need to have a clear idea of your specific needs going into the process. How many networks do you use? If your IT is hosted on site, do you want to move it to the cloud, and, if so, how will the transition and continuing network management fit into your overall plans? Do you have employees who work from home, or who use mobile devices on the road?

If you take a look at your use of IT service over the past few months, you can probably get a sense of your needs. How many tickets have come in from employees, and what issues did they reflect? Do you need frequent hands-on help at your office, or can remote assistance typically handle the problem?

It’s also a good idea to go through worst-case scenarios. If your network suddenly went down on a Sunday at 4 p.m., would it be an emergency that had to be handled immediately or a minor inconvenience that could wait until Monday morning? If one of your field reps working on the other side of the country couldn’t get help logging a new phone onto your network, how bad would that be?

There’s a reason people say time is money. If a long wait time for help from your managed IT services provider would keep your workers twiddling their thumbs, that’s just as much of a problem as overpaying for services you don’t need.

Of course, what you really want is to avoid both those problems. So before you go shopping for managed IT services, make sure you know just what your needs really are.

Using Managed IT Services for Savings

We all know that you get what you pay for, right? You can’t expect to pay rock bottom wages and get the best employees, or spend next to nothing for a great office space.

When it comes to technology, though, things are different. Some companies are still using old-fashioned software at a big up-front cost, and paying big money for professionals to set up new computers and troubleshoot their networks. But forward-thinking businesses can cut out much of this expense with new managed IT services offerings.

Thanks to cloud technology, many companies can get the latest software, the precise amount of storage they need, and all the back-up and compliance services they want, for less than they might have paid for a much less sophisticated system a few years ago. For example, Office365 and other providers now provide Exchange email hosting in the cloud for as little as $4 a month. That means getting your email out of you on-site server, eliminating the need to have an IT consultant fix any problems it might develop.

Another excellent value you can find with managed IT services is a fixed monthly fee that covers the maintenance of all your on-site systems. Beware of contracts with an added fee to address problems that occur—for a flat fee, an IT company should keep things from breaking and also fix any problems it fails to prevent.

Of course, sometimes you need extra services, whether it’s redoing your phone system or setting up network connections for new employees. Most managed IT services companies will let you pre-purchase blocks of hours at a better rate than you can get by calling the company out of the blue.

The options available with modern managed IT services can be complicated, but if you pay attention to your alternatives you can often find ways to get better service for less money. And that’s certainly more than you can say for just about any other business expense.