With the increasing level of noise singing the praises of managed services as the future, it may be worth taking some time to consider how a fundamental shift in the way IT is provisioned may impact a business in reality. Under the right circumstances, managed services can be a blessing that leads to improvements in functionality and performance, mitigation of risk and reduction of the total cost of ownership. However, the path to enlightenment has many pitfalls. Here are a few of the big ones to watch out for.
A single point of contact can offload the guesswork, simplify the process and save valuable time in the event of technical issues. Conversely poor service can become a single point of failure, leaving you at the mercy of your provider. Providers might promise the world in order to get you into bed, yet over time commitment can end up very one sided. Ensure that the terms and conditions of services proposed are reasonable and appropriate to your anticipated needs, and that expected service levels are contractually agreed. This will allow room to maneuver and avoid the ‘honeymoon period’ scenario.
Factors such as the savvier buyer and diluted marketplace have seen the profit margins on hardware in steady decline since the industry’s ‘boom’ period in the early ‘90s. Traditional resellers are now engaged in a race to ‘land grab’ as much contract business and recurring revenue possible ahead of the competition.
There’s been a lot of talk recently about the commoditization of information technology in business. Be it for software (or x) as a service, hosted solutions or anything flying under the ‘cloud’ banner, a huge amount or marketing money has been pumped into the industry in recent months. While managed services, like any other IT service on demand can offer some persuasive benefits, take care to decide whether a potential provider truly understands how managed services will work for your business, and not simply over indulged on vendor hype.
The ugly truth is that many managed IT service providers actually profit from their client’s misfortune. This is especially true where they charge for their services by the hour. An agreement based upon a flat monthly fee will help ensure problem avoidance remains mutually beneficial.
It is incredibly difficult for a client to quantify, validate and benchmark work completed in return for the price demanded. Frequently, businesses pay to rectify problems that could have easily been avoided with a little proactive attention. Look for a provider who will actively monitor your systems in search of problems that otherwise left untreated may result in disruption.
If you suspect a managed service arrangement will make financial sense, don’t wait until problems occur before seeking advice. Allow yourself time to fully research options, compare value of competing providers and consider all scenarios you’re likely to face. It is all too easy to sign a contract based on your immediate needs, especially when you’re recovering from a bad experience your back is against the wall.
One of the main advantages of any form of commoditized IT service is the ability to dynamically adapt in order to meet the changing needs of the business. This includes service provider. In reality this benefit can quickly become an illusion. Take care to ensure a provider will give you full and up-to date documentation of your infrastructure, detailing everything an alternative provider would need to assume responsibility should the need arise. Such measures will help safeguard against offloading control, not just the responsibility.
Building on trust, your relationship will involve sharing access to intellectually property, potentially sensitive business information and operating procedure. It is extremely advisable to sign a mutual confidentiality/non-disclosure agreement when you begin talking. With the best of intentions, providers may wish to promote their relationship with you to the world in order to build credibility and attract new clients. It is important to consider precisely what and how much you want your competitors and stakeholders to know.
In summary, it is vital to understand the terms of engagement and what you’re really getting into when considering a relationship with a managed service provider. You must trust that a provider will act in the best interests of your business. A good provider should bring clear value and bear the responsibility for your business systems, not the control.