Managed IT Service Providers–Additional Benefits:
Organizational Efficiency, Economic Benefits, Comprehensive Reporting, Control
A previous article described five advantages of managed IT services, among which were flexibility, less downtime, prevention—a proactive rather than reactive approach to IT operations, improved quality of both the IT network and customer service, and finally, the ability to close IT infrastructure gaps or inefficiencies gradually.
Five more potential advantages are considered in this article which include economic advantages, heightened specialized IT skills, and the ability to retain control over IT management, while taking advantage of specialization expertise provided by managed IT services.
1. Utilize skilled staff for difficult to manage operations
While in-staff IT might handle most routine IT operations, handling specialized tasks in-house might result in a drain on available resources. Managed IT services provides a cost-effective way to selectively obtain services of skilled staff in specialized areas, without having to hire a high-paid specialist or pay inflated overtime rates to staff. This services-as-needed approach saves time and energy, lowers company benefits costs, and keeps staff salaries at a reasonable level, while still being able to gain maximum benefit from heightened skills that are routinely available through Managed IT Services. This, then, increases network services, for both in-house IT, and potentially for the services offered to clients.
In the business management textbook Strategic Operations Management by Brown, Lamming, Bessant, and Jones, the authors endorse outsourcing “non-core areas of the business, which in turn will impact on operations management.” Additionally, in-house operations with an “organizational structure” that reflects “what the firm ‘does best’, often entailing outsourcing of other activities,” results in greater organizational efficiency, with obvious benefits in terms of quality and ROI. This has direct application to the advantages of Managed IT Services.
2. Lower overall cost
San Jose networking manufacturer Cisco Systems notes lowered costs accrued through managed IT services, citing statistics that indicate a 40% average cost reduction through managed services, with savings in specialized areas that can reduce costs by more than 400% compared to performing the same specific tasks in-house.
In terms of hardware, businesses can choose only the amount of storage and network capacity that is needed in a given time slot. Pay-as-you-grow rather than making a huge initial investment in costly networking equipment for what is not necessarily core services, allows companies to use capital for core operations and profit-making activities rather than on overhead. Overtime costs can also be reduced if not eliminated for specific applications; energy consumption is also reduced.
In a recent study, the non-profit IT industry association CompTIA provides evidence that 46% of managed IT services users accrued 25% or more in savings on annual IT costs, while 50% cut IT costs between 1% and 24%, as reported by MSPMentor. The major advantage of managed IT services is that it “free(s) up their own internal staff to work on revenue-generating projects,” states MSPMentor.
The best defense is a good offense—choosing a managing approach that allows staff to push forward rather than constantly cleaning up the rear, results in a forward-moving, progressive company that makes best use of available staff and resources.
3. Cost predictability and stability
The stability of a predictable monthly payment is another advantage of managed IT services. Rather than falling prey to high monthly cost surges due to server crashes or unexpected IT emergencies, a carefully chosen monthly services plan provides a stable, predictable monthly expense for pre-selected services that can be worked into the budget. Repair and service work is usually part of the contract, with the unexpected already built in. Lev S. Gonick, Vice President for Information Technology Services and CIO of Case Western Reserve University recommends a management strategy that provides “leverage in terms of predetermined discounts on products…and price predictability,” as reported in an article entitled “Doing More with Less: Obstacle or Opportunity for IT?” (EDUCAUSE Review. it added).
4. Comprehensive reporting leads to better-informed decision making
The separating of the weeds from the wheat in the field of Managed IT Services can often be accomplished by considering the level of reporting services provided. One of the major advantages of higher-level service providers, and what separates them from the pack, is high-level reporting, which leads to better-informed decision making. In choosing a managed IT services provider, high-level reporting should be a priority. NetWork World advises, “Require it [Managed IT Services] to provide extensive reporting as part of your managed services contract.”
Insight provided by comprehensive reporting provides valuable data that contributes to financially responsible decisions for the present and future in allocating IT budget and in establishing priorities.
5. Keep control over IT operations
While traditional outsourcing of IT operations may require turning over a large measure of the control over IT management to another company, Managed IT Services allows for choosing selected modules to be serviced, while still maintaining control over decision making and details, and with allowance for progressive flexibility in IT management. Outsourcing Center, an award winning information portal for all levels of outsourcing, states, “Fear of surrendering control is the main factor holding many IT directors back from outsourcing [any or all] IT services—but you can keep control if you select the right partner.” This is especially the case with Managed IT Services, where “outsourcing IT services does not mean all or nothing.” (Outsourcing Center).
References and Sources: