IT Managed Services: Preventing it from becoming mid-90’s ‘Outsourcing’

This article is for those contemplating a Managed Services engagement to address all the repetitive IT headaches that take time away from strategic planning efforts. You have realized that you don’t want to use your highly-compensated IT staff to check backups, restart services or fight the myriad of fires that pop up every day. There are, however, some old ideas that need to be shed to help ensure success.

1. Named Resources

This is one of the most dangerous ideas.

“I want to know who I am dealing with!”

No, actually, you don’t.

If you have come to the conclusion that Managed Services will enhance your IT group, only the SERVICE matters. If the service is provided successfully, maintains the environment and deals with issues that arise, it shouldn’t matter if it’s being performed by lawn gnomes.

Requiring dedicated named resources removes one element of efficiency in that the resource becomes basically a replacement for a full-time employee.

The enhanced financial efficiency and technical superiority of Managed Services comes partly from the fact that it’s a shared service.

As long as end-user satisfaction stays high and all SLA figures are met, a shared service is actually a benefit. A named resource is only exposed to your issues. A shared group of qualified professionals is exposed to the issues that arise in tens, hundreds or even thousands of enterprises. This kind of technical proficiency cannot be taught.

2. The ‘Price Shopper’

Long-time technicians are all familiar with the phrase ‘Buy cheap, buy twice.’ To some extent, this applies to services too. I’m not saying that spending more than necessary is a good thing, but spending less than necessary is most definitely a bad thing.

Many of the ‘Big Box’ outsourcers have re-branded themselves as managed service providers with no real change in operating procedures. This gives them a very attractive price point. In order to maintain profitability at this price point, however, rigid, inflexible adherence to the pattern of services delivered across all their customers is paramount.

If you’re shopping for price, don’t  expect a solution that fits your business. Expect, instead, to modify your business to suit the service model.

3. Leveraging

Get some project work done without bringing on additional resources. Sounds like a great idea.

It’s not.

Managed services are designed to address repetitive but necessary support functions within an environment. Each time a project is injected into the mix, the support pattern is disrupted.

The efficiency and effectiveness of Managed Services arises mainly out of well planned, well managed and well tracked repetitive procedures.

Your Managed Service Provider will be more than happy to assign you a project resource if you really need one, and probably at a fair price. Avoid disrupting the support matrix by insisting on the ability to leverage.

4. “Get your boss!”

In the outsourcing days, often a problem arose that required escalation to a higher level of management. Once we got that person’s name and number, we often found it a time saver to go directly to this party to resolve all future issues. Senior management had the clout to issue ‘Do it now!’ orders.

Things have changed. If you have an on-site or remote Service Delivery Manager, that will be the resolution point for most issues. If you don’t have an SDM, you will have been provided with contacts intended to smooth any support turbulence that may arise.

“Do it now!” has another meaning: “Stop what you are doing”.

Going directly to a higher level can have serious impact on support. A senior manager will generally act quickly when advised of a problem. This quick action precludes in-depth analysis of the ripple effect that such a disturbance may have upon an otherwise well-ordered support structure.

I don’t mean to imply that you should never address an issue to a higher level of management. Just do it only when necessary.

5. Staff Replacement

Outsourcing was based on the notion that replacing our internal IT staff with a contracted staff would save us countless dollars. I guess we saw how that worked out…

Managed Services: NOT a staff replacement.

Managed Service Providers take away the redundant operations that keep your existing staff from reaching their potential as contributors to company profitability.

Since it is genuinely a service, and not a staff replacement, it is usually priced very attractively. Combined with the increase in effectiveness and productivity of your internal staff, you realize a net gain to your company.

 In Conclusion….

IT Managed Services are a great way to enhance your organization’s business model by removing all the repetitive but critical activities that become an overwhelming source of ‘background noise’ that prevents you from bringing real strategic change and value.

If we’re not careful, however, in both planning and execution of Managed Services implementation, we could miss out on the benefits and find ourselves stuck in the 90’s. Please keep these five points in mind as you proceed.