Read any article on computing or technology and you’re likely to see the words “Managed Services” scattered throughout. It seems everyone is using the term, but no one is really defining it. The technology industry is always coming up with new terms just about the time everyone has learned the last set of buzzwords.
Many resellers and network service providers are using the terminology as well. Maybe you’ve heard this already from your technology vendors. If you haven’t, we think you’ll be hearing it sooner rather than later.
What Is Managed Service for IT?
So, what is “Managed Service?” In its simplest form, it’s exactly as the term implies. You arrange for someone else to provide a service that needs to be performed for the successful operation of your business. One could make the argument that janitorial or lawn care services are a type of “managed service.” Closer to home, in the technology field, you will find printer cartridge vendors using the term to differentiate themselves from their competition.
The key element often missing in these examples is management. It’s one thing to provide a service. It’s quite another to take over the management functions in regard to that service.
In this article we will clarify what “Managed IT Services” means to us and provide you with the information you need to make a decision about whether or not it’s something that fits into your business. Specifically, we’re going to examine how this term applies to your computer network and IT infrastructure.
How Do You View Managed Service?
The small-to-medium businesses and enterprise businesses typically look at managed services differently (and they should.) Gartner, the world’s leading IT research and advisory company, has stated that the average costs associated with a workstation in a large organization is between $5,000-10,000 annually. Included in those estimates are IT personnel, hardware, software, energy costs, required upgrades, outside consulting services and employee training. Most small-to-medium businesses would never consider a budget that large for a single workstation, in some cases this could be the budget for their entire technology infrastructure.
Why does this disparity exist? The main reason is that in larger organizations there are more variables to consider. There are more switches, routers, patch panels, power supplies, software packages and tools, operating systems and other hardware. Most large organizations have planned replacement schedules for these items. They can’t wait for something to become inoperable before they replace it. They’ve learned that planning for replacement saves downtime and the corresponding costs.
Enterprise organizations have been using tools to help manage their networks for years. Perhaps you’ve seen pictures of the NASA-looking rooms with flat-screen monitors everywhere. Also, larger organizations often implement a more strict usage and security policy for their users, locking down workstations to limit the amount of variables and the resulting problems. They plan updates and patches for the least amount of interruption. They rotate workstations on a set schedule. They plan operating system and productivity tool upgrades. They replace key infrastructure components like routers and switches on a regular basis.
A Gartner study showed that the more workstations/users were managed this way, the more savings was accumulated. A slightly managed environment saved 10% compared to the highly managed at 42%. As a leading Managed IT Service Provider in Waukesha, ToSolution is committed to providing the most savings possible to our clients. (source: http://www.gartner.com/newsroom/id/636308)
Most organizations with less than 50 users can’t afford to hire a qualified network engineer proficient in all aspects of network administration. It’s also unlikely they are going to replace a desktop computer every 4 years if it’s still working. Similarly, they don’t need database administrators or three levels of help desk personnel. So, how does this enterprise model apply to the small-to-medium business environment?
Many small businesses are surprised when they are told that their ‘little’ network of 10 or 20 users has thousands of moving parts. When an objective look is taken at all of the pieces that have to work together to keep a network operating, it’s difficult to comprehend how it all works. There is operating system coding, switch ports, routers, security components for intrusion and malware/spyware/virus protection, cables, backup software and media, productivity tools like Office, plus all notebooks, desktops and printers have software applications that have to fit together for a smooth running network. Servers have even more sophisticated operating systems and hardware components.
For most small-to-medium businesses this can be a foreign world. They want to concentrate on their business and not worry about their technology needs. The usual scenario is that they find a technology company they can trust, allow them to make recommendations but only call them when something isn’t working. The small-to-medium business may not know why something is wrong – just that it isn’t working the way it was. Sometimes the user themselves may find a workaround to a computer problem. Depending on the circumstance this could save money in the short run because of a saved time-and-material service call. Other times this do-it-yourself method could create unseen problems in other areas costing more time and money down the road to fix the issue correctly.
Some technology companies, servicing the small-to-medium business arena, have begun the move to a more proactive, managed approach. Generally, a client connects with a Managed Service Provider (MSP) on a flat rate IT support contract. For that fee (usually monthly), the MSP manages the client’s network infrastructure. The small business owner now knows what his network support costs will be on a monthly/annual basis. In a way, it’s like the small business is hiring a full time network administrator to make sure nothing is going wrong with their network at a severely reduced cost of a full-time administrator.
But what does the business get for that flat rate? What does ‘managing network infrastructure’ mean?
Within the last couple of years, software products that have many of the same capabilities used in the aforementioned NASA-looking network centers have become more available and much more affordable. These software products give an MSP the ability to monitor almost all aspects of their clients’ network infrastructure remotely. Some of these software products can monitor more aspects of a network than others. Like most things, it’s a ‘get what you pay for’ marketplace.
Why is this important? All computer equipment and software is in a constant state of degradation. From the moment something is installed it begins to work less efficiently. A common example is the disk drive. A disk drive generates errors from the moment it is installed and powered up. Dozens of errors are generated daily. Many of these are corrected by the operating system but over time the amount of these errors increase. A disk drive doesn’t suddenly die. It degrades to the point that it eventually becomes inoperable and crashes. A good monitoring program will notify of these errors increasing so that a drive could be replaced proactively avoiding business interruption. This is a straightforward example but it remains a common real-world challenge.
A good monitoring system can watch thousands of aspects of a network, catching problems when they’re still minor and making the necessary corrections. Making these corrections saves time and money by preventing problems as simple as not being able to print, or the server running slowly, to more devastating issues like system crashes.
Another key aspect to a proactive, or managed approach is the ability to keep a system running efficiently. By monitoring key performance elements – such as memory usage and processes, processor performance and bandwidth – and making the appropriate changes when needed, a Managed Service Provider can keep a network running smoothly and proficiently. Some management programs are able to automatically apply updates and patches and schedule defrags to run regularly keeping servers, routers and workstations clean and current. This reduces diagnostic time for a technology vendor when problems do occur. In the old break-fix model most of the time spent on a service call was spent finding and diagnosing the issue. In some cases hours would be spent identifying an issue before any action was taken to resolve the issue.
Some Managed Service Providers offer help desk services for their clients as well. They have a business model with personnel monitoring multiple clients from a desk of displays. They’re repairing minor problems and fielding calls from users as well as watching for more drastic problems. This business model helps solve an issue that technology vendors have struggled with for years. Many small businesses only call their vendor when they have a problem. If the vendor has the clients best interest in mind, they’re going to diagnose the issue, fix it and get out. They’re trying to keep the billing hours to a minimum. Maybe they’ll suggest that the server could use some routine maintenance. But that question can be viewed negatively by the client as trying to run up the bill. So, a service provider sometimes treads lightly when they ask, even if they know some maintenance is important. Under most Managed Service contracts this maintenance is included.
By now you might be saying this all sounds great, but what does it cost? Managed Service Providers offer a variety of packages. Some cover servers only while others cover everything all the way down to mobile phone support. Some may not provide any software patching support or won’t offer help desk services while others will cover one or both services. Comparing services is important just as it would be with any type of services contract. Making sure you understand what is covered and what isn’t will eliminate surprises later. One important item to watch for in contracting for flat rate Managed IT Services is the type of reporting the MSP offers. Are they documenting the work they’re doing and is that documentation available to you? It is one thing for them to state they’re doing maintenance; it’s another to provide some type of proof of the work that’s been performed. Because technology is always advancing, its critical to partner with an MSP that not only monitors your system day-to-day but helps you plan for the future. ToSolution provides this service to our ProVision customers via an Annual Assement.
In most cases, annual cost outlays for a small-to-medium sized business don’t change that much under Managed Services. Where you will save, is by having users and a network with fewer problems and more efficiency. You will also have more peace-of-mind knowing that someone trained in network administration is monitoring your network all the time. Another advantage, if your MSP offers a help desk, is that there is always someone available when you call. Instead of waiting for hours for a problem to be resolved, many times it can be taken care of in a few minutes translating to better response times and less downtime.
Managed Services is something that could help many small organizations save time and money. The software products have matured to the point that this is a viable business option for many organizations, and some are taking advantage of it. If you are interested in learning more contact us anytime.
About the Author: Tim O’Neil is President and co-founder of To Solution, Inc., an information technology managed service provider based in Waukesha, Wisconsin. Visit https://tosolution.com/blog to read more of Tim’s blogs or connect on LinkedIn at linkedin.com/in/oneiltim