Nowadays, business and IT are tightly coupled. The company faces changes and competition that rely heavily on technology to support daily business operations and growth. To some extent, the business can’t accept the risk and can’t afford IT system disruption or downtime costs. Therefore, IT system availability and service quality become significantly critical. Companies need more than the on-call or ad-hoc ‘break/fix’ model to meet such expectations.
In-House vs. Managed Service
Generally, a company buys software, installs it on the server, connects to the network, and accesses it thru the intranet or Internet. For daily software support, the company may hire an inhouse IT team. Alternatively, the company can outsource the tasks to a managed services provider (team of trusted IT experts) with an IT service level agreement bound.
Let’s take another example where a company may require workstations for employees in geographically widely spread branches. Having in-house IT field support will not be effective and efficient compared to working with a nationally operated managed services company for seat management. Moreover, IT security, data center, network, application support, help desk, and many more areas are the potential for managed services.
The main differentiation between in-house vs. managed services would be:
•The availability of resources in the pool,
•The expert team in the required IT domains,
To some extent, the business can’t accept the risk and can’t afford IT system disruption or downtime costs
•The just-in-time resources with less overhead,
•The best practice working methodology in place from day 1, and
•The benefit gained from economies of scale. These propositions allow the managed services provider to deliver competitively with the agreed IT service level and quality.
The As-a-Service + Managed Service
In today’s era of cloud computing, a company may subscribe to a software-as-a-service (SaaS) instead of build-and-operate. It may significantly reduce the complexity of managing the required IT resources. Many softwares are available as-a-service in the cloud, varying from email, collaboration tools, service desk tools, CRM, ERP, HR, etc. Beyond software, some platforms and infrastructures are getting commoditized and becoming available competitively as-a-service due to the economies of scale. Such an as-a-service model replaces the hassle of IT maintenance and reduces the in-house IT complexity. Meanwhile, the company has the IT service level guarantee by the service provider.
To avoid confusion, managed services are beyond and may sit on top of the as-a-service model. For example, a company may subscribe to email SaaS with zero hassle in managing the required email server, software, and network. On top of it (beyond the scope of SaaS), some tasks may be transferred to a managed services provider, such as email account setup/archive/deletion, troubleshooting, help desk, etc.
The same case and scenario apply to most generic, standardized, and commoditized IT services. E.g., seat management with workstation requirements for the operating system, antivirus, productivity tools, and collaboration tools. The software may either use SaaS, standalone software, etc. The agreement may cover IT SLA for fixing and unit replacement for the workstation hardware.
Moving forward, the companies would hardly invest in all required expert resources to keep the complex IT system availability and service quality due to the broad IT domains and the number of IT personnel needed; to some extent (depending on the company size), it would not be viable due to the economies of scale.
Therefore, to meet the criteria of IT service level, quality, cost, and benefits, the managed services may provide significant benefits to the business. In combination with the as-a-service model, managed services may boost IT efficiency, agility, and resiliency. Therefore, the in-house IT team may focus more on delivering strategic and higher value propositions to the business.