Myths buster for managed services

Something is happening with Australia’s IT service and support companies. The ‘break-fix’ business is being sidelined by value-added resellers and IT integrators adopting a managed services approach to IT customer care. The outcome is stronger growth and higher returns, and customers benefiting from more robust network and technology services.

Yet some common myths about managed services may be holding back some technology support companies from taking advantage of this new approach. These myths need review.

Myth 1: By adopting another technology model, we lose control over our business

An effective managed service relationship provides a platform that keeps you in control and allows you to run your business the way you like to do things. You own your customers. You own the business. As a result your ‘ownership’ of the managed services software should be based on detailed service level agreements that meet your business needs. They should also be based around financial terms that work for you and your customers.

Myth 2: The cost savings provided by managed services are marginal compared to traditional break-fix operations

The business case for a managed service approach is compelling. By eliminating the need for on-site break-fix manual maintenance, the managed service provider (MSP) can save thousands of dollars annually in staff and overheads. Also saved is the non-billable travel and related downtime from callouts. An effective managed services model allows superior remote management of their customer systems individually or as one network. This means achieving more for your customers without employing more staff. Instead of a break-fix relationship, the MSP is able to provide customers with an enterprise-level IT service for less than the costs of managing IT needs in house.

Myth 3: Our customers will feel they are getting less time from us, hence less service

An MSP approach to technology customer service is an approach that focuses on tasks and outcomes rather than the time taken to perform break-fix work. Customers gain a more robust IT infrastructure with managed services. They shift their focus from the time it takes to fix problems to the increased productivity gained through less IT downtime, higher reliability and less disruption to their operations. An MSP approach to service delivery creates more controls over a customer’s technology support spend. There is less volatility. But higher levels of confidence.

Myth 4: Managed services for technology support is not widely recognised

In Australia, the market for MSP is growing. Market research firm Frost & Sullivan predicts a 20% annual growth in this sector through to 2013. While this trend covers a variety of sectors, there is little doubt that the benefits of a managed service approach to technology support are driving demand among SMEs and enterprise-level customers.

Myth 5: You pay a lot for a managed service application

Costs for a managed services application can be recouped reasonably quickly. For a small business with a few staff, becoming an MSP provides a break-fix business with the capacity to generate higher returns from a stronger suite of services. The business also gains from improved staff utilisation and stronger business competitiveness. In addition to higher returns, the business gains from stronger customer loyalty and reduced overheads, and provides a high-quality and prompt service to customers. It also provides the capacity to take on more customers without the need to increase staff. The net result is a business generating higher returns.

*Tim Dickinson is regional manager – Australia and New Zealand for Kaseya.

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