Many lessons can be learned from the events surrounding the COVID-19 crisis. Few could have imagined the profound impact it would have on daily life. Even simple events, like going to the store or watching a soccer game, became impossible.
These events require that business leaders review operations and take the necessary steps to mitigate risk. To prepare for future, businesses need to recognize that what worked in the past may not work in the future. New challenges, like a global pandemic, require business leaders embrace new solutions.
For many businesses, managed services deliver solutions that not only address these challenges, but also offer additional advantages.
What are Managed Services?
With managed services, a business will outsource a service to an outside provider. For example, with IT (Information Technology) managed services, the business will pay for an outside company to manage IT services. Typically, a minimal service state will be defined in the agreement between the business and the provider, and the provider will ensure the service state is maintained. Additional criteria, like performance metrics, may also be defined in the agreement.
IT is only one type of managed services. Other managed services agreements may cover HR and payroll, security, print services, communication, and support services. Today, one of the fastest growing areas for managed services is Managed Software-as-a-service, with a provider delivering and maintaining a software system for a business. This could include service, updates and support.
Why Managed Services are Critical for Leading Businesses
There are many reasons why a company will turn to managed services. In the past, many businesses looked at managed services as a convenience. Rather than hiring and training an IT staff, the company could pay for IT resources when they needed it. The company could hire new employees and set up a new division, but it was easier just to hire another company.
Recent world events have many companies rethinking how they maintain critical operations and continue to deliver services to customers. Supply chain disruption, the need for non-essential employees to work from home, lost or unavailable resources, and business closures in the industry have put pressure on company leaders to find new solutions to basic operations.
Many times, those solutions aren’t readily apparent. Leaders don’t have the data necessary to make the right decision, or don’t have the supplier or industry knowledge to deliver the best possible solution. Even worse, to meet the immediate needs of the business, resources are pulled from more profitable projects to fill a gap. This creates inefficiency, increases costs and expenses, and leads to problems that can quickly spiral out of control.
With the world growing more complex and greater demands on business and business leaders, engaging a managed service provider (MSP) is more than convenience – it’s strategic.
Consider the following advantages, especially in light of recent world events.
Back-up or Contingency Operations
If a supplier goes down, ceases operations, or can’t fill your order, do you have a contingency in place? What about a back-up plan for business operations? What will happen if an office needs to close, or you have a team that goes on sick leave for an extended period? Can the rest of the office cover? How will this impact your customers?
Now more than ever, businesses need to plan for contingencies. Leaders need to look at not only how to improve operations, but how to cover gaps when a crisis occurs. For businesses, an MSP not only provides a back-up plan the company can count on, but they offer flexibility and additional resources when needed.
Using a managed service provider for critical supplies means accessing the resources of an international network of vendors, rather than relying on a single “preferred” supplier. Working with a managed services provider for marketing or communications means you have a partner who knows your business with the resources on hand to cover gaps without impacting existing operations. You have the assets and expertise to meet any challenge.
Price and Expense Control
During a crisis, prices can quickly skyrocket. As resources are stretched thin and the supply chain cracks, costs can fluctuate, especially if you operate in a narrow market. This happens not only for supplies, but also expertise and outside resources.
Utilizing a managed service provider gives you a measure of protection against cost escalation. With a wide supplier network and inside industry information, the MSP can operate ahead of problems to provide your business with stability. Likewise, when critical expertise is in short supply and there is a waiting list for specialty service, the business using an MSP can jump to the front of the line.
Many companies cite the lower cost of managed services as one of the primary benefits. Hiring and developing internal resources can be expensive and reaching out to individual suppliers can leave you with an incomplete view of current market prices. By utilizing the resources of an MSP, you can reduce overall costs while enjoying superior service and ready access to more resources.
Provide Solutions for Better Efficiency
Most providers will start engagement with a business by conducting an assessment. The goal of the assessment is to identify current problems and inefficiencies and develop solutions that better meet business goals.
Many times, that additional efficiency starts with allowing employees to focus on their core competencies. Rather than forcing office managers and business leaders to handle the ordering and inventory, the MSP can handle it so they can focus on higher-priority items. Developers can focus on customer work, rather than software updates, training or IT issues.
Additionally, the MSP can provide resources for the business to cover gaps. Rather than spending time reaching out to local printers for a project, the provider can handle a print job quickly, efficiently and for a lower cost. In the end, the provider can deliver more efficiencies than the business can implement alone.
Setting Performance Metrics
Many businesses struggle with a gap between business goals and business operation. Departments aren’t aligned with the overall company goals, and instead work in a silo – almost like a separate business. The metrics used by the individual departments reflect this disconnect.
The key to meeting your goals are metrics. Metrics are a way to measure business results. By identifying metrics tied to growth, you can measure the success of your results, and flag efforts and processes that aren’t delivering the results you need.
When you set up a service agreement with a managed services provider, you can set metrics with the MSP, linking them to your business goals. Use the provider to give you a leg up on meeting your goals, or to solve a problem or challenge holding your business back.
Many businesses facing current challenges in this crisis are seeing weaknesses in operations. Engaging with an MSP and identifying critical metrics can provide a ready solution for the company.
Critical Performance Data
Many companies are still struggling to collect and use data. Employees use dated processes that have no framework or method for capturing data. Managers may not even know what to do with the data because the company never set benchmarks.
The result is lost opportunity. Managers and business leaders aren’t even sure where to begin with a data collection initiative.
An MSP is in the business of process improvement, which means having a system in place for collecting, displaying and using data. As an industry leader working with other businesses, the provider has the benchmarks and comparable work to accurately assess data. They can provide an evaluation to identify opportunities for improvement and savings. They can see where there may be weakness in current operations.
With accurate data on-hand, business leaders can make data driven decisions to benefit the company. They can better lead the business and reduce the unforced errors that impact the bottom line.
The Advantage of Distributor-Driven Service over Individual Suppliers
Many companies believe there are advantages to using an individual supplier over a distributor. They think the manufacturer of the product has more control over the price and is more reliable.
That may have been true in the past, but with market expansion and increasingly complex supply chains, you simply cannot get the same benefits from a single supplier. Just like your business, you need to diversify your suppliers. This is the advantage of a distributor-driven managed service provider. They offer the benefits of supplier diversity, without the additional complexity or cost.
For both supplies and service, the MSP taps into the market to identify and target the most beneficial resources. You and your business work with only the best, and at a much lower cost than if you brought the work or service in-house.
If you have additional questions about managed services or would like to schedule time to talk about your business needs, then contact GO2 Partners today.