Managed Service and its opportunities

MSP Alliance Member

A managed IT service is an information technology task provided by UMS and delivered to you. UMS will be your own IT department and will deliver quality services for your benefits.

 “Managed Services” is the newest catchword humming around the Information Technology (IT) world. The IT support space finds itself a blow in the middle of this dynamic. If you find yourself working in the domain, chances are you have come across at least one of these terms in the past year:

  • Managed Services
  • Managed IT Solutions
  • Managed Service Provider

So, what is all the concern all about? Well, Managed IT Services, when deployed from a trusted source, provide a single point of service, lower costs and optimize productivity to offer you peace of mind.

It becomes more important for you to be aware of Managed Services as, more than likely, you’re going to need it if you aren’t using it already. Here’s a quick glance at what Managed IT Solutions are before delving into how to use it and get the most out of your business.

Definition of Managed Services

In simple terms, Managed IT Solutions, or Managed Services, allow a business to hand over its IT operations by having a service provider that can take care of everything. This off-premise service provider is also known as a Managed Services Provider (MSP).

A managed service provider (MSP) is a company that remotely manages a customer’s IT infrastructure and/or end-user systems, typically on a proactive basis and under a subscription model. Today, the terms “cloud service provider” and “managed service provider” are sometimes used as synonyms when the provider’s service is supported by a service level agreement (SLA) and is delivered over the internet.

Managed Service

Service-level agreements

An MSP often provides its service offering under a service-level agreement, a contractual arrangement between the MSP and its customer that spells out the performance and quality metrics that will govern the relationship.

An SLA may be linked to an MSP’s pricing formula. For example, an MSP may offer a range of SLAs to customers, with the customer paying a higher fee for higher levels of service in a tiered pricing structure.

Managed Service Evolution

The evolution of MSPs began in the 1990s with the emergence of application service providers (ASPs), which offered remote application hosting services. ASPs helped pave the way for cloud computing and companies that would provide remote support for customers’ IT infrastructure. MSPs, for the most part, initially focused on the remote management and monitoring (RMM) of servers and networks. Over time, MSPs have expanded the scope of their services in a bid to differentiate themselves from other providers.

While some MSPs may specialize in specific segments of information technology such as data storage, others may focus on specific vertical markets, such as legal, financial services, healthcare and manufacturing. Managed security services providers (MSSPs), for instance, offer specialized services such as remote firewall administration and other security-as-a-service offerings. Managed print services (MPS) providers, meanwhile, offload the task of maintaining printers and supplying consumables.

The necessity of Managed IT Services

As more and more enterprises hedge on the Managed IT Services trend, it’s easy to measure that the benefits of managed services are diverse. Conventionally, IT related machine or network maintenance was done using only the “break-fix” methodology. This meant that once something broke, the business called a maintenance expert, and they responded to, hopefully, fix the problem.

By handing IT operations over to a reliable MSP, the provider is responsible for managing, monitoring or resolving problems for selected IT systems and functions on your behalf. This allows you to focus on your core business processes rather than being stuck by IT issues.

Challenges of managed service providers

A key challenge for MSP business management is to set pricing low enough to entice customers to buy their services but high enough to maintain an adequate profit margin.

In addition to pricing, MSPs pay close attention to operating costs and the cost of maintaining skilled employees. Labor is typically an MSP’s greatest expense. To keep labor costs in check and improve efficiency, most MSPs employ remote monitoring and management (RMM) software to keep tabs on clients’ IT functions. RMM software lets MSPs remotely troubleshoot and remediate issues with servers and endpoint devices. With RMM, MSPs can manage numerous customers’ IT systems simultaneously. MSPs may also use automated scripts to handle routine systems administration functions, such as checking hard disks for errors, without human intervention.

Another challenge MSPs face is the mainstream adoption of cloud computing. As more of their customers’ IT infrastructure components migrate to the cloud, MSPs have had to find ways to manage hybrid cloud environments. MSPs also seek to provide their own cloud computing services or resell other cloud providers’ capabilities, with cloud-based backup and disaster recovery (DR) a common entry point.

In addition, just becoming an MSP can prove challenging. The prospect of MRR has attracted many traditional solutions provider companies, such as VARs, to the MSP business model. However, would-be MSPs have struggled to establish themselves in the market. The MSP line of business calls for companies to adopt different performance metrics, technology infrastructure components and sales compensation programs, to name a few challenges. As a result, many MSPs derive revenue from business lines other than managed services, such as IT project work, break/fix business and on-site support. Pure-play MSPs are relatively rare in the IT services industry.

Why Should You Care About Managed IT Services?

Well-established and expanding enterprises need superior technology to compete effectively in the market. However, maintaining a large IT resource on premise to keep up with an increasingly complex IT environment is not an easy task for small businesses. They depend on a functional IT infrastructure that runs without interruptions and adjusts to their often tight budgets.

MSPs offer security, alerts, patch management and data backup along with a series of options for client devices like servers, desktops, storage systems, notebooks, networks and individual applications. 

5 Reasons Why MSPs are chosen

It seems a large percentage of small- and medium-sized businesses are very much in favor of these services, and there are a number of good reasons why.

Research shows that the reason our clients choose our services are not necessarily the reasons why we think they should. Business owners are looking for a wide range of benefits when they opt for a managed services model, and what they want is:

  • To improve the efficiency and dependability of their IT operations.
  • Enhanced security and compliance.
  • A proactive approach to maintenance.
  • Cost effectiveness and a good return on investment.
  • Free up IT staff to work on strategic projects.
  • Have greater access to new technologies.
  • Lacks in-house IT capabilities for certain functions.
  • Shifting capital expenses to operating expenses.
  • Predictable pricing and manageable costs.

Let’s take a closer look at some of the more pressing reasons why managed services are becoming the obvious choice for small to medium sized business owners.

  1. More Efficient and Reliable IT Operations

This is one of the main reasons that companies with over 100 employees decide that managed services are the right choice for them. Often, the businesses we partner with as managed-service providers are suffering from overburdened IT staff, or lack employees that have the knowledge and skills to handle certain tasks and successfully handle the entire network on their own.

In these situations, it is hard to deny the value of working with an outside IT service provider. A majority of businesses using managed-services describe their partnership with their provider as a collaborative arrangement with their internal IT department, leading one to believe that certain aspects of IT management fall into the MSP bucket while others are preferably handled in-house. The driving force for these business owners is to improve and enhance the capabilities of the in-house IT team, not replace them altogether. Outsourcing IT not only ensures an extra team of IT experts to help resolve any issues or concerns but to be able to benefit from having access to the latest and greatest technology and innovative business grade solutions that will assist in maximizing uptime and profitability. These technologies include such things as:

  • Remote monitoring and management (RMM)
  • Backup and disaster recovery (BDR)
  • Cloud computing

By investing in these tools the entire IT infrastructure becomes more reliable and dependable, labor constraints are overcome, and internal IT departments are able to keep in control of the situation.

  • Enhanced Security and Compliance

There are so many variations of technology that store and transmit data nowadays, including tablets, operating systems, servers, smartphones, laptops and more. Because data is stored and transmitted on these devices it means their security is critical. Many business owners live in fear that they will fall victim to a security breach. As a managed service provider it is your job to make them well aware of the risks, sharing examples that have been highlighted in the media and explaining how their data and compliance practices are compromised when such an event arises.

It is also crucial you address the business owners concerns about compliance, especially in industries such as health and legal, where compliance is a major concern. For these people it is important they work with a provider that is HIPAA compliant and in addition, can implement other ways to supplement additional managed security protocol, policies, and procedures.

  • A Proactive Approach to Maintenance

This is a major and important benefit to managed IT services. Business owners have little to no time to spend thinking about their IT infrastructure, worrying about things such as the dependability and speed of the network connections, and other concerns. By working with an MSP they are afforded the luxury of all-day, every-day, around-the-clock coverage.

Security solutions and services such as RMM are always working to detect potential threats, vulnerabilities, or potential disturbances. When you provide fully managed IT support, bugs and issues can most often be troubleshot and remediated before they are ever a concern to the business owner. Owners are happy to pay for such a service, as CEOs and others have no time to be verifying that backups are done properly. It has become more than clear that data management on the cloud is expected to yield more managed services revenue in the coming year, and when business work with the right MSP they are able to take advantage of proactive business continuity solutions, such as BDR, by combining RMM intelligence with regular and encrypted backups, cloud computing, and virtualization.

  • Cost Effectiveness and Return on Investment

The cost savings associated with managed services is considerable, making it another reason that using MSP’s is desirable. This fact has an incredible amount of business value, but many business owners are unaware of just how significant this is. It is your job as a managed service provider to explain to your clients how MSPs help control outgoing expenses and increase ROI. An IT budget consists of many items, including:

  • hardware costs
  • software and network infrastructure
  • maintenance costs
  • IT labor

The businesses you work with need to understand every-way that managed services can benefit them financially, especially where the aforementioned maintenance costs are concerned. Using outdated software can have detrimental effects on ROI, and this is avoided with MSPs. In additional it provides the flexibility and scalability needed to grow or scale back in a way not possible with internal IT teams.

The managed service model allows clients to easily predict their IT expenses on a monthly basis and are able to better plan and budget for larger IT projects and improvements. All of these factors should be reviewed in a quarterly business review. You are able to show your clients the value of your services during these reviews, and how you play an instrumental role in what they do.

  • Free Up Internal IT Staff To Work On Strategic Projects

When businesses choose a managed-service provider a major advantage they often don’t think of with an outside service provider, is that any internal IT staff is free to focus their energy and talents on projects and tasks they are better suited to handle.

This increases productivity and allows strategic planning to get the time and attention it deserves.

This maximizes the business’s IT budget and the business is able to get the most out of their investment.

It doesn’t make much sense to have your internal IT team handling things they have little expertise or experience with. Things like migrating over to Microsoft Office 365 when it can be expertly handled by an MSP instead, and the technician can commit their time to something they excel at. Managed-services enable in-house staff to spend their working hours on what they are best at, with the MSP filling in the gaps and taking the pressure off, providing specialized services where they are needed most.

As managed service providers we are well aware of the benefits and advantages of the services we offer, but it is our job to help our clients see them as well. By better understanding what it is they are looking for and how their businesses can be best supported we are able to tailor our offerings and approach to better meet those needs.

Pricing model for managed service provider

In per-device pricing, the MSP charges the customer a flat fee for each device under management. In per-user pricing, meanwhile, the MSP charges a flat fee for each user, accommodating users who use multiple devices. In all-inclusive pricing, also referred to as the all-you-can-eat model, the MSP charges a flat fee for all the IT infrastructure support and management services the MSP plans to offer.

In each of those pricing approaches, the customer pays the flat fee on a regularly scheduled basis, often monthly. Such pricing methods let MSPs sell services under a subscription model. This approach provides the MSP with a monthly recurring revenue (MRR) stream, in contrast to IT projects that tend to be one-time transactions.

MRR is one aspect of managed services work that differs from other business models in the IT solutions provider and channel partner space. Solutions providers pursuing the break/fix model, for example, usually price their services on a time and materials (T&M) basis, billing an hourly rate for repairing a customer’s IT equipment and charging for parts or replacement gear.

Companies performing IT project work, such as computer systems installation and integration, may charge a fixed price for products and services. Either way, those solutions providers generate revenue on a one-time basis from each project. An exception would be large projects with multiple milestones and associated payments. But, in general, the conventional solutions provider business is mainly transactional. An MSP’s recurring revenue stream, on the other hand, potentially provides a more stable and predictable base of business.

The Managed Service by UMS

Union Mercantile Solutions is an innovative & dynamic information technology organization. The goal of our company is to support startups, business & industry of Bangladesh to find a niche and develop research models for expansion for their service or products, locally and internationally. Our IT architects design integrated internet systems compatible with latest technology on a global scale. Engineering experts help build the technical infrastructure that is secure and sustainable.

UMS by Union Mercantile Ltd. is an IT solution company with a view of low cost IT service where on hand experience was gathered by working for in house IT solutions for our valuable engineering customers like Samsung, Cisco, Ericsson and many others.IT department of Union Mercantile Ltd was capable of doing all the necessary IT consultancy, setup, procurement of many big engineering projects. Gradually UMS was established as a standalone IT solutions and service entity with the same expertise and has since partnered with ORACLE of USA, ERPNext and MSP Alliance  as a full-fledged solution providers for Oracle NetSuite and ERPNext ERP Solutions alongside Managed Service Provider, UMS started its journey with a vision of giving futuristic solutions and service to its customer and ease the customers IT problems with comprehensive understanding. UMS mission is to give customer the best IT solution and service which enables them to utilize to the fullest its potential and resources and bring to the fore all ERP solutions and related software solution at a glance.

Sources:

  1. https://www.provintl.com/blog/managed-it-solutions-explained
  2. https://searchitchannel.techtarget.com/defini/tion/managed-service-provider
  3. https://rgtechnologies.com.au/resources/managed-it-services/
  4. https://www.sensiblesystems.com/5-reasons-businesses-today-are-choosing-managed-it-services