Over the past few years, the term “managed services” has become more prevalent in the IT services community. It’s how many companies these days are consuming IT services, especially companies without the need or the budget for a full-time IT department. In its most basic sense, managed service delivery is the utilization of remote tools in which an IT service company can remotely manage and support a client’s IT environment.
These tools allow the remote monitoring, patching, upgrading and support of a client’s servers, workstations, and network devices. These services are usually priced on a “per device or user/per month” model, with the idea that a network can be maintained for a “fixed fee” per month.
“There are distinct advantages to this IT service delivery model, both to the IT company as well as to the client,” says Zack Schuler, founder and CEO of Cal Net Technology Group. “First, from the IT company’s perspective, they can automate most of the routine tasks that are associated with maintaining a computing environment. These remote management tools have many automated processes that can be turned on, thus saving the IT company time and money.”
Smart Business spoke to Schuler about how to get the most from managed IT services.
How do businesses benefit from managed services?
First, this service delivery model helps clients manage their IT budgets a bit more closely, as many of the services are delivered on a fixed fee. This adds predictability to the ongoing cost of IT. Next, if the IT company has perfected its own processes around these tools, the ‘human error’ factor of manual maintenance goes away.
With all of the benefits to managed services, if a company looks at it as its only answer to IT services, it is doing itself a huge disservice. While managed services might be the answer to basic maintenance of the system, it neglects helping companies to truly drive value out of their IT resources. Managed services, when pitched as the solution, put consumers in a highly commoditized mindset. IT services should not be viewed as commodity services since, if delivered correctly, they can add serious bottom line advantages to the business.
How can businesses ensure these services are effective?
A less known term in the industry is ‘blended services.’ Blended services are a strategic combination of managed services and professional services that are packaged together to deliver the ultimate amount of value to the customer. This consists of looking hard at those services that can take advantage of remote tool sets and automation, and subsequently injecting intellectual capital into every other facet of IT that cannot be automated.
Part of blended services consist of pre-scheduled on-site consulting time. The face-to-face interaction that occurs during this time is invaluable to the business. It is during this time that questions like, ‘What is the best way to do such and such on my computer?’ or ‘What application can solve this business process issue that we have?’ are more likely to get answered. It is this face-to-face interaction that leads to new efficiencies being discovered, and people at the company ultimately being more productive.
If services are delivered 100 percent remotely, the chances are slim that a person will pick up the phone and call a relative stranger to ask about the best way to do something.
How can executives be sure they derive value from managed services?
They need to see the value in IT and its effectiveness as a bottom line tool. Too many executives at companies have traditionally been ‘technophobes’ and view IT strictly as overhead, a necessary evil, as opposed to a bottom-line boosting critical part of the business. In short, when consuming IT services, make sure that you are as equally engaged as your service provider.
Make sure that you see past the commoditized services being sold to you, and that you ask your IT company to do more and to prove its real value. Assuming you are paired up with the right organization, they will help you take your company to the next level. This might cost more in the very short run, but in the not too distant future, the ROI will be there.
Zack Schuler is the founder and CEO of Cal Net Technology Group. Reach him at email@example.com.
Insights Technology is brought to you by Cal Net Technology Group
"Not a day goes by where I don’t read a headline talking about ‘the cloud,’” says Zack Schuler, founder and CEO of Cal Net Technology Group. “The current, overused definition of the cloud is ‘anything that happens on the Web,’ but in the business world, the more accurate definition of cloud computing is leveraging someone else’s hardware/software and services to complete a business task.”
Smart Business spoke with Schuler about the role that cloud computing has played for businesses during the past two decades, and in what ways it can benefit their operations today and in the future.
How are companies using cloud computing?
When I started Cal Net Technology Group 15 years ago, we didn’t host our own email server. We used an outside company (Earthlink) to host our email, which, in essence, meant that Earthlink was providing ‘cloud services’ for us.
We also have been using an online payroll service for eight years now, whereby we enter our payroll data into a website, and our employee paychecks are processed. Many other businesses might be doing the same. This is truly a ‘cloud service’ that has been around for close to a decade.
Some companies use an Internet-based product called Postini, which has been around since 1999, to scrub their email for spam. I bring this up to point out that all of us have been leveraging the cloud for quite some time, and we probably didn’t even think about it; in actuality, it really isn’t a very new phenomenon.
What are some examples of how businesses can move functions to the cloud?
There is a definite shift in moving some computing resources into another company’s data center in order to save you some headaches and, in some cases, time and money. I use the word some with emphasis here, because if you think that your entire business is moving to the cloud anytime soon, you are probably mistaken — unless your business consists of only a handful of computer users.
The most prominent shift to cloud computing is the migration of email back into the hands of hosted providers, similar to how it was 15 years ago. Microsoft is now in the hosting business with its Office 365 product. It consists of Microsoft Exchange (email server), SharePoint (an intranet product), and Microsoft Lync (instant messaging) in the cloud, with the ability to ‘rent’ Microsoft Office on a per-user, per-month basis, with Office still being installed locally on your desktop.
In moving from an on-premise email solution, such as Microsoft’s Exchange Server, over to Exchange Online, the migration has been very time-consuming, and thus very costly. These migrations have proven to be more costly than moving from one on-premise solution to another. That being said, there can be some significant savings in hardware and software costs, reducing capital expenditure spending for many companies. Additionally, after the solution is running, the ongoing maintenance of on-premise solutions will be gone, which should equate to a cost savings in the long run.
Google has made a significant impact in cloud computing with Google Apps software. From what I’ve seen of the software, it is a good solution for individual use, and for the use of ‘micro-businesses,’ but it reminds me of Office 95 from a functionality standpoint. So, I couldn’t recommend this to any business that relies heavily on word processing.
Perhaps the most successful case study, and a company that has truly made its mark by delivering software over the Internet, is Salesforce.com. It has a very robust feature set within its application, and it was remarkable what it was able to do early on in the cloud-based customer relationship management space.
There are some other line-of-business applications that are cloud-based, as well, and truly deliver a rich user experience, but these are few and far between today, but will be the norm in the next five years.
How can businesses determine what to take to the cloud?
The wise approach is to hire an IT firm with expertise in this area to evaluate your systems, determine the applications that may be ready for the cloud and take a hard look at the overall ROI in moving them.
Zack Schuler is founder and CEO of Cal Net Technology Group. Reach him at firstname.lastname@example.org.
Insights Technology is brought to you by Cal Net Technology Group