Posted by: fedsolutions | November 15, 2011

What are Managed Services – Part 1: Evolutionary Forces at Work

To begin the process of defining and understanding what Managed Services are, it is important to look back in time.  It used to be that only big companies had complex IT networks. Small and midmarket businesses had limited networks ranging from “two-cans-and-a-string” to basic workgroups connecting workstations and a file share (if you were lucky).  It was not so much that small and midmarket businesses were less complex than bigger firms in terms of day-to-day operations and business needs.  Rather, the cost of owning and managing these complex networks was prohibitive.  Simply put, the need was always there but the cost could not be justified.

Bell-bottoms, Disco, and Desktops?! Remember when the first desktops came out? Ok…maybe you don’t. It was the late 1970s and computers with names like the Commodore PET, the TRS-80, and the Apple II were being released.  They were bulky, expensive and less powerful than today’s pocket calculators. More and more companies started to compete to build faster and better computers.  Fast forward a couple of decades and today you can purchase tablets, desktops, and smartphones that are literary a million times more powerful at a fraction of the cost.  At last desktop computing was affordable and ubiquitous! The changing landscape of desktop computers is a great example of how economic and competitive forces can lead to progress. I call this evolution.

Evolution is a Juggernaut.  The same forces that promoted the evolution of desktop computing also transformed IT networks and infrastructure.   Today, small and midmarket businesses have easy and cost-effective access to complex networks once reserved for larger enterprises.   The need was always there – and evolution made it happen. Now all businesses can leverage the power of technology to streamline complex business operations and increase workforce productivity. Today, it is common to see small and midmarket companies using a dozen servers running a variety of communication, collaboration, and other business services.  This was absolutely unthinkable a decade ago. Ah…evolution, you truly are a formidable beast.

Transforming a Service. As company networks evolved and became more affordable and more prevalent in small and midmarket companies, so too did the need for services to manage, support, and maintain them. Early service models revolved around the concept of “Break and Fix”. Simply put, companies would contact an IT service provider when something was broken.  In turn, the service provider would dispatch an engineer or technician to the client site to fix the problem while charging an hourly rate. This model, still in place today, is rife with inefficiency. It is costly and leads to unnecessary frustration for clients.  Worst of all, it does not allow small and midmarket firms to fully harness the power of technology. Ultimately, clients start to view their technology as a source of burden instead of an important investment that yields strong business rewards.   This is a lose-lose situation for everybody involved. In addition, IT networks are continuing their fast-paced evolution and becoming more and more complex.  This evolution is yet again creating forces that are changing the nature of how users, servers, workstations, and other network components are managed, maintained, and supported.

One thing is clear and apparent:  The “Break and Fix” model is being stretched beyond its limitations.  It simply does not have the capacity to deliver the efficient and cost effective services that clients need to transform their IT infrastructure from a cost-center to a strategic tool. The “Break and Fix” model needs to evolve. Service providers must adapt or perish.

Enter Managed Services.

In the next blog entry, we will provide and detailed definition of Managed Services.  We will identify the key characteristics of successful Managed Services and the benefits they provide to clients


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