Reasons for Managed Services in 2016

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    Original Source: MSP Blog

    As cited in CompTIA's 4th Annual Trends in Managed Services report, "the global managed-services market is predicted to grow to $193B by 2019, at a Compound Annual Growth Rate (CAGR) of 12.5%." What is fueling this impressive level of adoption? Why are so many business owners fans of your business model? We dug into the report to examine the top reasons small-to-medium-sized businesses (SMBs) list for working with MSPs and IT solutions providers. As you build your 2016 sales strategy, pay attention to these main market drivers.

    Why SMB Owners Demand Managed Services

    When thinking about how best to position your managed IT services, it's worth considering what points make for the most compelling sell. Remember that while you may think they should adopt your business model for one reason, they may have an entirely different set of priorities that you should appeal to first. So what should you lead with when marketing and selling to prospective clients? Using data presented in CompTIA's report as reference, we break it down for you! How well do you deliver - and communicate that you deliver - each of the following?


    Let's break the top five down:

    1. Increased efficiency/reliability of IT operations
    As depicted in the chart above, 56 percent of companies with over a hundred employees list this as the main reason for working with a managed services provider (MSP). Indeed, it is the single most popular reason given. Often, the SMBs you aim to partner with have over-burdened IT staff with employees who may lack the skills and training for certain tasks or can't handle the whole of the company's network on their own. In response, these companies recognize the value of working with an outside technical support team. According to CompTIA's report, "60 percent of end users describe their managed services engagement as a collaborative arrangement with their internal IT department, suggesting that certain IT areas fall into the MSP bucket, while others remain in house." Notice how the reason provided is to improve the abilities of the in house team, not to do away with these IT employees altogether. Not only does it help having an extra team of IT experts able to troubleshoot and remediate issues that arise, clients benefit from having access to the latest technology and business-grade solutions that maintain uptime and profitability, such as remote monitoring and management (RMM), backup and disaster recovery (BDR) and cloud computing. Investing in these tools increases the reliability of organizations' IT infrastructure. Investing in the managed services business model tackles existing labor constraints and prevents internal IT departments from always having to play catch-up.

    2. Enhanced security/compliance
    Laptops, desktops, smartphones, applications, tablets, servers, operating systems, browsers, wearable technology and the like all store and transmit data and thus require the strictest security measures. Prospective clients will turn to you out of fear of becoming the next headline in a high-profile data breach or data loss incident. Remind them of the most notorious examples highlighted in the media, and share the results and fallout. Use the information shared in our Top 10 Data Breaches of 2015 infographic to reach prospects who may share similar company profiles. Are you offering compliance as a service? If you're trying to convince a doctor's office to consider you, begin by stressing the importance of working with a HIPAA compliant IT solutions provider, one who understands HIPAA regulations and how to supplement them with additional managed security protocol, policies and procedures. Reference the Anthem data breach, which implicated one-third of Americans and compromised the medical data of nearly 100 million individuals. As CompTIA's study finds, security and data protection resonates with your target audience. Along these lines, compliance is becoming even more of an outsourced IT adoption driver for SMB owners, especially with regard to PCI security standards, since many businesses offer e-commerce on their websites.

    3. Proactive approach to maintenance
    This is a benefit of managed IT services that we discuss a lot because it is so important. Your clients don't want to have to think about their daily IT operations. They don't want to have to second-guess the reliability and speediness of their network connection. Similarly, they don't want to have to worry about what the state their IT environment will be when they commute in to work each morning. They choose to work with an MSP because you can provide 24/7/365 coverage. Services like RMM and the security suite you offer detect potential disturbances and vulnerabilities, allowing you to resolve these problems before they develop into more critical threats. When you offer fully managed IT support, you can often troubleshoot and remediate glitches or bugs before the client is any the wiser. Again, they're paying you to worry about these things for them. Does a CEO have the time to verify that the backups his company has taken actually worked? We already know that data management in the cloud is expected to yield more managed services revenue in 2016. In working with the right MSP, key executives can take advantage of proactive BDR solutions that offer business continuity by combining RMM intelligence with regular, encrypted backups, cloud computing capabilities and IT virtualization.

    Click here to view the final two factors!

  • Service Provider

    Well we are an MSP so we might be biased, but for the majority of the SMB, anything but externally managed services just seems crazy. The cost of maintaining skills in house is very high and the efficiency is very low.

  • @scottalanmiller In house is very expensive, yes. What is your take on SMBs that seem stuck in the "break-fix" mindset?

  • Service Provider

    @GlennBarley said:

    @scottalanmiller In house is very expensive, yes. What is your take on SMBs that seem stuck in the "break-fix" mindset?

    My take is "that's what makes them SMBs in most cases." There are two kinds of SMBs (mostly), those that will never be anything else and will likely fail, and those that won't be SMBs for long. Outside of rare cases like single restaurants and similar, people don't start companies intending to be SMBs. SMB is where they have stalled while they were failing to get where they wanted. They just haven't failed all the way to the point of going out of business yet.

    Most of the time, the thing that makes them SMBs is either that they are new and won't stay small, or that they don't know how to run a business and make fundamentally bad decisions over and over again.