What are Managed Services, and Why Should You Care?

Managed services are an ideal solution for small businesses that don’t have the bandwidth to manage business-critical IT functions in-house. But before you sign a contract, it’s important to understand what managed services are, the benefits they provide, and what types of businesses can benefit most from them. 

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What are managed services?

Managed services let you offload specific IT operations to a service provider, known in tech parlance as a managed services provider (MSP). The MSP assumes ongoing responsibility for monitoring, managing, and/or problem resolution for selected IT systems and functions on your behalf.

Managed services providers can offer services such as alerts, security, patch management, data backup, and recovery for different client devices: desktops, notebooks, servers, storage systems, networks, and applications. Offloading routine infrastructure management to an experienced MSP lets you concentrate on running your business with fewer interruptions due to IT issues.

Managed services providers usually price their services on a subscription basis. Depending on the services they provide, pricing is usually based on the number of devices, with different packages priced at different levels. Some provide customer support onsite when required.

Basic services often start with a monitoring service, which notifies you of problems that you are responsible for resolving on your own. At the other end of the spectrum, service providers offer fully managed services that cover everything from alerts to problem resolution.

Typically they perform an initial assessment of your current IT environment and management requirements to help you decide what services and service levels you need.

Benefits of managed services

Just like larger companies, small businesses need technology to operate efficiently and to compete effectively. But as reliance on IT grows, the resources to support an increasingly complex IT environment may not. In many small businesses, IT resources are scarce, and can be quickly overwhelmed with the day-to-day responsibilities of keeping the IT infrastructure that the business depends on up and running.

If you fall behind in keeping up with things such as backups, patches and security, the odds are that you’ll face an IT outage or another problem down the road that will negatively impact your business. For instance, if your email server, customer relationship management (CRM) system, accounting software, or network goes down unexpectedly, you face substantial productivity and revenue losses as a result.

MSPs act as an extension of your IT department, taking care of routine IT infrastructure monitoring and management around the clock—thereby freeing up your IT staff to focus on higher-value projects. By proactively monitoring and maintaining your systems, an MSP provides the right infrastructure to support other business goals, while also helping you avoid many technology problems in the first place. Should an issue occur, an experienced MSP can troubleshoot and resolve it more efficiently.

Unlike traditional outsourcing situations, where you surrender complete control of your IT assets, MSPs allow you to decide what you want the service provider to take care of and what you want to handle. You retain full visibility into the process and management of your systems, which helps with risk management. 

Who needs managed services?

Small businesses that can benefit from managed services the most are those that need more manpower, expert guidance, or better cost control. Very lean teams, for example, can leverage an MSP to fill in the gaps where they need extra support. 

Plus, the services that an MSP provides is specialized for different business needs. When most small business owners have to wear multiple different hats, having third-party experts in your corner is invaluable in times of crisis.

Additionally, businesses that want to scale quickly will benefit from the flexibility that the managed services model offers. The MSP pricing structure is designed to help businesses start small and manage the challenges that come with the growth stage. 

The MSP subscription model also enables better predictability than a consultant-type time and billing model, so small businesses that prioritize cost control can forecast a more accurate budget.

How to choose an MSP

The right MSP will understand your business’s unique challenges. Perhaps you need a service for a specific function, like patch management or disaster recovery, or one that covers a broader segment of IT needs, like security as a whole. Once you’ve evaluated your business needs, look for an MSP that will be a good fit for your budget as well as your short-term and long-term goals.

Read next: Small Business Case Study: Why Move to Cloud Computing?

This article was originally published on September 24, 2009. It was updated by Kaiti Norton.

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