Choosing the Right Enterprise Managed Services Provider

CIO reports on some good news for the tech industry going into 2024: Budgets are increasing. Artificial intelligence (AI) is the showstopper this year, with considerable buzz around generative tools like ChatGPT.

But more quietly behind the scenes, mid-market and enterprise organizations’ use of managed services continues to increase. As a percentage of total technology spending, enterprise managed services will grow by 18% through the end of this year. Globally, the enterprise IT managed service market will exceed $671.14 billion by 2030.

Enterprise organizations actively seeking a managed service partner face some soul-searching around choosing the right MSP. What criteria should these organizations use when making this choice?

Understanding Enterprise Managed Services

Enterprise managed services encompass a suite of IT services and solutions outsourced to a third-party provider. The goal is to deliver better service to the business lines and customers that depend on your IT architecture, including human resources (HR), sales, finance and more. Enterprise IT managed service can encompass human expertise, software and best practices that streamline and optimize business processes through a technology infrastructure.

Enterprise managed services are functionally an extension of a concept known as information technology service management (ITSM), “the activities an organization performs to design, build, operate and maintain information technology (IT) services offered to internal and external customers.” Significantly, ITSM goes beyond asset management to embrace strategy, such as developing digital transformation or upgrading a legacy platform to streamline operations. It can also embrace change management and collaboration, something critical to a new software deployment at the end-user level.

Enterprise IT services can cover various aspects of an organization’s IT infrastructure, including:

• Modern infrastructure management: Monitoring and maintaining network infrastructure to ensure optimal performance and security. This service may encompass managing and maintaining on-premises servers to ensure they are reliable and up-to-date or designing, deploying and maintaining a multi-cloud environment.
• Data backup and recovery and cybersecurity: Enterprise IT managed services can also focus on implementing robust backup and disaster recovery solutions to safeguard critical data. Cybersecurity is another service designed around protecting the organization against cyber threats through firewall management, intrusion detection, testing and more.
• Helpdesk and end-user support: Providing 24/7/365 technical support to end-users and resolving IT issues promptly.
• Unified communications management: Offers proactive management of organizational communications tools, whether phone systems, software and cloud/on-premises third-party applications.

Enterprise IT managed services providers offer these services on a subscription-based model, allowing organizations to access top-tier expertise and resources without the overhead of managing an in-house IT team. By outsourcing these services, businesses can focus on their core operations while leveraging the provider’s specialized knowledge and experience.

The Benefits of Enterprise Managed Services

Opting for enterprise managed services can offer a multitude of benefits to organizations of all sizes:

• Cost savings: One of the primary advantages of outsourcing IT management is cost savings. The cost savings from avoiding IT downtime may be incalculable, but organizations like Cisco say outsourcing to an enterprise managed service provider can cut costs by 40%. Maintaining an in-house IT department involves hiring and training staff, investing in hardware and software and dealing with ongoing operational expenses.
• Access to expertise: 77% of the C-suite says hiring and retaining talent is their primary concern. That makes the IT expertise an enterprise managed services provider offers critically essential to these organizations. Managed services providers are staffed with experienced IT professionals possessing critical expertise in a variety of areas. This access to a diverse skill set ensures that your organization benefits from the latest industry knowledge and best practices.
• Scalability and flexibility: Enterprise IT managed services are scalable to fit your requirements. They can adjust to a tumultuous marketplace, where organizations experience rapid growth or feel the need to downsize. An IT MSP can adapt their offering accordingly, ensuring that your IT infrastructure aligns with your organizational goals.
• Enhanced security: Cybersecurity threats are on the rise, making it crucial for enterprises to bolster their defenses. Managed service providers are well-equipped to implement robust security measures, conduct regular audits and respond swiftly to security incidents, reducing the risk of data breaches and downtime.
• Focus on core competencies: A lack of time significantly correlates to a lack of innovation. When IT teams feel pressure to digitally transform, but stay bogged down in trouble tickets, an enterprise managed services team is the solution. By offloading IT management to a trusted provider, organizations can concentrate on their core competencies and strategic initiatives rather than getting mired in technical details.

What to Look for in an Enterprise Managed Services Provider

Selecting the right enterprise managed services provider is a critical decision that can significantly impact your organization’s success. While everyone has an opinion about what to look for in a third-party IT vendor, a few factors stand out consistently in the hundreds of articles on this topic.

• Strategic focus: Look for a provider with deep skills beyond the operating system to encompass strategy. Enterprise organizations should look for skills in change management, virtualization and cross-platform integration to get the most bang for your MSP dollar.
• Proactive: Your MSP partner should go beyond break/fix and have a proactive strategy for preventing problems before they occur. For example, advanced analytics can help spot failure patterns that could lead to future network downtime.
• Innovative and forward-thinking: Ask the vendor-partner about their strategies for maximizing IT resources. What best practices do they have in place for streamlining redundant services? Do they have experience implementing or supporting agile DevOps? These higher-end services go well beyond keeping the lights on but are a necessary component of any strategic technology relationship.
• Experienced with today’s infrastructure complexities: An enterprise managed IT services provider should also have a track record managing multi cloud and multi-vendor environments. They should add value to help the organization handle these complexities along with some of the more standard services that come with traditional managed service offerings.
• Broad portfolio: Examine the provider’s range of services to ensure alignment with your requirements. Look for a broad portfolio of services that align to your business model. A comprehensive service portfolio that includes network management, security services and cloud management can be advantageous, as it allows you to address multiple IT needs under one roof.
• Culture fit: Finally, consider culture fit. The managed service provider will work elbow-to-elbow with your internal IT team. In addition to having relevant industry experience, these companies should care about the same things your team does, whether it’s best business practices, innovative technology or strategies to improve KPIs. They should be as people and relationship focused as they are technology savvy.

Information Week says, “The biggest mistake when choosing an MSP is basing the decision on technical capabilities alone, not on the provider’s ability to align IT with business goals.” No matter your ultimate criteria, preparing to hire a managed IT services provider (MSP) is a crucial step for organizations looking to outsource their IT management and support. The right MSP can significantly impact your organization’s efficiency, security and overall success.

However, in addition to conducting due diligence on the third-party vendor, preparing your organization for the transition is essential. How should organizations prepare for hiring an enterprise IT managed services provider?

Preparing for Enterprise Managed IT

Preparing to hire an enterprise IT managed services provider is a multifaceted process that requires careful consideration and planning. Organizations should begin with an in-depth analysis of their existing IT infrastructure, identifying specific pain points or challenges they aim to address, along with KPIs for a successful relationship. By clearly defining their objectives, enterprise organizations can communicate expectations more effectively to potential providers, ensuring a better match between their requirements and the services they select.

Budgeting and resource allocation are critical aspects of preparation. Organizations must establish a realistic budget for IT managed services, considering ongoing monthly costs and initial setup fees. Concurrently, organizations must decide which IT resources they intend to retain in-house and which aspects they expect the managed services provider to handle. This process helps to define the scope of services required. It can also guide discussions with potential providers regarding the support and expertise you need.

Finally, organizations should thoroughly research to identify suitable enterprise IT managed services providers. This process involves compiling a list of potential candidates based on recommendations, online research and industry insights. Evaluate each provider’s credentials, certifications and industry experience. Organizations should scrutinize the service portfolios offered by these providers to ascertain alignment with their specific IT requirements. A comprehensive evaluation process enables organizations to select a provider that not only meets their immediate needs but also has the potential to grow and adapt as their IT landscape evolves.

Step-by-Step Process for Vetting and Choosing an MSP

Here’s a step-by-step guide on how organizations should prepare to hire a managed IT services provider:

• Define your IT needs and goals
  • Start by evaluating your existing IT infrastructure
  • Determine specific IT pain points
  • Set clear goals
• Budgeting and resource allocation
  • Define a budget for IT managed services
  • Decide what resources you will retain in-house and what you expect the MSP to handle
• Research and identify potential MSPs
  • Create a list and check credentials
  • Assess service offerings against your requirements
  • Consider whether the MSP can customize its service offering
• Evaluate service level agreements (SLAs)
  • Have legal review the SLA
  • Request references
• Security and compliance
  • Inquire about the MSP’s cybersecurity practices
  • If your organization operates in a regulated industry, ensure the MSP understands and complies with industry-specific regulations
• Scalability and flexibility
  • Evaluate the MSP’s ability to scale
• Communication and responsiveness
  • Examine the MSP’s communication channels, support hours and accessibility
• Disaster recovery
  • Inquire about the MSP’s disaster recovery and backup solutions
• Visit their facilities
  • If possible, schedule a visit to review the managed services operations site
• Evaluate costs
  • Conduct a cost vs. benefit analysis
• Legal review and final selection
  • Engage your legal team to review the contracts and agreements
• Onboarding
  • Collaborate closely to ensure a smooth transition
• Monitoring
  • Continuously monitor the MSP’s performance against SLAs and KPIs
  • Maintain open and transparent communication

What’s Next for Enterprise IT Managed Services?

Deloitte’s 2022 global outsourcing survey sought to determine what’s next in the managed services world. Their study showed:

• 50% of enterprise executives say talent acquisition remains a critical problem in meeting their organizational objectives.
• These organizations frequently turn to enterprise managed services, particularly in IT. However, these third-party delivery models are evolving toward a comprehensive “operate services” model that seeks to go beyond traditional third-party outsourcing. There is a need, Deloitte insists, for expertise beyond technology; instead, enterprise IT managed services companies must offer strategic
• At least three of every four IT executives report using an IT managed service provider to support cybersecurity. The survey showed cybersecurity is “the number one external challenge they face in achieving their strategic objectives.”
• The survey also showed an increasing need for vendor management. Deloitte suggests, “As the complexity, number of third-party choices, and configuration options for service delivery models expand, now is the time to ensure that enterprises have a robust strategy and framework to manage an ecosystem of third-party relationships.

While the managed service market is evolving, the data also shows 60% of organizations will remain dependent on these services through 2025.

In an increasingly digital and competitive world, partnering with the right managed services provider can be a pivotal step toward achieving your IT goals and ensuring the long-term success of your enterprise.

Red River is a top trusted managed IT services provider for enterprise organizations nationwide. Our services go well beyond IT infrastructure management to include digital transformation strategies to transform how you do business.

Talk with our team today about how we meet these organizations changing requirements is some of the most heavily regulated and fast-paced industries. We have the experience that goes beyond IT management to encompass digital transformation strategies to build your business. Contact us to find out more.