Process and value

Companies operating in the managed services arena can carry many different labels

During the past decade many organisations derived value from professional services firms by seeking their help in navigating large and frequent technology implementations, such as moving from mainframes to client/server, Y2K, compliance, ERP, or implementing Web-based technologies.

Today the emphasis is moving towards business processes rather than business in its entirety. Business process improvement has emerged as the new driver of business value. Companies previously implemented so much technology in order to be competitive now. Instead of technology being the prime driver for business process improvement, companies are now looking for deep experience and analysis skills that can enhance their business performance.

Differentiating companies or their offerings has become a big challenge for services and solutions marketers. To make it more difficult they all want to position themselves in the same space in customers' minds, but under different labels.

Personal relationships are still the drivers of purchasing decisions for many services buyers. Many companies also believe that mergers and acquisitions are a key means of growth. By combining companies they hope to gain market share, new markets, a wider range of offerings, and cost efficiencies. But even in the same industry sector, companies that seem compatible may have dramatic differences in their values and the way they function.

The majority of IT departments today spend at least 70 per cent of their time maintaining the systems they already have. The managed services arena also has many different labels, and finding a partner or a vendor is often a difficult task because of all the features that need to be considered. At the same time, managed service providers are all scrambling to expand their service offerings.

One major reason managed services are increasingly attractive to organisations is that their IT and communications organisations are being forced to do more with fewer resources.

Going outside with an MSP can not only provide additional resources but also lead to improved delivery and increased utilisation. Managed Services represents a fundamental change in the way IT solution providers approach the market and interact with their customers. Rather than depend on traditional product-centric installations or break-fix work, managed services require IT solution providers to take a more holistic view of their clients' businesses.

If IT is to be an asset to the business rather than a liability, it cannot be managed haphazardly as an add-on to the business. To derive maximum value, solid processes and procedures are essential in order to deliver measurable results and add value to the business.

Len Rust is publisher of The Rust Report

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