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The Emergence of Business Service Management

By Phil Rackus Small and medium-sized businesses seeking managed service providers should look for those that can provide intrinsic value to their customer base, rather than just IT services.
Apr 26, 2004
By

ITSM Watch Staff





By Phil Rackus

After several years of turmoil and confusion, I finally feel that I can say it out loud - managed services in small and mid-sized businesses (SMB) make sense.

Small companies don't usually have the resources to manage their IT infrastructure adequately, but also may not require (or have the cash for) a full-time IT professional. When small companies do decide to hire a dedicated IT person, they tend to have difficulty acquiring the best resources to do the job effectively. For these reasons, and many more, outsourcing is expected to grow substantially over the next several years.

Unfortunately, a large number of outsourcing relationships fail, and the costs associated with these failures is extreme - not only in terms of provisioning a new managed service provider (MSP) but also in terms of downtime, lost productivity and lost opportunity.

While typical conversations about such failures will cite cost overruns and delivery of services that were aligned with expectations, these issues can be seen as symptomatic of a larger problem - a fundamental communications breakdown between the service provider and the customer.

A typical MSP serving the small to medium-sized business is relatively modest (10 to 50 employees) with very little in the way of standardized processes or approaches. Effectively all have evolved out of the technology world, with most still incorporating hardware, time, materials or project-based services within their organization.

The typical small business, on the other hand, has less than 100 employees. These workers usually have a very limited understanding of technology, but possess a high degree of expertise about their business. They might not understand technology, but they understand the cost to their business when their technology fails to deliver.

A close look at the typical MSP and the typical SMB customer reveals that communication breakdowns are the reasons for the failure of many relationships. The service provider tends to consider things from a technician's standpoint. The customer, on the other hand, doesn't care about technology at all. By and large the customer is only interested in technology in as much as it enables a business objective.

Phil Rackus is Vice President of Product Management at N-able Technologies. Phil spearheads the product management team, which drives the strategic direction of the technology and the company.


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