The Business Case for Managed Service Providers (MSP)

by | Sep 21, 2022 | Blog

Why are so many businesses and their leaders now seeking alternatives to traditional in-house IT teams?

In this blog post (which is part one of a three-part post), I’ll explore a simple business case for enlisting a Managed Service Providers (MSP) to provide business value for often overlooked IT service(s).

Whether your company is a small startup, a medium-size well-formed business, or a titan of industry, there is always a need for Information Technology. The IT landscape is an ever-evolving myriad of demand and supply of hardware, software products, projects, problems, resolutions, and that is just the tip of the iceberg.

At the center of this is an IT team with differing organizational structures. The IT team leaders and individual contributors who make decisions on a regular basis as to how best to supply the businesses they support and meet that constant demand.

In my many years of holding different positions at different levels within various IT teams supporting many different businesses, I have observed the challenges these IT teams all face. I have also been fortunate to be a part of some great teams, and some that were … well, let’s just say “not so great.” Within these teams, there is always a dynamic range of personalities and skillsets that come into play when attempting to deliver a project or resolve a major incident. And while there are IT teams that can do this efficiently, the majority of IT teams still have a hard time maintaining (let alone increasing) their business partners’ satisfaction (source of survey). And, while there are some frustrated business partners that may think this is because of a lack of effort or a competency issue, I believe that is simply a larger problem with the nature of the IT industry as a whole.

Let us consider some of the more “disruptive” trends in IT since the mid-1990s.  I chose this point in time for two reasons:

1) Because it was around this time when nearly all businesses at least started to adopt computers and software to do manual tasks.

2) I started my IT career around this time, so I have first-hand experience working with these technologies.

A graphic to represent these (not when the inception date, but more the timeframe when most IT teams had to adjust normal workstreams to adapt to these technologies)

Early 90s:  Networking and LAN/WAN connected servers and PCs

Mid 90s:  Broadband/Internet connections for businesses /VPNs

Mid/Late 90s:  Virus scare and data security industry.

Late 90s: Y2K and Outsourcing

Early 00s: Dotcom Boom/Bust

Early/Mid 00s:  Server Virtualization

Mid/Late 00s:  Smart Phones

Late 00s:  Social media / BYOD

Early 10s: DevOps / Cloud Computing

Early/Mid 10s: Containers

Mid 10s: BlockChain technology/Ransomware

As mentioned before, I was part of IT teams that had to account for all of these disruptive technologies that were throwing new challenges at us, and some of the teams did well enough to implement a solution to the businesses that we were servicing; however, these implementations weren’t always “efficient” nor cost-effective, and I always wondered how satisfied our business partners were with our deliverables and also if the business could really handle the significant costs incurred by our IT teams’ inefficiencies.

Therefore, in this post, I am outlining the business case for MSP (and MSSP) when it comes to providing a more efficient delivery on the solutions required to efficiently take advantage of the current disruptive technologies, and even those legacy technologies that don’t get the attention needed from internal IT teams.

The first example of this is something as mundane and routine as data backups and disaster recovery. This is a critical part of businesses, but has your business performed its due diligence in this area recently? I know the last “event” that caused me to need a backup volume on a VM restored, it was a painful and lengthy process (with significant application service downtime incurred), and it certainly did NOT deliver the recovery point objective (RPO) that I was promised when I was discussing these RPO requirements with the storage team. Our combined apps/OS/VM/Storage/Network teams also didn’t perform enough regular recovery exercises prior to the “event” to have the process of recovery completely understood and were very inefficient at this. So, we all agreed that it was something that “should” be done more regularly and added it to the ever-growing list of things that the combined IT teams “should do.” I would imagine if you asked and received an honest answer from your IT team leadership, they could give you a large list of these types of “should do” lists, and I would also wager that practicing DR or performing any exercises of this sort would be on that list.  I would like to reiterate, I am NOT being critical of IT teams (or team members). I firmly believe this is the nature of IT teams and the constant demand on these teams, which cause these teams to focus mainly on the “must-do” list and only work in any focus on the “should do” list.

This is where the business case for an MSP and embracing the (X)aaS model can provide a huge benefit to any business with an unbalanced demand and deliver capacity ratio from their IT team(s). I like to fundamentally compare this to a “build vs. buy” decision for software development (does anybody remember when businesses tried to have a web-development team in-house?).

Let us consider that IF backups and DR did make it to the “must-do” list, I think this is a big IF with a low degree of probability of occurrence. But, for making the point, let’s follow a likely process for it.  First, a project would be budgeted, scoped, and staffed. The best case of this project scoping would be measured in multiple weeks. The products available for this solution would be another multi-week effort to evaluate, determine costs, etc. After this, there would be the project’s design, testing, and implementation phases, again taking multiple weeks to complete. So, in the best-case scenario, a business has spent months of time and paid for the following:  hardware, infrastructure, software licenses, as well as other less obvious costs (staff training, ongoing license costs, operating expenses, hardware depreciation, etc.)

Now, let us consider an MSP that provides Disaster Recovery as a Service (DRaaS) and what benefits that has to the business in three facets outlined here:

First, the MSP does this for multiple businesses and is staffed with expertise in this specific area. Again, backups and DR aren’t sexy to many IT staff members, so it usually doesn’t get much attention from the most talented IT staff.  This focus from the MSP allows the MSP engineers to innovate and research the latest and greatest products and offerings available in this space. These staffs are motivated by innovating in this space. The MSP model is less disruptive to the business and IT team cadence because the MSP can also focus and perform DR exercises with minimal impact on the ongoing business services and the IT teams.

Second, the MSP can leverage economies of scale for the software products and the infrastructure components. This model also allows the MSP to develop an attractive overall service cost to the businesses that enlist MSP for DRaaS. The predictable cost for DRaaS allows for more accurate Business/IT budgeting and a significant reduction in the overall costs of the backup/DR solution for that business.

Third, while considering the first and second facets, there is an advantage to both MSP and enlisting businesses, the model, expertise, and scale provide the MSP the ability to get premier tier support for any new product feature developments, rapid response for procurement, thus significantly reducing the time to fulfill this service to the business (as opposed to the IT team project scenario).

Since we’ve all heard the old engineering quip: “better, cheaper, faster … pick two”, in this MSP model for something as mundane (but nonetheless necessary and extremely important) as backup and disaster recovery, you really can have all three! The MSP DRaaS offering is really BETTER AND CHEAPER, AND FASTER for any business struggling with the nature of IT demand.

To explore DRaaS offerings, visit stninc.com and contact us today. We can have a conversation about your current backup/DR solutions and partner to provide your business a better solution.

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