Managed services providers help organizations adopt advanced technologies without misgivings.
Global IT spending will exceed $4 trillion this year as organizations continue investing in sophisticated solutions to help them remain competitive in a rapidly evolving technology and business environment. A surprising number of those organizations are likely to experience buyers’ remorse, according to a new study.
In a recent Gartner survey, 56 percent of organizations reported a high degree of regret over their largest tech-related purchases over the past two years.
Hank Barnes, distinguished VP analyst at Gartner, said those most likely to regret their IT purchasing decisions share some common characteristics. Most of them have a dozen or more people involved in the decision-making process, leading to internal conflicts about objectives for the purchase. Many also have high levels of internal resistance to change and tend to delay purchases while wrangling over relatively minor decisions.
“There can be significant downside to regret associated with enterprise technology decisions. The survey found that the organizations that indicated they had high regret for their purchase took on average seven to 10 months longer to complete that purchase,” said Barnes. “Slow purchase decisions can lead to frustrated teams, wasted time and resources and even, potentially, slower growth for the company.”
How Managed Services Can Help
Managed services arrangements can avert many of these challenges. Very often, MSPs can deliver services that many organizations are unable to achieve on their own. Providers typically have access to best-in-class tools and processes that they can leverage on behalf of their clients. In addition, MSPs have highly skilled staff who are experts in managing complex technologies.
Increasingly, MSPs are also offering IT services and solutions on a subscription basis. The pay-for-use model eliminates much of the apprehension, indecision and regret that big-ticket technology purchases can foster. It also allows organizations to take advantage of technologies they might not otherwise be able to afford, and try new solutions with less risk. In addition to eliminating upfront capital expenditures, managed services providers (MSPs) speed deployment of sophisticated solutions to improve time to value and drive growth.
Providing AI/ML Expertise
Artificial intelligence (AI) and machine learning (ML) are areas where MSPs are increasingly proving their value. While organizations are eager to exploit these technologies, they’ve had little luck on their own. In a study from Vanson Bourne, 93 percent of U.S. and U.K. businesses consider AI and ML projects to be business priorities, but 51 percent acknowledged they don’t have the in-house talent to bring their strategies to life. That contributes to a high failure rate for these projects. According to two recent Gartner reports, 85 percent of AI and ML projects fail to deliver expected benefits and only 53 percent make it from prototype to production.
Meanwhile, managed services providers have been steadily investing in the tools and expertise required to add AI, ML and other premium services to their traditional services, such as network monitoring and administration, help desk, and device management. Providers can work with customers to plan, design, build, manage and optimize AI/ML solutions. In particular, MSPs can help organizations collect and annotate data, monitor key performance indicators and manage workflows.
Assisting with Digital Transformation
Cost reduction remains among the key benefits of managed services — Deloitte analysts say managed services can reduce IT costs by 40 percent by reducing infrastructure and staffing expenses. However, cost reduction is no longer the primary driver for managed services. Many organizations are now primarily concerned with finding a strategic partner to support their digital transformation efforts with cloud migrations, data analytics, process automation, supply chain management and other advanced services.
Moving apps and services to the cloud helps provide the agility and flexibility that are necessary for digital transformation. In a recent Cloud Guru study, however, more than 80 percent of IT leaders said that a lack of in-house knowledge and skills has become a barrier to cloud success. MSPs have expertise with specific cloud environments, such as hybrid cloud and multi-cloud, or specific projects, such as migration, cloud cost management, performance optimization, security and compliance.
Supporting Modernization
Network modernization is another area in which MSPs can help. It is estimated that nearly three-quarters of U.S. companies are now using Software-defined WAN (SD-WAN) solutions to facilitate network connectivity to mass numbers of mobile and remote employees. However, these solutions require specialized expertise in WAN optimization, traffic steering, telecom services and more. More MSPs now offer fully managed SD-WAN solutions that deliver all the benefits with none of the management headaches.
Many MSPs can also assist with application modernization. Whether migrating old apps to the cloud, switching to cloud-native apps or developing new custom apps, modernization is a time-consuming process requiring special skills. Leading MSPs have the expertise in software development and cloud platforms necessary to make changes that support the business, improve efficiency and enhance security.
“Choice-overwhelmed customers need help determining the best solution for their business needs out of hundreds of look-the-same, sound-the-same online marketplace applications offerings,” said Carolyn April, senior director of industry analysis at CompTIA. “An MSP’s consulting influence can cement a trust and stickiness with customers that can be both lucrative and valuable.”
