Tag Archives: managed service providers

Why are Companies Steering Clear of Managed Services?

Managed services has become quite a huge industry in the past few years as talk about how huge the benefits are quickly spread around. More and more businesses joined in and were quite happy with the results, knowing that they were getting the same service they’re looking for at a much cheaper cost.

manages services

What do managed service providers do? They basically take over some of a business’s regular functions, tasks, and responsibilities especially when it comes to IT-related processes. How does it help? Because you have someone else doing some of the basic stuff for you, your team is left with more time to focus on the more serious projects. This also means that you won’t have to hire as much people – someone else can do the tasks that they’re supposed to be taking care of.

Despite the huge success that manages services has shown however, more companies have been shying away from the idea, and for a lot of good reasons. Here are some of them:

ROI calculation is harder. Although one of the top reasons why businesses outsource their IT functions is the fact that it could actually be more cost-effective for them, companies are finding that they are having a hard time proving this. Although their overhead expenses are relatively lower, it is actually harder to compute for ROI when taking this route, which means that they are not entirely sure if the cost savings are worth the investment.

Security risks are high.This has always been one of the reasons why people are wary of managed service providers, and it still proves to be a top threat to this day. After all, allowing third parties to do the job for you would mean letting them into your system and giving them access to information that you wouldn’t normally share to outsiders. This ushers in the risk of information and resources to be mishandled.

Control over staff or operations is compromised.Because you have people who are not exactly in your payroll doing the job for you, there is also a huge risk that you lose control of how they do the job altogether. Especially if you’re the type of manager or business owner who like getting into the smallest details of the job, having someone else managing the people working on the project means that you will not be able to do so any more.

There is less need for it.The huge advantages that come with using cloud solutions has made it harder for managed service providers to stay on top. This is because cloud services give business owners and managers more control over their own projects as compared to signing up for managed services. So the same level of efficiency is acquired, with almost the same costs.

Seeing how long manages services have been around and how much experience businesses have had with it, it is safe to say that these businesses are starting to move onto better options knowing that outsourcing their functions also has its own set of flaws. These flaws may have been something that others can overlook, but for those who have chosen to keep everything in-house, the risks are just too great for them to handle.