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No matter the size of the business, technology plays a critical role in its financial success. At the most basic level, companies have to deal with desktop and laptop computers for all their employees, e-mail, access to the Internet, Blackberries, and other kinds of on-site and remote devices.
Add networking issues like viruses, spam and bandwidth utilization, and suddenly, this effort becomes a major challenge to anyone operating a small or mid-sized business (SMBs) with limited resources and a limited budget. In today’s economy, small businesses’ primary differentiator is service. If systems are down, then customer service levels are down too, ultimately hurting the business, the company’s reputation and its bottom line.
This can make giving up control over critical information technology (IT) systems daunting. SMBs can learn from the Fortune 500 when it comes to letting someone else manage their technology infrastructure.
At its essence, “managed services” means subcontracting a process to a third party who handles all elements of the initiative, from strategy to execution and managing it all along the way. This differs in a significant way from outsourcing, which in many cases leaves it to the business owner to manage the project or issue.
A recent Gartner report issued in June 2008 in conjunction with the analyst firm’s Outsourcing & IT Services Summit cited IT managed service as a high-growth market, regardless of the economy. In fact, in a survey focused on large companies such as Google and Microsoft, more than half (55 percent) said they plan to increase their IT spending with external service providers this year.
So, what do large companies know about managed services that smaller companies don’t?
Where Does it Hurt?
The threats facing SMBs are everywhere, from the economy to larger competitors, to hiring and retaining the right employees, to finding and keeping the best customers.
When it comes to IT infrastructure, though, there are three big pains:
First, how does system downtime impact your company’s productivity? Industry analyst firm IDC estimates that server downtime alone cost organizations roughly $140 billion worldwide in lost worker productivity and revenue in 2007. How often is e-mail down? How many times do employees have to re-boot to fix a problem? Can remote workers reliably and quickly access critical information on the home server? How much of the workday do employees spend surfing the Web for non-work-related activities?
Second, how do business disruptions impact your ability to service your clients? Do you have the capabilities – and the bandwidth – to proactively monitor and manage your IT systems? Are your systems safe and protected? Can you look for signs of trouble before a breakdown that could negatively impact your customers?
And lastly, how much does IT really end up costing you? Do you have a full-time employee who handles everything? Or perhaps you use a contractor or small firm on an hourly basis. Is that cost predictable over time? Are you able to foresee and plan for upgrades and new equipment as new people join your firm or your company’s needs change?
IT Managed Services: Benefits to Small and Mid-Sized Businesses
While there are no doubt many ways to quantify outsourcing IT, there are four key takeaways that are unique for SMBs:
Company Performance Improvements
One business axiom making the rounds is “Fake it ‘til you make it.” For an SMB, your customers expect – and demand – a professional interface, whether it’s e-mail, e-commerce transactions, data-sharing between partners, or even Web sites and invoicing. All this boils down to having the right technology infrastructure to make SMBs look like bigger companies while maintaining the benefits of being a boutique or small organization, with a stronger focus on customer care and client relationship-building.
Take, for example, New York-based Iron Bridge Consulting. Iron Bridge professionals handle every aspect of the design, development and execution of opening a new top-notch restaurant, commercial building or high-end residence. From the moment a project is initiated, Iron Bridge handles lease negotiations, hiring architects and civil engineers as well as enlisting a solid design team ensuring success for aspiring business owners.
With clients like Sushi Samba, Charlie Palmer Group, David Burke and other star-studded locations, Iron Bridge must look, feel and act like the professional organizations it services. Iron Bridge’s commitment to client satisfaction means it must deliver on its promises, while improving employee productivity, minimizing IT costs and maintaining system availability.
“Our business is about making development projects run smoother,” according to Steven Magnus, principal for Iron Bridge Consulting. “Our IT system needs to be sophisticated, reliable and most importantly, non-disruptive. Quite simply, downtime is a nightmare for our daily business.”
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