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A Managed Service Antidote to Organic IT

The accelerating Organic IT phenomenon is being driven by executive frustration that today's business technology demands are not being fully met by their internal support organization. Some IT teams, however, have taken decisive action to free-up time to become more responsive to their savvy user's requests for new capabilities.

Perhaps that's a key leading indicator why remote managed services have emerged as a rare growth area within this tough economic environment. Clearly, proactively increasing business process agility and cutting operational costs has never been more popular.

As a result, annual spending on remote managed IT services by the North American Small and Medium Business (SMB) sector is expected to increase 3.3 times in the next five years. That represents a compounded annual growth rate of 28 percent, according to the latest market study by AMI-Partners.

Extracting Value from Business Technology
"While SMBs have been steadily increasing their reliance on IT over the last several years, they have always been challenged in managing their growing IT infrastructures. The severe economic conditions of the last one year have forced SMBs to look for more cost effective ways to manage their IT. Remote managed services offered by 3rd parties provide 24/7 availability of critical IT infrastructure -- without increasing the need for internal IT staff," according to Anil Miglani, SVP of IT Infrastructure and Managed Services at AMI.

Apparently, SMBs increasingly use remote IT services to selectively out-task critical areas like security and storage, while others are now extending the use of remote services to manage PCs, servers, networks, communications equipment and various other business technology devices.

Yet, many more businesses could benefit from a managed service solution. "Of the total installed base of 60 million PCs and 8 million servers in North America, only a tiny fraction is currently managed remotely," says Miglani.

Enabled by Cloud-Based Infrastructure
Managed service providers are increasingly offering remote managed services to better serve their customers with fewer resources. While some deliver remote services from their own infrastructures, others have started relying on cloud-based infrastructure solutions.

"By using automated software to remotely monitor and manage their customer's infrastructures, solution providers have increased their productivity while also improving their service levels," according to Melissa Chong, Senior Research Analyst at AMI and chief architect of the study.

The potential growth of this market is also attracting several new types of providers like telecom companies, IT vendors, distributors, retailers and online resellers in the SMB IT services market -- currently dominated by local channel partners.

Given the diverse nature of the SMB market, AMI believes that vendor channel partners will continue to play a critical role, as more IT organizations willingly embrace the out-tasked managed service delivery model now -- rather than react after Shadow IT has taken hold.