Business Technology Roundtable

Hiring a managed services provider shouldn't be a leap-of-faith decision-making process. Perhaps you have staff that could fulfill their responsibilities, but instead you entrust a key component of your IT infrastructure to another company. You believe they can do the job better and more efficiently. However, is that belief proven to be justified? This begs another question: who licenses or certifies a managed service provider? The topic came onto our radar thanks to a handful of companies claiming SAS 70 certification. The SAS 70 standard was developed by the American Institute of Certified Public Accountants (AICPA) to govern service organizations. (SAS stands for statement of auditing standards; see the AICPA page relating to auditing standards for more information.) Certification's Real Meaning You may assume that a managed service provider claiming SAS 70 certification has submitted itself to rigorous tests relating to its internal processes. However, according to Judith ...

Business leaders are still upbeat about the benefits of technology adoption. It's key to their market penetration, central to competitive differentiation, and vital to their supply chain and distribution strategies. However, according to Forrester Research, they are less than satisfied with their own IT organization's contributions. In fact, reducing the cost of operations is believed to be one of the few attributes where expectations are aligned. Members of the Forrester Leadership Boards (FLB) CIO Group recently discussed this challenge. Forrester presented results from their business technology survey of 600 executive leaders. The study uncovered the following significant gaps: IT teams rarely are aligned around key business priorities. When asked to rank business drivers by their importance to the firm's technology strategies, business executives identified customers, productivity, and costs as the most important themes. But, when asked to rate their IT organization ef...

We spend considerable time educating businesses about the value of managed service providers ( MSPs ). Now it's time to tackle the next logical question: Assuming you're ready to outsource some or all of your IT infrastructure, where can you find a qualified, reliable MSP ? The search for an MSP that fits your business is a bit like finding a doctor: There are thousands of qualified people ready to help you, but ultimately your choice may come down to personality and bedside manner. In some cases, MSPs may serve as a virtual extension -- or complete replacement -- for your IT department. With that reality in mind, your service providers will need to have corporate cultures that blend well with your own business culture and working style. Treat your search for an MSP similar to an employee search. Interview the candidates carefully, ask about past successes and failures, and ask for plenty of references that you can contact directly. Step One: Finding MSP Candidate...

The business case made the argument for Kline & Company , a management consulting and research firm about to celebrate its 50th anniversary, to investigate hosted videoconferencing. A global company, it handles approximately 40 projects at any given time. Three to six people collaborate on each project, which last three months on average. About three-quarters of its projects are global. To collaborate and share knowledge, team members confer approximately 20 times over the duration of a project. That's thousands of in-person meetings over the course of a year, between colleagues and clients who are unlikely to be in the same location. The cost -- both financially and in terms of time -- was becoming prohibitive. Serving Client Needs Companies benefit from management consulting firms' insight because of their aggregated experience. But that insight needs to be shared because not every consultant can join every engagement. That's why John Hadley, Kline’s director of IT, i...

Novell has canceled BrainShare . Apple is ending appearances at MacWorld . And thousands of businesses continue to cut their travel budgets for 2009. I've got some unconventional advice for you: Stay on the road in 2009, and make sure you're meeting face-to-face with your best business prospects and sales leads. I plan to be on the road at least 40 to 50 percent of the time in 2009. But on the other hand, our business continues to embrace a range of online technologies that drive conversation and collaboration with employees, customers and partners. Here are five options that can enable your business to save money and cut travel costs in 2009. 1. Hosted TelePresence : Yes, TelePresence (next-generation video conferencing) is a great way to drive communications. But building out TelePresence studios (they resemble executive boardrooms for the digital age) can cost $300,000 or more. Lower-end TelePresence solutions can cost about $12,000 and prices continue to fall. Still, you ca...

If you've ever had to add or move employees, you know that one of the biggest hassles is dealing with the telephone system. While many companies are deploying IP-based phone systems to ease their PBX hassles, still others are turning to hosted phone systems to eliminate their ongoing operation and management responsibly altogether. Hosted phone systems work especially well for companies that have highly mobile employees. With a hosted system, employees can just log into the system to automatically forward calls to another designated number. One big advantage: employees need only give their clients one phone number. This eliminates the complexity of dealing with multiple phone numbers and voice mail systems. Helios Realty , part of Real Living, the Midwest's largest independent real estate firm, has taken advantage of this concept. Helios relies on Cisco-Powered partner Geckotech to provide a scalable voice and data infrastructure for its highly mobile workforce of real estate ...

I received an email the other day congratulating me on a column I wrote for NetworkWorld nearly three years ago entitled, "Why Managed Services Fail." The 'shelf-life' of web content always amazes me, but it is gratifying to have people stumble across my past writings and still find them timely. What struck me as I revisited this 2005 column was how many of my points were still true, "...Almost every supplier and service provider I talk to admits that selling managed services has been harder than expected." "The first problem these managed service providers face is packaging." "The second issue is pricing." "The third challenge is positioning these services properly." "But the biggest obstacle to selling managed services is poor sales skills." Sound familiar? Although industry research clearly shows that customers are becoming more receptive towards managed services and the economy is even driving an increasing numbe...

All business has become global. Companies of any size can now market products and services worldwide over the Internet. At the same time, competition has intensified because customers can investigate global competitors with ease. To compete effectively in the global networked economy, companies need new capabilities: Global procurement and sales 24 hours a day. Integrated internal and external business processes. Up-to-the-minute access to sales, order processing, production, and other business critical information required for informed decision making. Flexible processes that can adapt dynamically to changes in the business climate. The application of Business Technology is now a primary enabler of strategic advantage. However, chief executives have become impatient, as their companies have failed to keep pace with these advances. There are alternatives, for those who choose to act. The managed services model can be applied to accelerate this much needed change. Review the following ...

There's a touchy little secret about call centers: their employee turnover is atrocious; it can reach as high as 26 percent per year, according to one expert's estimates . As a result, companies strive to ease the stress of their customer service agents. Continental Airlines , the fourth largest airline in the U.S. with $14 billion in revenues, realized that by deploying VoIP technology with personal computers, it could route reservations calls to agents' homes. This not only reduced the need for call center real estate, but it also gives reservations agents the ability to both telecommute and time-shift their work. Today, almost 1,100 agents work at home. Turning To Videoconferencing Technology Unfortunately, even good ideas sometimes have bad side effects. Continental found that they could easily keep employees up-to-date on staff issues with regular teleconferences. But for training and evaluations -- activities that required visual interaction -- agents still had to get...

While traveling across North America in recent weeks, I've heard about the same two-part trend from multiple sources: Some small businesses are reducing their IT service contracts and delaying outsourcing decisions. But on the flip-side, mid-size businesses are accelerating their move to managed services . These trends are pretty easy to explain. Consider this: 18 percent of small-business owners in October said they were at risk of going out of business because of economic conditions, up from 9 percent in August, according to an American Express survey involving 602 businesses with 100 or fewer employees. Even worse: 79 percent of small-business owners said sales are decreasing. About two-thirds of the respondents said the tightening of credit has affected their business. 51 percent said they have had to tap personal assets in order to pay business expenses. With those concerns in mind, it's increasingly difficult for small business owners to focus on their IT strategies. The...

New studies demonstrate the pros and cons of Business Technology deployments, especially as they relate to IT investment strategies. First, the downside: in a recent study of IT management excellence, the results showed the continuing disconnect between finance and IT roles, and the value each one brings to the organization. As the report states: "The lack of alignment within organizations is exacerbated by a lack of awareness on the part of both IT and finance about their own contributions to the problem. Nearly one-quarter of the respondents report that discord between IT, business, and finance is a frequent occurrence when making IT investments." Why Clear IT Processes Matter Lack of alignment is triggering a bigger cascade of problems relating to IT investment. For instance, sometimes companies excuse their lack of IT investment due to limited budget and resources. In reality, "companies are unsure how to define or implement management processes, therefore they are u...

I'm going to pull a Paul Harvey on my colleague Joe Panettieri. He wrote a couple of weeks ago about the managed service offerings of companies such as Verizon and Cablevision. For those readers outside the U.S. who don't know radio commentator Harvey, one of his catchphrases is to talk about "the rest of the story." In this case, it's the number of global enterprises who are signing deals with carriers to manage their networks. Since the time of Joe's story, there have been at least five announcements by major U.S. or global entities opting for large managed services contracts -- and those represent only the customers who were willing to announce the deals. The first deal to catch my eye was Indianapolis Power & Light's three-year contract with AT&T for integrated network solutions between multiple offices and generation plants, announced November 24th. Now, managing a network in central Indiana may not seem earth-shaking, but IPL is a subsidia...

There's a new term in the managed services space -- Desktop-as-a-Service (DaaS), and it's an obvious extension of the SaaS model. Desktone is a company that provides DaaS capabilities to service providers. Its customers, according to CEO Harry Ruda, currently include Verizon and Softbank Telecom. Ruda characterizes DaaS as a service whereby users obtain their computing services through a remote connection over a network. The physical compute power, if you will, is delivered through a service provider and paid for on some usage basis. In other words, users can access operating system and applications through a completely hosted system, and the service provider would be responsible at the back-end for storing data, upgrading applications, updating virus protection, among other activities. Computing Power of a Utility It relies on the whole concept of utility computing, in which compute power is delivered the same way electricity is -- when you want it in a metered fashion. DaaS...

As industry analyst forecasts mount predicting the rapid growth of managed services, an increasing proportion of IT and business decision-makers are taking a closer look at how these alternatives can impact their operations. The challenge is effectively measuring the costs and benefits of these options. Gartner kicked off 2008 predicting, "By 2011, early technology adopters will forgo capital expenditures and instead purchase 40 per cent of their IT infrastructure as a service." And with today's unprecedented economy crisis, THINKstrategies believes the shift to managed services will be faster and more pronounced than predicted. As a consequence, every responsible IT and business decision-maker is obligated to carefully reassess their current operations and thoroughly evaluate all of the available alternatives to better manage their IT environments so they can better support their business objectives. Substantive Cost Comparisons However, many of the current methods...

Do you believe that the growth of managed services adoption will have little impact in the government sector, or other non-profit organizations? Think again. Let's consider the facts. Clearly, all organizations benefit from improving their processes. Government Insights , a global independent research and advisory firm, released a report focusing on Service Level Agreements (SLAs) and their use in managing the delivery of IT and network services. As IT and network technology are embedded further into business processes, the apparent need for productive cross-organizational partnerships becomes evident. The state of these Business Technology partnerships can be either an enabler or an inhibitor -- when negotiating an SLA. Demand for Service Level Agreements Organizations may develop SLAs with internal IT staff and/or with external IT service providers. In both cases they set guidelines and minimum standards for the delivery of IT services to the end-user community. Jan Duffy, resea...

As Thanksgiving approaches on November 27, many U.S. companies are heading into an extended four-day holiday weekend. If you're an executive or CIO ask yourself the following question: If your web servers, databases or network infrastructure failed over the holiday weekend who would you call for help? Despite the proliferation of smart phones and ubiquitous network services, many IT staff members are impossible to reach over holiday weekends. And commuting into the office for an IT or network emergency is the last thing most employees have in mind when they sit down for Thanksgiving turkey. Secure, Safe and Sound On the other hand, I will rest easy this holiday weekend because our company depends on multiple managed service providers (MSPs) -- a group of companies that remotely monitor, manage and troubleshoot our Web servers, databases and network systems. In most scenarios, our MSPs mitigate an IT or network issue before it becomes a major problem. We pay a flat monthly fee to o...

Our prior commentary on SaaS and Managed Services: Big Service Providers Plug In does a good job pointing out how various service providers are attempting to deliver a widening array of Software-as-a-Service (SaaS) solutions and managed services. This trend is being driven by two major forces. First, the commodization of traditional transport services. Second, the shift in customer attitudes regarding IT management. Service providers can no longer differentiate themselves based on the quality of their transport services. As a consequence, service pricing, customer loyalty and profitability of this mainstay business continue to decline. To compensate for this erosion of their traditional transport business, service providers are seeking to deliver a new generation of value-added services which can give them greater 'stickiness' with their customers. It's a Win-Win Scenario At the same time, customers are seeking to offload, or out-task, a broader assortment of IT managemen...

Quick: Name the world's most successful software as a service (SaaS) companies. Most readers will likely mention Salesforce.com ... then perhaps NetSuite, two key players in on-demand CRM (customer relationship management) and accounting software, respectfully. Salesforce.com and NetSuite certainly have momentum in their markets. But consider this: Big service providers and broadband providers like Cablevision and Verizon Business may be the best-kept secrets in both the SaaS and managed services markets. With each passing day, I notice big service providers launching more and more SaaS and managed services offerings. Increasingly popular options include: Managed and hosted unified communications Hosted Microsoft Exchange and IBM Lotus Notes Managed routers, switches and network infrastructure Increasingly, big service providers provide both the pipe (broadband) and the applications flowing through the pipe (email, groupware, CRM, enterprise resource planning, and so on). When Big...

My colleague, Joe Panettieri, reports that Dell has won its largest managed services agreement ever with the state of Georgia. This contract illustrates how Dell, and other technology vendors, are shifting their go-to-market strategies to respond to customers' changing IT management needs. Anyone who follows the technology industry knows that Dell has been struggling to keep pace with HP when it comes to computer sales. What few casual observers have recognized is how Dell has amassed a new set of remote management capabilities via a series of acquistions over the past year and a half. Why Managed Services Matter During that time, Dell has acquired SilverBack Technologies, Everdream, EqualLogic and MessageOne to serve as the foundation for a new portfolio of Software-as-a-Service (SaaS) and managed service capabilities . Dell understands that it will have a difficult time outpacing HP and other technology vendors on the strength of its products alone as laptops, desktops and serve...

Are you puzzled about how to choose the best-fit managed service solution for your particular business needs? As a basic guide, the following are three typical high-level scenarios for deploying managed network services . Scenario 1: Customer Owns Network and Shares Management Responsibility Companies that already have an internal IP network can continue to manage it while out-tasking the management of onsite equipment -- usually known as customer-premises equipment (CPE), used for the managed service (see Figure 1). The Roles and Responsibilities are as follows: Managed service provider -- Sets up, maintains, and administers the equipment needed for the managed service, including company-owned equipment such as servers. Company -- Managed service customer maintains and administers its internal network. Scenario 2: Service Provider Owns the CPE; Customer Can Share Equipment Management with Service Provider Some companies do not own a LAN, either because the location is new or the compa...

Companies with branch offices are facing a technology paradox: On the one hand, businesses are expanding their branch office locations by 6.8 percent annually. On the other hand, only 15 percent of those remote locations have on-site technology staff members, according to Nemertes Research. Those stats beg the following question: How do you empower branch office employees with the proper technology when you can't afford to staff those remote offices with more IT staff? The answer (as our regular readers already know) is managed services. Increasingly, companies are moving their IT assets out of remote offices and into either (A) a centralized data center or (B) an Internet cloud. The march toward centralizing and virtualizing IT has some benefits and some challenges. Next Generation Empowered Branch The good news: Centralizing applications and IT infrastructure can make networks easier (and less costly) to maintain. The bad news: Accessing centralized applications from remote offic...

THINKstrategies recently unveiled the initial findings of its fourth annual Software-as-a-Service (SaaS) customer survey , in conjunction with Cutter Consortium , which revealed that 63% of the responding organizations are using a SaaS solution -- almost double the 32% who were using SaaS solutions in 2007. Over the past four years, we have seen tremendous growth of the SaaS market spurred along by rising frustration with the challenges of deploying traditional software products and the hassles of keeping enterprise applications up and running. Our surveys were the first to find widespread interest and substantial adoption of SaaS in 2005. Changing workplace requirements have led to more workers needing to access applications and corporate data remotely, which has also led many organizations to adopt web-based SaaS solutions. The Shift Away from CAPEX But, the most important consideration has been the financial savings generated by shifting from upfront capital investments in perpetu...

Many companies find it expensive to keep up with new Business Technologies -- or simply prefer to devote their limited IT or Telecom resources to the core business, rather than routine ongoing network management. Managed network services can quickly enable your company to evolve , by giving business decision makers access to leading network technologies and management expertise -- without requiring high initial capital expenditures (CapEx), or ongoing investments in technology upgrades. Deploying a Managed Service Solution When a company subscribes to a managed service, a service provider manages the network equipment and applications on the customer premises according to the terms of a service-level agreement (SLA) established to meet the company's unique business needs. Some managed services are also hosted, meaning that the service provider hosts the equipment in its facility instead of the customer's, and delivers services to company employees over the Wide Area Network (WA...

At first glance, some small businesses are caught in a technology paradox: They need modern technologies to drive revenue higher. But they don't have enough cash to acquire that technology. A recent American Express survey found that more than half of today's U.S. small business owners are experiencing cash flow problems, reports StartupSpark.com . As a result, the top priority for most small businesses is maintaining current sources of revenue -- rather than building new ones. Have Your Cake and Eat it Too I say: Why not pursue both goals? Fact is, you don't need very deep pockets to leverage modern technology. What you really need is a predictable cost structure -- a way to know exactly how you're going to continue innovating without suffering from surprise IT costs. By now, you likely know where I'm heading: Predictable managed services contracts can help many of those worried small business owners get a handle on their IT costs. Our company, for instance, pays ...

According to a recent McKinsey & Company report, their research results demonstrated that the potential for managing servers and other IT resources remotely is essentially underutilized. However, changes in the current business environment will increase the adoption of this approach. Plato, a wise Greek philosopher, wrote about how "necessity is the mother of invention." Certainly, that perspective is equally valid today. The motivation for utilizing the resources of a service provider can be considerable. A case in point: Fortune 50 companies, with budgets of $2 billion, can save as much as $500 million of their IT infrastructure budgets. How, you may ask? Apparently, it's mostly from reducing fully-loaded labor costs. Evaluation of IT Assets and Liabilities McKinsey surveyed 141 CIOs at multinational corporations, and 34 percent of them said that they anticipate utilizing some infrastructure management services over the next three years -- which is an increase from...

I spent Thursday afternoon moderating a Webcast about the managed services industry. The discussion drove home the fact that small businesses will continue to embrace certain managed services regardless of the economy around them. My guests included: Gary Pica, general manager of mindSHIFT Technologies , one of North America’s top managed service providers William MacLeod, CIO, Accu-Sort Systems , a mid-size business that focuses on automatic data capture solutions Jim Alves, executive VP, product marketing, Kaseya Full disclosure: Kaseya sponsored the event but the Webcast did not involve any product pitches. Rather, we were exploring how small and mid-size businesses will depend on managed service providers regardless of the economy. MacLeod conceded that his company is "rethinking everything" -- nearly all IT projects and expenses -- during the current economic turmoil. But here's the interesting part: MacLeod mentioned several managed services that his company will co...