Better served, better business

Managed services have become a mainstay of enterprise IT. But recent months have shown that service providers are the grease that has kept the wheel of business turning throughout troubled times

5th July, 2020
If business continued at all in recent months, it was because information and communications technology (ICT) allowed it to

If business continued at all in recent months, it was because information and communications technology (ICT) allowed it to. From remote working to collaboration to things the public is entirely unaware of – such as distributed contact centres – it was our computing, networking and storage that kept us going.

Behind this, though, there is a more complex picture. Why were some businesses better able to cope than others?

Apart from obvious examples where work was forced to come to a halt due to social distancing regulations, such as manufacturing and in-store retail, IT capability was also a clear issue.

“Even five years ago this would have been an absolute disaster,” said John McCabe, managing director of Damovo global services and Damovo Ireland. He gave an example, and it was no small one: an American insurance company.

“We were able to move 3,500 people at one of our clients in the US, over one weekend, to working remotely,” he said.

This client in particular is interesting because it was not only large, but it had a significant amount of traditional infrastructure managed by Damovo, so it wasn’t a simple question of telling people to log into the cloud from home.

“There was a lot of on-premise, but we were able to flip it and set it up remotely, as we run their whole IT function,” said McCabe.

Will that company go back to on-premise infrastructure or will it, having experienced hosted services, albeit not in circumstances of its own choosing, seek to extract maximum benefit from it?

If the latter is the case, then lower estate costs – assuming rental contracts can be negotiated – are one area that might be targeted.

“Factories are different, the manufacturing environment is more complex. For offices, things will now change. Even in my office here in Dublin I can probably reduce my office footprint by 50 per cent – and, talking to various guys in the US, that’s exactly what’s going to happen,” said McCabe.

Tadhg Cashman, services director at Logicalis Ireland, shared similar experiences with Connected: when the coronavirus pandemic first took hold, the landscape changed overnight.

“The government locked down and everyone had to transition to 100 per cent of their workforce working remotely. That was a major issue,” said Cashman.

“It caused a number of our customers to recalibrate their IT infrastructure to accommodate that level of remote working. We had one customer with hundreds of staff who were predominantly office-based and, overnight, they had to rearchitect their IT infrastructure. It caused a major bottleneck on their VPN infrastructure and in their core infrastructure, but we scrambled a team to allow it to work."

The result was positive and after an initial rush things settled down. Uncertainty remains, though.

“There was an initial quick assessment of where everyone was, and once it settled down and remote working was enabled the focus changed. A number of projects and investments were put on hold or deferred and I think the landscape changed the priorities for the chief information officer for the year ahead,” Cashman said.

This uncertainty is right across all industries and sectors, as we just don’t know what the world will look like three months hence.

“The pandemic did cause disruption to the business community and to IT,” said Cashman. “From our perspective, it had an impact on field service.”

As managed services have allowed firms to continue doing the business of business, there are signs that the sector itself will grow as customers come to rely on it more and more, principally for reasons of stability.

“One of the interesting things is that our remote managed service capability and our managed service business had been very resilient. We know that customers do rely on external specialist service providers and we think it will drive an even greater requirement for external service providers,” Cashman said.

Helping hand

If managed services are a way of helping businesses run and control their IT systems, then it is perhaps unsurprising that one IT function that is a popular choice for contracting with a managed service provider is helpdesk.

As anyone who has ever been dragooned into providing unofficial tech support will know, users are a lot less tech-savvy than they tend to think they are.

As a result, in any organisation, ironing out the daily wrinkles – as well as dealing with full-blown problems – can soon come to consume all of the IT department’s time. Obviously this situation is unacceptable, and yet users need and deserve help all the same.

John Bergin, managing director of IT Force, said that his company’s outsourced helpdesk does a lot of work in industries where downtime is not an option.

“For us, the kind of companies taking helpdesk are financial services and professional services like accounts and solicitors,” he said. “We may not be typical of a managed service provider as we do a lot of background stuff; we have a lot in there like change management, for example.”

Bergin said that the stresses and strains endured in recent months will cause a realisation that IT matters.

“People are really beginning to realise that due to the madness that started ten or 12 weeks ago, in some respects IT has saved the day. At the very least it has raised the profile of IT once again,” he said.

The approach that needs to be taken has to go beyond simply fixing problems, though. Instead, said Bergin, a strategic view has to be taken, one that considers the preparedness of the overall system.

“A lot of companies see IT services just as break-fix. This last 12 weeks has helped them see it’s a lot more strategic than that,” he said.

“One of our very good clients came to our offices because he had to collect laptops from us to hand out to his workers. I also talked to some of the opposition, and they told me that some businesses were at sixes and sevens.”

This varying level of preparedness tended to correlate with the level of engagement with service providers, which in turn can be seen as a scale measuring how seriously IT is taken in a business.

“It was interesting to hear it. I don’t want to wish ill on anyone, but what you get out of IT is related to what you put into it. It’s not that we’re looking for garlands of roses, it’s just that the kinds of things that are possible shone out in the last 12 weeks,” said Bergin.

What things, exactly? Bergin said that beyond getting up and running with remote working, there was a noticeable series of waves, with demands coming in phases.

Throughout the month of march IT Force’s clients were in constant contact, and IT Force was communicating important messages, too. “People were working from home and we were sending out things about best practice, security, the kinds of phishing attacks to expect and so on,” Bergin said.

A month later, as people settled into the so-called new normal, things became normal – or normalish at least.

“By the middle of April it started to change a little. People were setting up VPNs and so on, and then they were just getting used to them. Even with smartphone technology and the likes of Microsoft Teams, people were struggling with that,” said Bergin.

This adjustment phase typically lasted until the end of April. Bergin said that this makes sense, but that another change is now under way and businesses are seeking support through it.

“Then it went quiet, but it’s starting to ramp up again as people start to open up offices,” he said.

Everything that’s fit to print

The classic managed service, and the one that most businesses will be familiar with, is print. Whether it’s in the form of photocopier leasing or contracts for multi-function devices (MFDs), managing print has meant continuity of service and control of costs.

It also has the not insubstantial benefit of keeping printers out of the hair of the IT department. Other issues have come to the fore in recent years, though, said Daniel Rafferty, channel sales manager at Epson Ireland. One is environmental consciousness.

“The key to what we do is that we base everything on business inkjet. It’s low energy, lower CO2, and also you have very low intervention,” he said.

“Sustainability has become a more important element and that’s being driven by government and filtering down to business level. Unlike with laser printers, we’re not heating up an oven; we use up to 90 per cent less energy than a laser printer.”

Managed services haven’t quite reached down into the consumer market, but with more people working from home it is possible to add smaller devices to contracts and have them sent out.

At the same time, Epson has been moving away from the old ‘razors and blades’ model of subsidised printers paid for with ink sales.

“About three years ago we launched a new range of printers for the consumer market called EcoTank, that come with two to three years of ink in the box,” said Rafferty.

Epson has also launched a subscription programme for home use called ReadyPrint.

“People have been generally purchasing the EcoTank. ReadyPrint is very new, [and] they can of course also add the devices on to their managed print contracts,” Rafferty said.

Epson’s contracts include Print365, an all-inclusive package where everything is managed by Epson, but there are also other models.

“We have ‘Print and Save’ where we do the page monitoring and accounting and bill the dealer, who then deals with the customer,” said Rafferty.

Both business and home users are price sensitive, of course, albeit expressed in different ways with businesses preferring a predictable billing cycle. Rafferty said, though, that there is another issue: making sure everything works smoothly.

“The price is still very important, it’s perhaps the most important factor, but reliability is an issue too. People hate printers, so if you can produce a device that requires less intervention or can be managed efficiently by someone else, then that makes them happy,” he said.

Contract duration varies according to need, with some clients opting for three-year contracts and others, often buying though channel partners, choosing a five-year duration.

“That will normally depend on the uses the customer will get out of the device. If you have a customer doing a million pages a month, you have to make sure they get a device that can handle that,” said Rafferty.

This is achieved through auditing, where printers are monitored for one to three months to understand usage patterns. What is being printed is also significant: typical office printing is a world away from graphic arts and in-store graphics.

“You have the photographic reproduction market, the technical drawing market – CAD and maps – and these are not traditional managed print, but it is a quasi-managed service,” said Rafferty.

Unpredictable volumes and even more unpredictable page coverage are the issue here.

“In the graphics market you might have 60 per cent coverage of the page one minute and five per cent the next for, say, a CAD drawing. That can be a challenge when it comes to pricing per page. One of the challenges was found to be bookmakers. They print a [football] pools sheet every day and would have 60 to 70 per cent coverage on the page,” he said.

The move to bring enterprise managed services to the home has also caught the attention of HP.

“Expectations around serviceability are evolving, with most people now expecting the same level of service at home and on the move as they did from a traditional office setting,” said HP Inc country manager Ireland Neil Dover.

“That’s a major challenge for a lot of IT departments, which are typically overrun with requests for updates, new devices and break fixes. IT resources are often wasted on trying to maintain a fleet when their skill sets should be redeployed to focus elsewhere.”

Oki has been promoting full-colour graphic printing in retail for some years and has found its clients now need to produce coronavirus social distancing signage

“We do offer managed print for retail. It depends on the coverage and volume, but we can do bespoke contracts,” said Simon Martin, sales manager at Oki Europe.

“We have a toolkit that people can download and can supply the media, so you get things like stickers for the floor with footprints on them. All of that can be put on to a managed print contact.”

For Oki this wasn’t driven by the coronavirus pandemic per se, it was a retail graphics plan that was already in progress.

“This could develop into other solutions and other media offerings. People are looking at the circular floor stickers and someone put an image of a Dairylea cheese on it. If brands are looking to do that sort of thing, we can help them.”

Retail print management is necessarily different from office, though. For a start, it’s a lot more unpredictable.

“We always start with the question, ‘What are they looking to print?’ We do have standard price lists, but what we’re looking for is to have conversations with retailers,” said

“For example, there’s a couple of independent booksellers we’re working with who want to use the cover images. There’s a lot we can do and we’re not going out with specific, fixed offerings.”

Managing the network

Michele Neylon, chief executive of Blacknight Solutions, said that one of the key advantages to engaging with a managed service provider is bringing expertise to the table.

Nowhere is this more obvious than in the networking space, where resilience is essential, security is paramount and where basic functions, such as backup and disaster recovery, are often left to languish.

“The thing is, with managed services, back in the day some companies were being sold office server boxes that sat under a desk. I suppose at the time it kind of made sense, but it really doesn’t now,” said Neylon.

For Neylon, the issue is that IT staff and budgets are often stretched as IT is seen as a cost centre rather than a core business function.

“We’ve seen companies expand and grow but they often don’t expand the IT support team, so you have one to two guys running everything. We’ve got the staff, it’s all we do,” he said.

The recent lockdown, whether it was felt as a rude awakening or not, has thrown some light on how IT can and should be managed, he said. The surprising complexity of network services, often hidden, is now in plain sight.

“It might have made sense for a small- to medium-sized company to do a lot of that stuff themselves, but especially now with so many people working online you’re going to have enough to do just keeping their desktops, laptops and phones running without getting into running servers – and the services that run on those servers, which have grown more complex over the years.”

Neylon’s fear, though, is that IT will be seen as fair game when it comes time for cuts. The opposite approach should be taken, he said, with strategic investment being made.

“If you look at this crisis, people were asking what areas of the business had to contract – and immediately ‘non-core’ comes up: non-core functions, non-core departments, such as marketing and IT,” he said.

“Personally, I think that’s a very dangerous thing to look at doing, but it is the very ‘easy’ route a lot of businesses take. Instead, you should be doing the opposite: you should be doubling down on it. But IT is not revenue-generating so it’s an easy target.”

Naturally the IT giants are players in the managed services arena.

Greg Dresser, services account executive at Dell Technologies Ireland, said that services have become more important because of the pandemic, but that it has confirmed an already existing trend.

“The market has definitely moved to remote working, but also to management and automation,” he said. “From our perspective, managed services is [a] part of our portfolio and we provide infrastructure, as well as services to manage that infrastructure.”

Dell also seeks to use the knowledge it has developed in-house, he said.

“Dell has 140-odd thousand employees globally and 35,000 services personnel. We’re able to leverage a lot of our personnel across the board and we have a lot of tools that allow us to not only monitor, but also intervene, not only in the data centre but also at the PC.”

Some areas like backup, disaster recovery and storage are obvious choices for managed services as internal IT departments have often struggled with them. But others depend on the needs of the business.

“Deciding what can be put into the cloud and what needs to stay on-premises is a discursive process,” he said.

HP’s Neil Dover said that the goal is for ‘as a service’ offerings, such as those of ‘device as a service’ (DaaS) or print as a service, to take the pain away from IT departments and increase the benefits to the end user – and this is more difficult than ever with remote working.

“Our services are centred on being proactive and establishing a predictability in regard to our fleet management. Predictability means that often an issue can be resolved before it becomes a problem. We’ve integrated AI and analytics to improve that predictability and remove the pain from IT departments,” said Dover.

For the user, this should translate into more up-time and devices that are constantly operational. “Rather than wasting half a day with IT trying to get your email back, the device is either swapped out or fixed before the problem occurs,” he said.

Beyond the phone

The skills shortage, particularly in IT security, has long driven the move to managed services. After all, security professionals are like gold dust and, with our increasingly online world, the need will only grow.

One estimate – and pre-pandemic at that – said the number of unfilled vacancies will hit a staggering 3.5 million by 2021. Today, though, adding new functionality is also an urgent requirement.

“Look at voice and video,” said Damovo’s John McCabe. “That has really ramped up. It’s subscription-based and it’s going to get bigger and bigger.”

McCabe said that the drive toward unified communications (UC) was not only essential to keep working, it has also meant that collaboration has increased.

“Communications and UC would have seen some hesitation in the past. That has changed. Everything is done over video, everyone is done using unified comms. It has taken a while to get used to, but I have people all over the world and I’m talking to them a lot more, for whatever reason.”

Keeping lines of communication open has undoubtedly been aided by the simple human desire to stay in touch. “I’ve never seen the use of video like we see now. The reluctance to use it is gone. Even in our personal lives we’re doing it,” McCabe said.

Of course, ad-hoc communications thrown together using email and endless phone calls make replicating the workplace environment that much more difficult. “Emails are not going to cut it. With unified comms you can collaborate, work on the same document at the same time, all of that good stuff,” said McCabe.

Holdouts such as the public sector, which often has to work a lot harder to justify IT use, have switched from the desk phone to full-blown UC. “They’ve had to work from home [too] and people who’ve had a phone on the desk are facing that change,” he said.

This may be an uncomfortable process at first, but it also creates a wide range of options for communication and collaboration.

Damovo deploys and integrates software such as Zoom, Microsoft Teams and Cisco Teams. “They get everything; the ability to communicate by voice, by video, to share documents, whiteboards… it makes your workers more efficient as they have one place they can go,” said McCabe.

More broadly, McCabe said that as managed service providers deliver a wide range of services to clients, the complexity should move from the business to the service provider.

"It’s really important that someone is managing it for you. It’s not just network issues: there is also on-boarding, defining people’s access to certain files, how do you provision them.”

The first thing to do is to define requirements. After that, a managed service contract needs to be reviewed regularly to see if it is meeting the demands of the business.

“We would have regular quarterly business reviews with senior management, monthly reviews with the technical side; understanding where these businesses are going,” said McCabe.

As a result of these meetings, McCabe has seen how different sectors and industries have been able to deploy managed services to keep the show on the road. Of course, for some, with core business effectively banned, no amount of IT services would save the day, even if they could help manage the fallout.

“Some people have more business now than they did before Covid. Food is really ramping up, for example. Others like airlines and aviation, well, we can see the damage that’s occurred there.”

The history of managed services

Managed services predate IT as we know it, starting with the humble – or perhaps not so humble – photocopier. These devices revolutionised office work, banishing carbon paper to the history books, but they were expensive and required regular maintenance.

As a result suppliers, such as what was then called Rank Xerox (a joint venture between imaging specialists and the J Arthur Rank organisation, better known as a film company), leased devices to businesses for a fixed cost.

By the 1990s as IT infiltrated the workplace, a similar model had become common with office printers, which, in turn, would soon compete for the exact same contracts as the copiers.

Also in the 1990s, with the IT maintenance burden growing, businesses started to look at general ‘break-fix’ IT contracts, essentially having a service provider come in to repair or replace infrastructure, such as workgroup servers.

The problem here is one of value: if nothing breaks then you’re paying for nothing, but then budgets could be blown in a single bad week. At the same time IT complexity was mushrooming: the internet was here, and businesses were connecting to it.

Suddenly, servers had to be a lot more powerful and security was now a major concern. As the 2000s wore on, it became more and more common to outsource sections of IT functionality in return for a regular fixed fee in return for a service level agreement.

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