Enterprise Insights

Blog archive

IT Pros Reveal Practices, Plans for Using Managed Service Providers

In a new survey of midsize and large enterprises (those with 1000 to 20,000 employees) about their use of managed service providers (MSPs), it’s clear that IT wants to get rid of some of their least-favorite chores. The most common functions outsourced by respondents were storage backup and recovery (56 percent) and service/help desk support (44 percent). The later topped the list of functions respondents are planning to move to MSPs, and twice as many smaller organizations are likely to make that change than large companies. Executives were 2.3 times more likely than their non-executive peers to be thinking about outsourcing storage/recovery management chores.

For those respondents currently using an MSP, virtual servers (68 percent), data center infrastructure (61 percent), and physical servers (56 percent) were in the hands of their MSPs.

What’s driving interest in such outsourcing? Cost reduction was the reason given most often (41 percent), followed by “access to greater technical expertise/depth” (37 percent) and “the ability to better focus on the core business” (36 percent). Executives favored accelerating cloud adoption and saving money by avoiding a capital expense. Non-executives were more likely than executives to be interested in cost reduction and off-hours coverage.

What’s holding enterprises back from fully embracing MSPs? Security risk (at 68 percent of all respondents) was the top issue mentioned, and nearly half worry about loss of control (this factor was favored by larger enterprises). Smaller enterprises tend to be most concerned about the uncertainty of cost and a lack of MSP responsiveness.

The survey of over 100 executives, mid-level managers, and “individual IT contributors,” was conducted in February and March by Enterprise Management Associates and sponsored by Nimsoft; it looked at how enterprises were using and are planning to use managed services providers.

Interest remains strong in MSPs. Storage and virtual servers tied (named by 51 percent of respondents) as the top technology their enterprise is planning to move to an MSP in the future. Executives were more likely than other respondents to consider every technology and infrastructure domain the survey raised, with LAN/WAN, physical desktops, and virtual servers among their favorites candidates.

When it comes to applications, MSPs are handling hosted applications (53 percent) and databases (50 percent). What applications will likely be operated by MSPs soon? Private clouds received 60 percent of the vote, tied with hosted applications. Executives are particularly keen on moving databases, SaaS applications, VoIP, and video.

Responses also varied significantly by the size of the respondent’s organization. For example, achieving improved focus on core business was twice as important for larger organizations than it was for smaller ones, while smaller organizations were 2.6 times more likely than larger ones to be looking to MSPs that could provide better coverage during off-hours.

As for selecting an MSP, respondents consider proven expertise and depth of expertise ahead of all other properties (66 percent), followed by reputation/references and service-level agreements (both at 55 percent). Enterprises aren’t limiting themselves to a single MSP, either. They’re looking for balancing risk with business continuity (73 percent) and having different domains and levels of tech experience (66 percent) by using more than one managed service provider.

-- James E. Powell
Editorial Director, ESJ

Posted by Jim Powell on 05/20/2011 at 11:53 AM