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May, 2008
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A letter from the executive officeThe evolution of managed services
The continued evolution of managed services will soon make this dashboard scenario a reality for enterprises that want to have full control of a fully efficient and available IT infrastructure. This is just one example of the many new capabilities transforming the way enterprises are looking at managed services. And with service delivery now the key strategic imperative for successful enterprises, drivers for managed services have shifted from mere cost cutting and overall efficiency to business growth, time to market, skills shortage, compliance and managing IT complexity. At a time when Web-based application performance and measurement are critical to the health of enterprises' business operations and service delivery, managed services are helping the IT professional deliver the next generation of business applications to their organizations. The role of managed services will continue to expand as fully converged IP networking enables a wide range of network-based applications. The new wave of B2B and B2C communications will be much more complex than legacy applications, heaping more onto IT managers' already full plates. Meanwhile, managed services solutions will begin to move beyond technology management and tie in business process and business value, turning them into a strategic asset. For all these reasons, the difficult choice of in-house vs. managed infrastructure and networks is becoming easier. Enterprises are relying more heavily on managed services than ever before. The technology supporting managed services has evolved, and there is now less risk and more ROI. In fact, in 2008, 63 per cent of organizations plan to use some form of managed services, up from 46 per cent in 2007, according to Nemertes' newly released Advanced Communications Services benchmark. This increase is being driven in part by enterprises realizing that by selecting the right managed services provider (MSP), they can retain a great degree of control over network and application performance, even for out-tasked applications and services. And the ultimate result is an increase in quality of the end-user experience. In this issue of Impact, we'll look at how enterprises are using managed services to handle the traditional challenges of skill gaps, budgets shortfalls, and head count limits, as well as new challenges like compliance, convergence, complexity, and corporate responsibility. The resources we offer you include:
If you're considering a move to a managed service model, want to know how you can optimize and extend your current services, or wish to understand how managed services could affect your resource planning, data centre, IT cycles or budget, our professional services team is waiting to hear from you. Contact us today for an overview or an audit on your environment. As always, we welcome your feedback on the tools and resources we offer you in Impact and on any other aspect of our services. Best regards, Stéphane Boisvert President, Bell Enterprise ... Discussion with an expertExpert Q&A: Gartner Inc. analyst Eric Goodness discusses the future of managed services
Impact: Hi, Eric. Thanks for joining us. Let's start with a quick look back: how have managed services changed over the last few years? Eric: Well, back in the 90s, you had small remote-monitoring companies with monthly per-node or per-server pricing. Then from 2000 to 2004, managed services became a replacement for burdensome outsourcing, and the market moved to larger companies. Providers have moved from the per-element approach to end-to-end application guarantees, or, more recently, guaranteed business outcomes. For example, a large U.S. airline's managed service provider guarantees business transactions on a ticket kiosk, and the IT across that entire transaction, rather than router or server uptime. Guaranteed business outcomes are the future of managed services. Impact: What are the key managed services trends you're seeing in the marketplace today? Eric: Up to this point, managed services have been 100 per cent focused on technology management. Solutions going forward are going to tie in business process and business value, building a bridge from technology management to financial management, so that organizations have a much better view of the uses and the benefits of their technology. An example is the emergence of telecom expense management on top of traditional technology management. End users gain access to not only their network product and service inventories, but also the associated cost of each user. Impact: Corporate social responsibilities, such as compliance requirements and green IT, are in the spotlight today. What role can managed services play in fulfilling those responsibilities? Eric: Well, considering compliance first, this will be part of that bridge to business and finance. Telecom expense management includes call accounting and chargeback info. This becomes a very important compliance tool. The same is true for storage and other datacentres – again, you get chargeback, allocation, and audit trail capabilities. Managed services also support a green IT approach. They can proactively identify potential problems before they cause outage time, which reduces field dispatches, truck rolls, and so forth. Also, you get real-time, online billing and invoicing, which saves trees. Impact: Another major issue enterprises face is the increasing complexity of IT systems. Is this affecting the way end-users view managed services? Eric: The growing complexity of how networks and enterprise applications converge is certainly driving managed services. In North America, about 50 percent of companies that deploy new IT infrastructures are buying managed services – some because they don't have the in-house skills, some because they don't want to invest more in resources. As IT telephony becomes unified communications, which in turn will become communication-enabled business processes, managed services will be integral. Not many organizations have the skill set to manage the development, integration, and maintenance of service-oriented architectures and Web services for communication. With managed services you get better access to technology and development than you ever could independently. Impact: Can you speak to the increasing momentum of software-as-a-service (SaaS) and how that will affect the managed services landscape? Eric: Every journey begins with one step, and managed services are the first step towards the journey to adoption of real-time utilities such as SaaS, utility computing, and/or cloud computing. Take IP telephony. Hosted solutions have halved in terms of end-user price points over the past 18 months. But the adoption rate is very low. Why? Because there's a natural progression of the adoption of new technologies and services. Third-party management of IT communications and enterprise applications need to be proven on customer premises before end-users are willing to leap into the cloud, where everything is a service, especially the technology. Impact: How do managed services integrate with the move towards virtualization? Eric: We're seeing the virtualization revolution occur on the premises of the organization, which is good – because if you look at management services of customer services on customer premises, right now there really aren't any. Some offshore providers are starting to implement these in data centres, but they aren't proactive, they don't offer a threshold-reactive approach for dynamic allocation of services. This is a big hole in the market, and you can expect it to be filled in the next 18 months. Impact: If you could leave our readers with one thought on the future of managed services, what would it be? Eric: This is going to be the newest gold rush. But one of the things that has really hampered the industry to date is lack of knowledge on the part of end-users of what exactly their SLAs should include. Customers really have to define their statements of work and exactly what is being purchased. Eric Goodness is a vice-president at Gartner Inc. with more than 18 years in the IT industry, including stints at Bay Networks, Cabletron and Nortel. He is currently the Agenda Manager and customer lead for Managed Services in the Communications Sector. His research and advisory services focus on customer and vendor outsourcing and IT services issues surrounding business communications. Want to learn more about how your organization could benefit from managed services? Complete our managed services needs diagnostic tools or request to have a Bell representative contact you. Have a Bell representative contact you Download managed services needs diagnostic tools ... Managed services: from cost reduction to strategic imperative
By Kim Fennell It's a common challenge: IT staff strives to focus on innovation, adding value, and achieving corporate objectives…and yet are too tied down by the press of day-to-day maintenance and support to accomplish the basics of running the business. Worse, in a weakening economy, they're asked to do more with less. More storage, more applications, new technologies, less downtime, tighter security – the expectations rise inexorably, usually faster than the budget. A frequent response to these pressures has been to procure IT and connectivity from managed service providers (MSPs). From security and Web hosting to storage and network connectivity, MSPs help enterprises supplement their IT organization's critical IT management functions, while allowing them to retain control and enable staff to focus on key projects. While cost reduction is still a compelling driver, customers are looking to managed services to play a more important role in increasing their operational efficiency. All of this adds up to improving customer service by taking advantage of the technical support that a proven MSP will provide. Accordingly, MSPs now allow customers to take advantage of improved ROI in areas such as:
The future: Smarter, more aware managed services To meet increasing demand, managed services will have to adapt. The whole infrastructure over which they run – the network, the systems, the applications – will have to be smarter, more aware of how users are consuming resources and adjust accordingly, all in a seamlessly connected and secure environment. For IT leaders, the question isn’t whether to out-task. It’s how and to what extent. Accordingly, IT leaders need to have a solid methodology in place to evaluate, configure and manage their out-tasking relationships. With clear expectations in place, solid SLAs and a commitment to good governance, managed services will continue to grow in importance as “core” elements of the enterprise IT strategy. Why Bell Bell is a proven leader in the Canadian marketplace providing LAN, WAN and security management to the Fortune 1000 in Canada while also meeting their international networking management requirements. Some areas of leadership:
To find our how managed services can help your organization, contact your Bell representative. You can also request to be contacted by a Bell representative by completing a short form. Kim Fennell, General Manager, Managed Services and Outsourcing Solutions ... Resource CentreManaged services diagnostic tools
Managed services can help you free your IT workers from mundane everyday tasks, simplifying application delivery and systems and information management to reduce costs and ensure your enterprise retains control over your IT and connectivity strategy. But how and where do you start? And where could managed services be of greatest benefit in your organization? Here we offer you five downloadable assessment tools covering: hosting, network, security, storage and wireless LANs. Answering the questions in the assessment tools will help with your managed services diagnosis, including what things you need to consider, what functions you can out-task, and how quickly can you expect to see ROI. Take me to the diagnostic tools! 10 Questions to ask your managed services provider We've put together 10 questions you can ask a potential managed service provider to make sure they've got the personnel, technical expertise, resources and experience you need. This valuable resource will help you ensure you have the managed services provider that is right for you! Quick assessment – could your organization benefit from managed services? Interested in a quick assessment of whether your organization could benefit from managed services? Complete this short questionnaire. ... Gaining a competitive edge with end-to-end solutionsEnterprises today must contend with a wide range of challenges, from an IT skills shortage to dealing with unexpected events – such as major outages – that can cost hundreds of thousands of dollars or more dollars in unbudgeted funds. Many companies are dealing with these issues by adopting a managed services approach and they are learning that the more systems they move to managed services, the more benefits they reap. Moving to managed services on a piecemeal, multiple-vendor basis can create more problems than it solves; there will be no sole focus of accountability, and different vendors' services may be incompatible. A simple solution to meet your needs A sound choice is to select a provider that can supply all the requisite services and deliver them as a comprehensive, end-to-end solution. For instance, in opening a new retail store or bank branch, the end-to-end managed solution could include: communications, point-of-sale solutions, handheld devices, cabling, wireless networks, Web presence, and technical support. Benefits of this approach include:
You are still in controlHaving a managed services provider doesn’t mean you give up control of your infrastructure. On the contrary, when Bell provides managed services, our clients are equipped with more information to make business decisions than they ever had before. How Bell has helped clients with end-to-end managed servicesBell is a leader in managing infrastructure – and not just voice and data networks. Here are a few examples of how we have helped clients:
Want to learn more? Download our managed services needs diagnostic tools or request to have a Bell representative contact you. ... Managed services definedEver wonder what ‘managed services’ really means? Here is a simple explanation. Managed Services (MS) is the practice of transferring the responsibility for day-to-day management of network-based services, applications, or equipment to an outside vendor, with the strategic intent of ensuring more effective and efficient operations. Normally, the client specifies, and retains full control of the functionality and performance of managed services, and does not delegate the overall management responsibility of its organization, infrastructure and system.
With Managed services from Bell, clients will:
Want to learn more? Download our managed services needs diagnostic tools or request to have a Bell representative contact you. ... 2008 IT budgets: Are you keeping pace with the times?CIO Magazine recently published a list of emerging IT trends to watch for in 2008. In a survey earlier this year, Bell asked business and IT managers at Canada’s largest enterprises where they are spending their IT budgets this year and how these allocations have changed compared to last year. The results, from 141 corporate and public sector respondents, tell an interesting tale of how emerging trends and changing organizational needs are dictating – or not – IT budget allocations. We also learned how large organizations are spending this year against traditional IT categories. How is your IT budget lining up against that of your peers? What clients told us about their project and budget prioritiesWe asked our customers whether the following trends were reflected in their IT budget allocations this year. IP migrationFrom VoIP to the application aware network, IP migration is one of the hottest trends in enterprise IT. How much so? Respondents identified migration to IP as one of the top areas for IT spending. More than 16 per cent of respondents listed IP migration projects as their top IT budget item for the year. This was second only to enterprise-wide software roll-outs. What are the key areas that enterprises are focusing on for IP migration in 2008?
Overall, the responses indicate that most enterprises are still in the process of migrating more straightforward applications over to IP this year. Less than 10 percent of respondents indicated that they are moving to a managed IP solution with a provider who can help deliver on the vision of the “application-aware network”. In the public sector, 33 percent of respondents included IP migration in the top three of their budgets items for the year, versus 17 percent for private sector respondents. It's hard to say from this first survey whether these numbers indicate that the public sector is leading the way or playing catch-up in the IP migration space, but it will be interesting to see how this changes next year. Unified communications The increasingly mobile workforce and the proliferation of smart communication devices both seem to be having a large impact on IT spending. More than 56 percent of respondents said they were planning a project involving unified communications this year, and a third of these respondents said they were spending more in this area than last year. How important is unified communications in the grand scheme of things? It was identified as the single most important issue to be solved by a margin of almost two to one over any other issue. This would indicate that IT decision-makers are taking seriously the challenge posed by the changing needs of information workers in large organizations. However, in terms of dollars, unified communications hasn't yet come to dominate the budget; it was only listed by 20 percent of respondents as the largest area of IT budget expenditure. Areas that were allocated more of the 2008 spend included: enterprise software roll-outs, security, and compliance management. It also seems that the unified communications challenge is universal: responses to this question were nearly identical for public and private sector respondents. Virtualization It is no secret that network resources are massively under utilized. Are IT budgets awakening to the benefits of virtualization in this regard? Almost half of respondents indicated that they were planning a project involving virtualization of system resources this year. More than a quarter of respondents included virtualization in their top three IT budget line-items for the year, and just one in 10 respondents listed this as their single largest item. In a comparison between public and private sector, 58 percent of public sector respondents are planning a virtualization project versus 42 percent for private sector organizations. Green IT Many organizations are talking about the greening of the enterprise. Are organizations putting their money where their mouths are when it comes to IT spending? Only 18 percent of respondents said they were planning a project this year involving the greening of IT. When asked the top issue that they would like their IT budgets to solve this year, only five percent of respondents chose green IT. In the public vs. private sector split, it was interesting to note that almost 25 percent of public sector respondents said that they were planning a green IT project this year, versus 13 percent for private sector organizations. While the greening of the enterprise may be emerging as a priority for top level executives, the reality seems to be that overall IT spending is not yet reflecting this imperative. It will be interesting to observe how quickly this changes in future surveys as more enterprises adopt green policies and mandate their implementation across the organization. Trends vs. tradition We have seen that some emerging trends and organizational shifts are dictating IT budgets for 2008 – and some not. What is happening with some of the more traditional IT spending categories this year? The following activities were listed by respondents as being higher priorities for 2008 over previous years:
Next year? Clearly, IT decisions makers are having to set budgets in accordance with the changing realities of the organization and to keep pace with emerging trends in IT. It is only May, but decisions about next year's IT budget allocations are not far off – where is your organization going to focus for the coming year? |
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Imagine if you could drive your IT infrastructure the same way as you drive your car, with a complete dashboard showing you speed, engine status, fuel consumption, specific warnings, maintenance reminders, and responsive controls to steer the course?
Impact spoke with Eric Goodness, a vice-president at Gartner Inc., to discuss the future of managed services: the move to guaranteed business outcomes, financial management, unified communications and cloud computing. Read on to learn how enterprises can benefit from these trends.
