MSP Market Report

A study into the
managed IT services provided
by UK IT Service Providers
January 2010
TabIe of contents
Ìntroduction .....................................................................................................3
Market overview ..............................................................................................5
Research findings ............................................................................................7
The ÌT service provider business model ......................................................7
The services provided ..............................................................................8
How services are delivered .......................................................................8
The challenges facing ÌT service providers ..................................................9
Future expectations ................................................................................ 10
Summary ....................................................................................................... 11
The case for the Outsourced ÌT ÷ or MSP - model ......................................... 12
Recommendations ......................................................................................... 13
Ó
Number of computer systems managed
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
Less than 250 251 to 1,000 1,001 to 5,000 5,001+
Diagram 1: Who participated?
1
http://stats.berr.gov.uk/ed/sme/smestats2008-ukspr.pdf
Introduction
ÌT has become a critical component of running a successful business, providing the machines, tools,
applications and services that companies need to run successfully. There are approximately 4.8 million
private sector businesses in the UK, employing around 23 million people, and delivering an estimated
combined turnover of £3,000 billion
1
. These businesses must ensure their ÌT systems are up to date,
secure and effective, but many ÷particularly smaller organisations - cannot justify the investment in
internal ÌT resource or expertise.
This suggests an ideal opportunity for UK ÌT service providers, but with reports of headcount freezes,
eroding margins and stunted profitable growth, it seems tapping into this potentially valuable market is a
challenge.
We wanted to better understand the current trends in the ÌT services sector and gain insights into the
challenges market players are facing, so we questioned ÌT service providers across the UK about their
business models, their key pain points and the steps they are taking to overcome these.
This report presents the findings of the research, within the context of the wider market trends impacting
the ÌT services sector. Ìt also provides analysis into the research results and offers good practice advice
and recommendations to help ÌT service providers adopt a business model and technology platform that
will deliver profitability and growth.
Research methodoIogy
This study surveyed approximately 450 ÌT service providers in the UK.
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Around 40% of the respondents were small ÌT service providers managing less than 250 computer
systems (desktops, notebooks and servers). Almost 50% of the companies manage between 251 and
5,000 systems, with the remaining 10% providing ÌT services to over 5,000 endpoints.
Who is this report for?
This report is primarily aimed at those people who own, run or work within the ÌT service provider sector,
serving a small to medium-sized enterprise (SME) customer base. Channel players such as distributors
and resellers may also find this guide beneficial in enabling their companies to introduce value-added
services and increase profitability, at a time when resale margins are being tightly squeezed.
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2
http://stats.berr.gov.uk/ed/sme/smestats2008-ukspr.pdf
Market overview
Never before has technology been so integral to the way we do business.
The internet is breaking down global barriers, enabling companies to work and collaborate with anyone,
at any time, from any location. The age old desktop PC has been replaced by a plethora of devices such
as laptops, netbooks and smart phones, which are driving the increase in mobile and remote, working.
Windows is no longer the dominant software it once was with Macintosh and Google gaining market
share and available on more devices than ever. Add to this the way we access and use a growing
number of applications and services is being strongly influenced by developments such as cloud
computing and virtualisation and it is not hard to see how reliant we have become on technology.
Analyst predictions that ÌT spend is on the rise, despite the challenging economic conditions experienced
in 2009, only serve to emphasise the growing reliance on technology in the workplace. Forrester
Research expects European spending on ÌT goods and services to start growing from Q1 2010, while
Gartner estimates global spending on ÌT will grow 3.3% to $3.3 trillion in 2010, reversing the worst slump
the industry has ever seen.
The market opportunity
But what does this mean for ÌT service providers?
Worldwide, the overwhelming majority of companies fall into the small to medium-sized enterprise (SME)
category and this is no different in the UK, where SMEs account for 99.9% of all businesses
2
. This
market is growing too, with these companies employing an estimated 13.7 million people in 2008 (2.1%
more than in 2007) and turnover estimated at £1,500 billion per year ÷ over £60 billion higher in 2008 than
in 2007.
SMEs are keen to take advantage of the latest technology tends, new internet applications and delivery
models such as software-as-a-service ÷ after all, these promise the ability to compete on a global scale
and drive efficiencies and profitability into their businesses. But while SMEs understand the now critical
role that ÌT is playing in their business, the majority simply don't have the internal ÌT department or
dedicated resource to support, maintain and manage increasingly complex networks, devices and
infrastructure.
SMEs just want their ÌT to work ÷ all the time ÷ and therein lies the opportunity for ÌT service providers.
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Market chaIIenges
So on the face of it the SME market seems to offer rich pickings for ÌT service providers, with a potentially
huge customer base that needs the help of experts to keep the cogs turning and make sure they keep up
with ÌT developments. With margins on hardware and software sales declining, an increased emphasis
on delivering high value services could also be just the ticket for channel players to increase profitability.
But if that's the case then why are ÌT service providers still struggling with limited resource, eroding
margins and a ratio between turnover and profitability that just doesn't add up?
Quite simply, the traditional break/fix model for ÌT service delivery that is adopted by so many service
providers just doesn't stack up. When something goes wrong, the customer calls in the ÌT service
provider to fix it, and then pays by the hour for a technician to visit their site and resolve the problem or
uses pre-purchased hours on a maintenance contract. Ìn practice, this reliance on 'problems' occurring
on customer sites can lead to strongly fluctuating turnover and problems with resource planning.
But perhaps the biggest limitation to this 'break/fix' methodology is the inability to grow profit margins. A
technician can only do a certain number of hours in a day, and that means the ÌT service provider can
only charge for that many hours. As a result, however much the customer base increases, more resource
is always needed to meet that demand, and profit margins will never grow.
So the challenge faced by ÌT service providers is twofold. Firstly, the present services they deliver must
be set up as efficiently as possible in order to reduce the 'cost' of the service and thus recover some of its
profit margin. And secondly, they must look to new models that avoid a reactive approach to solving
problems and instead focus on proactive management and support of customer ÌT systems.
È
The IT service provider business modeI
Break/fix incident response
Block hour-based & project
billing
Fully outsourced ÌT
How services are biIIed
37%
38%
39%
40%
41%
42%
43%
44%
45%
46%
47%
By the hour Blocks of time Flat monthly fee
Research findings
The IT service provider business modeI
Traditionally, ÌT service providers apply the 'break/fix' business model. Customers identified a problem,
then paid the service provider to fix it for them. This model is still popular in the UK services sector, used
by 30% of the UK companies examined, but the majority are currently billing based on projects and block-
hours paid for.
When we look at how services are billed to clients, just under half (46%) of ÌT service providers rely on
billing for the number of hours worked. This is no surprise when we know the majority also adopt the
'break/fix' model or charge for block hours, which means the majority of ÌT service providers generally still
earn the greatest part of their turnover reactively.
Diagram 2:
Diagram 3:
Ç
IT services provided

Systems used to deIiver managed IT services
0%
10%
20%
30%
40%
50%
60%
70%
The services provided
Ìn general, ÌT service providers have the same offerings, although spam and anti-virus support are among
the most popular types of services. The reasonably balanced numbers of services also points to a
broader holistic approach where service providers are offering everything as a service for their customers.
Diagram 4:
Diagram 5:
How services are deIivered
The research shows the majority of ÌT service providers use partial tools to simplify a specific
management activity, for example patching or anti-virus. Ìn contrast, less than a quarter use a centralised
ÌT automation platform to manage all aspects of a client's network, although the number that still depend
entirely on 'manual interventions' - and therefore use no tools - is also low.
n
The biggest chaIIenge facing IT service providers
Staying profitable;
becoming more profitable
Completing the volume of
work with limited staff
Providing a higher level of
service to clients
Differentiating our services
from the competition
Other (please specify)
3%
20%
48%
13%
16%
Steps taken to maintain profitabiIity
0%
10%
20%
30%
40%
50%
60%
70%
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The chaIIenges facing IT service providers
The vast majority of UK ÌT service providers stated profitability as their key challenge. One in five (20%)
also stated differentiation from the competition as a challenge, which comes as no surprise considering
the services offered are very similar across all the companies we questioned.
Diagram 6:
Diagram 7:
When we look at the steps that ÌT service providers are currently taking to maintain their profitability,
overwhelmingly, they are increasing their emphasis on generating sales and acquiring new customers. Ìt
is however interesting to note that 37% of respondents have adopted some form of Automation of ÌT
tasks in their quest to maintain profitability.
™
Expectations of biIIing projections in next 12 months
Remain the same
Decrease moderately
Decrease substantially
Ìncrease moderately
Ìncrease substantially
13%
25%
25%
32%
5%
Business modeI v. future biIIings
0%
20%
40%
60%
80%
100%
Break/Fix Block-hours and
projects
Fully
Outsourced ÌT
Ìncrease substantially
Ìncrease moderately
Stay the same
Decrease moderately
Decrease substantially
Future expectations
Perhaps surprisingly, despite a challenging economic situation, the majority of ÌT service providers have
positive expectations for the future with respect to turnover. Only around a third (30%) expected billing
levels to decrease in the next 12 months, compared to 45% that expected moderate or significant
increases. A quarter of ÌT service providers said turnover would remain the same.
Diagram 8:
Diagram 9:
Here, it is interesting to note a link between the business model used by the ÌT service providers and their
expectations for 2009. Those that still depend largely on reactive (break/fix) business models are much
less positive about their turnover, whereas 60% of those who offer a fully outsourced ÌT function expect
an increase.
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Summary
Ineffective business modeIs - the "break/fix¨ model is used by around a third of UK ÌT service
providers, but this means the majority are paid for the hours they spend solving a problem. This reactive
approach means revenues are inextricably linked to the amount of technicians that are available to
handle customer problems, which in practice can result in problems with personnel planning, strongly
fluctuating turnover and is guaranteed to cap the ability to grow profit margins.
Lack of market differentiation - ÌT service providers across the UK largely offer the same services,
making it extremely difficult to differentiate their company from the competition. As a result, the focus
needs to be on the quality of those services offered to SME customers. A positive, ongoing relationship
with customers will be achieved if ÌT service providers can, for example, actively demonstrate the value
they are delivering to their clients, such as meeting service level agreements (SLAs), reducing the
number of attacks on the network or increasing network uptime.
PartiaI tooIs rather than a centraI framework - ÌT service providers typically use tools to make work
scalable, reproducible and verifiable, and the research shows the majority use partial solutions that
simplify a specific management activity, for example patch management. Few have embraced the use of
an ÌT automation platform, so it comes as no surprise one of their key challenges remains profitability.
Using an overarching framework to automate tasks and control and manage every client network from a
central integrated system, can pay dividends in freeing up technicians and increasing that all important
profit margin.
Key chaIIenges - Profitability is the over-riding challenge facing most UK ÌT service providers, followed
by market differentiation and then completing the volume of work with a limited number of staff. However,
the key steps that ÌT service providers are taking to address the profitability challenge is to increase their
sales efforts.
Future expectations - Despite a challenging economic situation, the majority of ÌT service providers
have positive expectations for the future with respect to turnover. Only around a third expect billing levels
to decrease in 2010 and it is interesting to note that it is the ÌT service providers that largely depend on a
reactive, 'break/fix' business model who are much less positive about future growth.
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The case for the Outsourced IT - or MSP - modeI
A number of UK companies are leading the drive moving away from a break/fix approach to adopting an
outsourced ÌT ÷ or managed service provider (MSP) - business model. Many of these companies are
using the Kaseya ÌT Automation Framework to manage every client's ÌT infrastructure, network
components, servers and desktop PCs - remotely, comprehensively, and transparently.
These market leaders are realising very real benefits, including increased turnover ÷ and profits ÷ market
differentiation and the ability to grow their business to meet SME demand, without adding headcount.
Panacea
"We soon realised managed services could develop into a significant revenue stream for us and we are
now making it a definable part of our organisation rather than it just overlaying on top of the existing
organisation. The economic, environmental and time-saving advantages of managed services are clear.¨
Mike Olpin, Commercial Director
Ziptech
"Customers don't need to see engineers ÷ they just want their ÌT systems to be up and running and
supporting the business, preferably with a fixed monthly cost. The only way that can be achieved is by
shifting away from the traditional ÌT support break/fix model to one based on real time monitoring and
automation.¨
"There is a huge opportunity to deliver ÌT services to the SME market, but it's changing fast and the fact
that Kaseya enables Ziptech to remotely monitor and automatically fix problems to drive up availability at
a fixed monthly price is a very strong competitive differentiator.¨
Jim Simpson, Managing Director
IT Lab
"We relied on a traditional break/fix model, whereby we reacted to individual client problems as they
happened. However, this was proving to be increasingly inefficient as the number of businesses looking
to outsource ÌT support grew and demand for our services increased. Engineers were dealing with every
problem on a machine-by-machine-basis, which often involved travel to customer premises. Ìnevitably,
this was affecting engineer productivity and our ability to provide a fast response to clients.¨
"Now our team can securely manage the ÌT systems of every one of our clients from anywhere in the
world. Our reactive support workload which originally required four engineers for onsite work now only
requires two and the majority of their time is now dedicated to new implementation work rather than
break-fix support.¨
Matthew O'Neill, Strategy Director
£Ó
Recommendations
Moving from a break/fix model to a Managed Service Provider (MSP) approach will enable your business
to enjoy recurring monthly revenues, with higher profit margins, lower overheads and an unlimited
freedom to grow.
Here are some key elements to success:
· CentraIise controI - use a single, integrated web-based system to manage all your clients'
systems centrally, so standard roll-outs, upgrades and updates can be rolled out simultaneously
to save valuable time, and to ensure you have a complete overview of all your clients' systems at
your finger tips
· Adopt an automated approach - set up automated tasks and processes to run across your
clients' networks, such as patch management, end point security and auditing. Their exposure to
security threats will be minimised, systems continuously updated, and will reduce your man hours
significantly by managing by exception
· Define and impIement best practices - create and implement best practices based upon your
knowledge and experience, as it is your technical abilities and knowledge that set you apart from
your competitors
· Integrated heIpdesk - Track and respond to your customer issues and requests automatically
and provide an end-user portal for easy access for your customers to create and view their own
tickets.
· Define your SLAs - Define account templates for various Service Level Agreements (SLA) so
clients know exactly what to expect for the package they opt for.
· Comprehensive reporting - One of the most important aspects of managed services is
communication to the client, so make sure you have reporting in place that will inform your clients
on what you have been doing and why their systems are highly available
The Kaseya IT Automation PIatform for MSPs
Kaseya's platform provides a unified set of tools that proactively monitor, manage and control ÌT assets
remotely, easily and efficiently from one integrated Web-based platform. The Kaseya Managed Services
Edition software is an integrated ÌT Automation framework specifically designed to enable MSPs to
manage multiple customers, install and configure systems, collect system status data, protect critical data
and system resources, and provide a robust set of managed services for their customers - without the
need for additional staffing resources.
For a free, 30 day trial visit http://www.kaseya.co.uk/forms/free-trial.aspx
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About Kaseya
Kaseya is the leading global provider of ÌT automation software for ÌT Service Providers and Public and
Private Sector ÌT organisations. Kaseya's ÌT Automation Framework allows ÌT Professionals to proactively
monitor, manage and maintain distributed ÌT infrastructure remotely, easily and efficiently with one
integrated Web-based platform. Kaseya's technology is licensed on over three million machines
worldwide.
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or MSP .model 12 13 2 . The services provided How services are delivered The challenges facing IT service providers Future expectations ~~ 3 5 7 7 8 8 9 10 11 Summary The case for the Outsourced Recommendations IT .Kaseya Table of contents Introduction Market overview Research findings The IT service provider business model.

000 billion". eroding margins and stunted profitable growth. It also provides analysis into the research results and offers good practice advice and recommendations to help IT service providers adopt a business model and technology platform that will deliver profitability and growth.Kaseya Introduction IT has become a critical component of running a successful business. We wanted to better understand the current trends in the IT services sector and gain insights into the challenges market players are facing. applications and services that companies need to run successfully. so we questioned IT service providers across the UK about their business models. their key pain points and the steps they are taking to overcome these. There are approximately 4.berr.uk/ed/sme/smestats2008-ukspr.000 1. it seems tapping into this potentially valuable market is a challenge.001 to 5.000 5.pdf 3 . tools.gov. Research methodology This study surveyed approximately 450 IT service providers in the UK. Number of computer systems managed Less than 250 251 to 1. and delivering an estimated combined turnover of £3. but many -particularly internal IT resource or expertise.cannot justify the investment in ~~ This suggests an ideal opportunity for UK IT service providers. These businesses must ensure their IT systems are up to date. employing around 23 million people.001+ Diagram 1: Who participated? 1 http://stats. but with reports of headcount freezes.8 million private sector businesses in the UK. secure and effective. smaller organisations . within the context of the wider market trends impacting the IT services sector. This report presents the findings of the research. providing the machines.

000 systems. at a time when resale margins are being tightly squeezed. serving a small to medium-sized enterprise (SME) customer base. ~~ Who is this report for? This report is primarily aimed at those people who own. with the remaining 10% providing IT services to over 5. 4 .000 endpoints. Almost 50% of the companies manage between 251 and 5. Channel players such as distributors and resellers may also find this guide beneficial in enabling their companies to introduce value-added services and increase profitability. run or work within the IT service provider sector. notebooks and servers).Kaseya Around 40% of the respondents were small IT service providers managing less than 250 computer systems (desktops.

maintain and manage increasingly complex networks. these promise the ability to compete on a global scale and drive efficiencies and profitability into their businesses.berr. SMEs are keen to take advantage of the latest technology tends. despite the challenging economic conditions experienced in 2009. working. netbooks and smart phones.500 billion per year . the majority simply don't have the internal IT department or dedicated resource to support. Analyst predictions that IT spend is on the rise.9% of all businesses/. the overwhelming majority of companies fall into the small to medium-sized enterprise (SME) category and this is no different in the UK. new internet applications and delivery models such as software-as-a-service .7 million people in 2008 (2.3% to $3. But while SMEs understand the now critical role that IT is playing in their business.gov.and therein lies the opportunity for IT service providers.uk/ed/sme/smestats2008-ukspr. Add to this the way we access and use a growing number of applications and services is being strongly influenced by developments such as cloud computing and virtualisation and it is not hard to see how reliant we have become on technology.after all. while Gartner estimates global spending on IT will grow 3. Windows is no longer the dominant software it once was with Macintosh and Google gaining market share and available on more devices than ever. Forrester Research expects European spending on IT goods and services to start growing from 01 2010. with these companies employing an estimated 13. ~~ The internet is breaking down global barriers. reversing the worst slump the industry has ever seen.over £60 billion higher in 2008 than in 2007. enabling companies to work and collaborate with anyone. 2 http://stats.1% more than in 2007) and turnover estimated at £1. at any time. SMEs just want their IT to work . The market opportunity But what does this mean for IT service providers? Worldwide.Kaseya Market overview Never before has technology been so integral to the way we do business. devices and infrastructure. This market is growing too. from any location. where SMEs account for 99. which are driving the increase in mobile and remote.pdf 5 . The age old desktop PC has been replaced by a plethora of devices such as laptops. only serve to emphasise the growing reliance on technology in the workplace.3 trillion in 2010.all the time .

this reliance on 'problems' occurring on customer sites can lead to strongly fluctuating turnover and problems with resource planning.Kaseya Market challenges So on the face of it the SME market seems to offer rich pickings for IT service providers. with a potentially huge customer base that needs the help of experts to keep the cogs turning and make sure they keep up with IT developments. With margins on hardware and software sales declining. and then pays by the hour for a technician to visit their site and resolve the problem or uses pre-purchased hours on a maintenance contract. Firstly. the customer calls in the IT service provider to fix it. the traditional break/fix model for IT service delivery that is adopted by so many service providers just doesn't stack up. the present services they deliver must be set up as efficiently as possible in order to reduce the 'cost' of the service and thus recover some of its profit margin. And secondly. But perhaps the biggest limitation to this 'break/fix' methodology is the inability to grow profit margins. So the challenge faced by IT service providers is twofold. ~~ But if that's the case then why are IT service providers still struggling with limited resource. more resource is always needed to meet that demand. they must look to new models that avoid a reactive approach to solving problems and instead focus on proactive management and support of customer IT systems. 6 . an increased emphasis on delivering high value services could also be just the ticket for channel players to increase profitability. When something goes wrong. A technician can only do a certain number of hours in a day. In practice. As a result. and profit margins will never grow. however much the customer base increases. and that means the IT service provider can only charge for that many hours. eroding margins and a ratio between turnover and profitability that just doesn't add up? Quite simply.

Customers identified a problem. This model is still popular in the UK services sector. but the majority are currently billing based on projects and blockhours paid for. This is no surprise when we know the majority also adopt the 'break/fix' model or charge for block hours.Kaseya Research findings The IT service provider business model Traditionally. just under half (46%) of IT service providers rely on billing for the number of hours worked. IT service providers apply the 'break/fix' business model. ~~ The IT service provider business model • • • Break/fix incident response Block hour-based & project billing Fully outsourced IT Diagram 2: When we look at how services are billed to clients. used by 30% of the UK companies examined. which means the majority of IT service providers generally still earn the greatest part of their turnover reactively. then paid the service provider to fix it for them. How services are billed 47% 46% 45% 44% 43% 42% 41% 40% 39% 38% 37% By the hour Blocks of time Flat monthly fee Diagram 3: 7 .

~~ IT services 35% 30% 25% 20% 15% 10% 5% 0% provided ~ ~ "t: r .~ ~ JlI .. although the number that still depend entirely on 'manual interventions' .iii ill 'i! .is also low. rll !II. although spam and anti-virus support are among the most popular types of services. In contrast.and therefore use no tools .~ ~ Diagram 4: How services are delivered The research shows the majority of IT service providers use partial tools to simplify a specific management activity.E !IJJ ·[E ·il e III ~ i. IT service providers have the same offerings.:§ ·il ::. Systems used to deliver managed IT services Diagram 5: 8 .>: =I 0.a- !IJJ a !. j)!j -c i ·e E .. The reasonably balanced numbers of services also points to a broader holistic approach where service providers are offering everything as a service for their customers. less than a quarter use a centralised IT automation platform to manage all aspects of a client's network... "I! !IJJ iii . for example patching or anti-virus.I ~ !IJJ i~ ! E 'a !!I iii) E· ill d c III "1::! 1i .Kaseya The services provided In general.

Kaseya The challenges facing IT service providers The vast majority of UK IT service providers stated profitability as their key challenge. ~~ The biggest challenge facing IT service providers • Staying profitable.8 <{ 2 co E 0:: " Diagram 7: 9 . It is however interesting to note that 37% of respondents have adopted some form of Automation of IT tasks in their quest to maintain profitability. becoming more profitable • Completing the volume of work with limited staff • Providing a higher level of service to clients • Differentiating our services from the competition • Other (please specify) Diagram 6: When we look at the steps that IT service providers are currently taking to maintain their profitability. overwhelmingly. which comes as no surprise considering the services offered are very similar across all the companies we questioned. they are increasing their emphasis on generating sales and acquiring new customers.~ ""iii "0 Q) '" ~ ~ Q) 0:: "0 Q) '" " o Q) ""iii Q) "0 0:: o 1: '" '" co '" e Q) :. One in five (20%) also stated differentiation from the competition as a challenge.0 Q) ~ ~ OJ '" 2 :.0 Q) ~ ~ OJ '" 2 '" "'" '" 1!l t:: "0 Q) Z " a "0 "0 o 1: '" ~ co "0 Q) " o . Steps taken to maintain profitability 70% 60% 50% 40% 30% 20% 10% 0% tI:: 1!l Q) "0 "0 Q) '" " o .

Those that still depend largely on reactive (break/fix) business models are much less positive about their turnover.Kaseya Future expectations Perhaps surprisingly. the majority of IT service providers have positive expectations for the future with respect to turnover. despite a challenging economic situation. Business model v. whereas 60% of those who offer a fully outsourced IT function expect an increase. future billings • Increase substantially • Increase moderately Stay the same Decrease moderately Decrease substantially Break/Fix Block-hours and projects Fully Outsourced IT Diagram 9: 10 . A quarter of IT service providers said turnover would remain the same. it is interesting to note a link between the business model used by the IT service providers and their expectations for 2009. compared to 45% that expected moderate or significant increases. ~~ Expectations of billing projections in next 12 months • • • • • Diagram 8: Remain the same Decrease moderately Decrease substantially Increase moderately Increase substantially Here. Only around a third (30%) expected billing levels to decrease in the next 12 months.

followed by market differentiation and then completing the volume of work with a limited number of staff. Only around a third expect billing levels to decrease in 2010 and it is interesting to note that it is the IT service providers that largely depend on a reactive. the majority of IT service providers have positive expectations for the future with respect to turnover.Profitability is the over-riding challenge facing most UK IT service providers. actively demonstrate the value they are delivering to their clients. strongly fluctuating turnover and is guaranteed to cap the ability to grow profit margins.Kaseya Summary Ineffective business models .IT service providers typically use tools to make work scalable. 11 . However. the focus needs to be on the quality of those services offered to SME customers.the "break/fix" model is used by around a third of UK IT service providers. for example patch management. Few have embraced the use of an IT automation platform. A positive. for example. Key challenges . Using an overarching framework to automate tasks and control and manage every client network from a central integrated system. but this means the majority are paid for the hours they spend solving a problem. so it comes as no surprise one of their key challenges remains profitability. which in practice can result in problems with personnel planning. such as meeting service level agreements (SLAs). can pay dividends in freeing up technicians and increasing that all important profit margin. ongoing relationship with customers will be achieved if IT service providers can. This reactive approach means revenues are inextricably linked to the amount of technicians that are available to handle customer problems. and the research shows the majority use partial solutions that simplify a specific management activity. Partial tools rather than a central framework . the key steps that IT service providers are taking to address the profitability challenge is to increase their sales efforts. making it extremely difficult to differentiate their company from the competition. reducing the number of attacks on the network or increasing network uptime. Future expectations . reproducible and verifiable. As a result.Despite a challenging economic situation. 'break/fix' business model who are much less positive about future growth.IT service providers across the UK largely offer the same services. ~~ Lack of market differentiation .

Managing Director IT Lab "We relied on a traditional break/fix model.business model.or managed service provider (MSP) ." Matthew O'Neill.market differentiation and the ability to grow their business to meet SME demand. Our reactive support workload which originally required four engineers for onsite work now only requires two and the majority of their time is now dedicated to new implementation work rather than break-fix support. and transparently." "Now our team can securely manage the IT systems of everyone of our clients from anywhere in the world.and profits .remotely.or MSP . Strategy Director 12 ." "There is a huge opportunity to deliver IT services to the SME market. which often involved travel to customer premises. Inevitably. servers and desktop PCs .Kaseya The case for the Outsourced IT . this was proving to be increasingly inefficient as the number of businesses looking to outsource IT support grew and demand for our services increased.model A number of UK companies are leading the drive moving away from a break/fix approach to adopting an outsourced IT . Panacea "We soon realised managed services could develop into a significant revenue stream for us and we are now making it a definable part of our organisation rather than it just overlaying on top of the existing organisation." Jim Simpson. The economic. comprehensively. including increased turnover . but it's changing fast and the fact that Kaseya enables Ziptech to remotely monitor and automatically fix problems to drive up availability at a fixed monthly price is a very strong competitive differentiator." Mike Olpin. ~~ These market leaders are realising very real benefits. Many of these companies are using the Kaseya IT Automation Framework to manage every client's IT infrastructure. environmental and time-saving advantages of managed services are clear. preferably with a fixed monthly cost. The only way that can be achieved is by shifting away from the traditional IT support break/fix model to one based on real time monitoring and automation. network components.they just want their IT systems to be up and running and supporting the business. However. this was affecting engineer productivity and our ability to provide a fast response to clients. Commercial Director Ziptech "Customers don't need to see engineers . whereby we reacted to individual client problems as they happened. without adding headcount. Engineers were dealing with every problem on a machine-by-machine-basis.

uklforms/free-trial.Define account templates for various Service Level Agreements (SLA) so clients know exactly what to expect for the package they opt for. with higher profit margins.Kaseya Recommendations Moving from a break/fix model to a Managed Service Provider (MSP) approach will enable your business to enjoy recurring monthly revenues. end point security and auditing. and to ensure you have a complete overview of all your clients' systems at your finger tips • Adopt an automated approach . systems continuously updated.One of the most important aspects of managed services is communication to the client. The Kaseya Managed Services Edition software is an integrated IT Automation framework specifically designed to enable MSPs to manage multiple customers. so make sure you have reporting in place that will inform your clients on what you have been doing and why their systems are highly available The Kaseya IT Automation Platform for MSPs Kaseya's platform provides a unified set of tools that proactively monitor.aspx 13 . upgrades and updates can be rolled out simultaneously to save valuable time.kaseya. so standard roll-outs. integrated web-based system to manage all your clients' ~~ systems centrally.set up automated tasks and processes to run across your clients' networks.co. collect system status data.Track and respond to your customer issues and requests automatically and provide an end-user portal for easy access for your customers to create and view their own tickets. Their exposure to security threats will be minimised. manage and control IT assets remotely. install and configure systems.use a single. such as patch management. • Define your SLAs .without the need for additional staffing resources. and will reduce your man hours significantly by managing by exception • Define and implement best practices . Here are some key elements to success: • Centralise control . protect critical data and system resources.create and implement best practices based upon your knowledge and experience. • Comprehensive reporting . as it is your technical abilities and knowledge that set you apart from your competitors • Integrated helpdesk . lower overheads and an unlimited freedom to grow. For a free. easily and efficiently from one integrated Web-based platform. 30 day trial visit http://www. and provide a robust set of managed services for their customers .

Kaseya's technology is licensed on over three million machines worldwide.Kaseya About Kaseya Kaseya is the leading global provider of IT automation software for IT Service Providers and Public and Private Sector IT organisations. easily and efficiently with one integrated Web-based platform. ~~ 14 . manage and maintain distributed IT infrastructure remotely. Kaseya's IT Automation Framework allows IT Professionals to proactively monitor.

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