In the late 19th century, electricity was produced next to the buildings and facilities that needed it. We didn’t have the technology and the know-how to carry power across vast distances until many decades later.
It even took industrialized countries like Russia and France would take nearly 50 years to reach nationwide electrification. Centralized power wouldn’t become widespread until the early 1900s – and until that happened, private-owned generators were the norm.
Eventually, of course, it became cheaper and easier to use centralized power stations.
Today, the idea of a modern business making its own electricity is absurd. Buying your own fuel, maintaining a generator, and having electrical engineers to operate the whole thing would be too expensive and inefficient.
Now here comes the twist.
A few decades from now, in-house IT may seem as inefficient and alien as in-house power generation.
That might sound weird right now – but read on and see if you don’t agree with us by the end of the article.
Comparing Managed IT Services & Centralized Electricity
100 years ago, over half of the U.S.A’s electricity was made and delivered by local stations. Fast forward to last year, and 2/3 of all companies are using I.T. services delivered remotely via the cloud.
This means that managed IT services already have a higher market penetration rate than electricity did in 1917.
It’s true only 3 in 10 companies are outsourcing their entire IT department to managed service providers – but that’s not the point here.
The point is that there’s a revolution happening in IT right now. Managed service providers are centralizing and optimizing IT operations in a way that standalone businesses can’t.
This is resulting in improved performance, lower costs, and simplified operations: the same benefits that allowed centralized electricity to become standard 100 years ago.
There’s just one small but important caveat to all of this.
Managed IT is a fledgling industry that’s full of unqualified clients and inexperienced providers. As a result, organizations – especially small and mid-sized ones – sometimes hand over their IT operations to people who aren’t remotely qualified to manage them.
This happens for 2 key reasons:
- Organizations don’t fully understand managed services and pick the wrong provider.
- Providers don’t fully understand managed services, leading them to take on more responsibilities than they can realistically handle.
The question is, how can you avoid outsourcing your IT to the wrong provider? And if you suspect your managed service provider isn’t the right choice for you, how can you tell?
We’ll answer both questions in the article below by giving you 4 tell-tale signs your managed service provider is a huge waste of money.
Number one is…
#1: Your IT Department is Still Overwhelmed
One of the main reasons to get managed services is so your internal staff can focus their bandwidth – i.e. their time and energy – on other projects.
This is particularly important if you have valuable personnel spending too much time on basic everyday tasks like server maintenance. You want to get the most out of the money you spend on key staff – and that’s just not possible if they’re overwhelmed with minor matters.
This is where managed services shine. You can trust your MSP to handle basic things like migrating to Gmail Business or automating basic tasks. You can (and should) also look for them to fill in knowledge gaps outside your IT department’s field of competence.
But what if this isn’t what’s happening for you? What if your MSP isn’t helping reduce their workload?
Then they’re a waste of time and money. Managed services that don’t improve your IT personnel’s performance inherently add nothing to your business.
The same goes for MSPs who…
#2: Don’t Make Your IT More Reliable & Resilient
44% of all businesses estimate losing over $10,000 in a single hour of downtime. Security breaches can be even more expensive. In a perfect world, your MSP will have the know-how and equipment to prevent both.
This is one of the primary reasons companies opt for managed services. There’s only so much your own equipment can staff can do. But when you augment your IT capabilities with a reliable MSP, you get access to their assets, too. This is the key to seamless uptime, data security, and cyber resilience.
Obviously, an MSP that doesn’t succeed in this area isn’t adding value to your business. Even worse, they’re leaving you vulnerable to 5, 6, and even 7-figure losses: numbers that seem far-fetched until you consider that…
- The average security attack takes 200 days to detect.
- The average cost of a data breach is $3.8 million for large companies and $690,000 for small ones.
- 60% of small and mid-sized businesses go under within 6 months of getting hacked.
Remember: we’re not just talking about your website getting hacked. We’re talking about losing mobile device data; the entirety of your e-mails; even access to your business bank accounts.
This is stuff your MSP should prevent at any cost – and if you’re not confident in their ability to do so, you’re wasting money and potentially setting yourself up to lose even more of it.
Another common problem is MSPs who…
#3: Aren’t 100% Qualified and Committed to Making You Standard-Compliant
IT services have been around long enough that they’re governed by federal and state regulations. This is an especially big deal in niches like academia, law, consumable products, and medicine. For example – healthcare providers have to comply with:
- The Health Information Technology for Economic and Clinical Health (HITECH) Act (2009).
- The Health Insurance Portability and Accountability (HIPAA) Act (1996)
The problem is, most small and mid-sized healthcare providers don’t know much about these acts. For example – 80% of small medical practices aren’t sure whether their mobile devices are HIPAA compliant.
This issue isn’t exclusive to the medical industry. Small and mid-sized businesses rarely have the competency to ensure regulation compliance. This is another area in which MSPs can help by providing you with specialized help…
IF they know what they’re doing.
Trouble is, many MSPs are small businesses themselves. They don’t know much about acts and regulations. Their lack of expertise can land you in trouble with your state, the federal government, and (if applicable) private certification organizations.
That’s why an evident lack of ability (or desire) to achieve standard-compliance is warning sign #3!
Number four on our list is…
#4: Inability to Scale Seamlessly
IT Scalability is the ability to remain online, secure, and fully operational no matter what happens. In the past, being scalable meant having excess processing power, bandwidth, etc.
This is no longer the case today, when you can rely on the cloud to give you all the juice you need on-demand. For example, Amazon’s web services can multiply your online storage and computing power by 10x or 100x with a few clicks of your button.
The caveat is that making use of such services is too complex for a small or midsized business. This is where MSPs come in, giving you the man-hours and expertise you need to scale when you need and how you need.
This is important, because it means that you won’t go offline or become vulnerable if your website content goes viral, or you get an influx of page visitors, or some of your hardware becomes damaged or incapacitated by hackers.
Unfortunately, not every MSP has the extra processing power and storage to accommodate instant scaling.
Instead, some MSPs are small organizations that consist of a small team, a few servers, and a couple of laptops. They do a great job of serving you on an everyday basis – but when push comes to shove, they simply can’t protect you from data breaches and downtime.
And while we certainly don’t mean to denigrate start-ups in the managed service niche, do you really want to entrust your IT to teams like this one?
Even if they’re really nice people working their hardest to serve you?
An MSP that becomes a liability when you need to step your game up is a waste of money. There’s many nicer ways to put it – but that’s essentially how it is.
The big question is, what can you do about it?
How can you avoid wasting money and putting your organization’s future at risk without saying no to MSPs entirely?
By making educated choices, of course!
It’s true that there’s not much information on managed services out there. It’s even truer that most of that information is incomprehensible to laypeople.
But here’s what we’ll do.
We’ll give you our free Ultimate Guide to Managed I.T. Services.
There are no strings attached; we just want businesses like yours to be safe and efficient.
After all, we ARE a Managed Service Provider – so it’s important to us the industry as a whole to have a reputation we can be proud of!
Melissa is the new kid on the block at Greenbrier Technologies & Electric. When she’s not tag teaming with her husband trying to wrangle and engage their two young daughters, you’ll find Melissa finding new and exciting ways to share GTE’s story and build relationships with folks in the “other” valley. The Greenbrier Valley may be the original home of GTE, but Melissa is quickly showing the team why the Shenandoah Valley is the place to be!
Who we areWhen Greenbrier Communications was first established in the late 1990s by founder and current president Bill Lenherr, it was his goal to provide the Greenbrier Valley and surrounding region with a much needed local option for Internet service. By 2001, when Lenherr joined…
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