Top ten tips on managed services for enterprises

Vikram Sharma lists the things to look out for while shortlisting a managed services provider

Vikram Sharma

The emergence of new data technologies, the convergence of voice, video, and data, and the explosion of e-business across industries, have resulted in corporate networks dramatically changing and becoming increasingly complex. Enterprises are now realizing the importance of outsourcing network management to managed service providers.

The Indian market presents a huge opportunity for managed services. According to recent research by Forrester, the Managed Services opportunity in India will be worth $8.7 billion by 2013 growing at a CAGR of 19%.

However, before engaging with a managed services provider and to drive maximum benefit from outsourcing services, enterprises need to keep the following considerations in mind:

• Analyze your needs: It is extremely important for enterprises to analyze their business environment, identify their needs (For e.g. in the area of security, remote office connectivity, collaboration with global customers etc.) and look at service providers who can provide solutions specific to their needs. Some providers offer many services in one region, others offer a limited number of services around the world, and others fall somewhere in between. To pick the best provider, it's important to understand what managed services the company needs and in what locations it needs them.
• Customization of services: Customized service is one of the primary requirements driving enterprises to outsource more of their network services. This makes sense given that higher-value managed services are, by definition, more integrated into the enterprise customer's online business processes than basic transport services. This also means that the mass-production mentality of ‘one-size-fits-all’ no longer applies as service providers move up the IT value chain.
• Evaluate Service Level Agreements: With the security and efficiency of operations of an enterprise's network at stake, and with typical service-level agreements (SLAs) lasting for two to five years, it is extremely important for enterprises to evaluate service level agreements properly with the vendor. Enterprises should look for vendors that understand their business and provide clear and competitive pricing, easy-to-understand contracts, and guarantees mapped to realistic performance expectations.
• Flexibility: Contracts should be flexible enough to upgrade to different classes of service or service-level agreements (SLAs) as needed. Also, services that span a range of national or international connectivity options and are scalable for the long term, allowing easy, low-cost upgrades to support evolving application needs should be considered.
• Total cost of service: It is imperative for enterprises to analyze the total cost of the service over the course of the SLA. Charges for service changes or work done outside normal business hours, in addition to initial up-front expenses, can add up to the overall cost.
• Details: An SLA should communicate shared expectations regarding service levels, including installations and changes. Exactly what will the provider control and where? Will the equipment reside on the provider's premises or the enterprise’s? What reports and information will be available to the company and how often? How will the provider respond to problems and how quickly? How does the provider measure network failures and what compensation is available when they occur?
• Choosing vendors committed to industry standards and open systems: If an SMB wants to move to a different vendor, they should be able to do that without worrying about new infrastructural investments. The fear of getting locked-in with one vendor because of huge costs involved in shifting vendors is often a concern while outsourcing IT solutions. The key here is to identify vendors that are firmly committed to industry standards and open systems. True standards bearers will always commit senior-level technical staff to standards efforts; function as officers (for e.g., chairs) and authors in standards-setting groups; sponsor public and private forums focused on standards adoption and promotion; contribute their own extension technologies to the development of new standards; allocate significant staff and systems resources for interoperability testing; closely collaborate with other vendors, and even competitors, in advancing standards; actively enlist customer and partner support and participate in shaping standards and delivering compliant products to market in a timely fashion.
• Rich Service set: Another important consideration before finalizing your partner is the managed services portfolio being offered. The service provider should offer a rich set of managed services so that as you start getting comfortable with the concept, the same provider can give you more services down the line. If the provider has only a limited set of services and doesn’t have the right vision you will face the risk of getting locked down with the wrong vendor. Managed service providers are looking at providing a rich suite of services that go beyond connectivity e.g. security, unified communications, healthcare, telepresence, education, WAAS etc to name a few. This is another major factor that an SMB should keep in mind while evaluating a managed services vendor.
• Security Savvy: Managing network security today requires more than hardware and software—it requires analysis and proactive advice. Enterprises should think more of skills and expertise rather than just equipment when considering what a security provider can do for their operations.
• Partners: Some service providers, such as telecommunications companies with a regional or national network, partner with other providers to extend their geographical reach. A service involving multiple providers and vendors can spread risk and provide redundancy. It can also slow reaction time or complicate matters in worst-case scenarios. Ideally, enterprises should consider a service provider that has built its own network. Among the benefits of such a partnership are end-to-end quality; simplified, cost-efficient network management; higher network availability; and more reliable, scalable, and secure services that are easier to deploy and expand as the organization's needs change.

The author is Head Managed Services, Cisco India & SAARC