While MSPs typically act as a cost-effective outsourced IT department to small and medium-sized business customers, there are also instances where an MSP supports customers that already have an in-house IT staff. In this latter scenario, the customer's internal IT team sometimes perceives MSPs as coming in to steal their jobs. However, MSPs can proactively avoid friction by taking a strategic approach.
Enter: co-managed IT services, or CoMITS, where MSPs look to build a cooperative and collaborative relationship with a customer's internal IT person or staff, thus easing potential conflict. The idea behind the CoMITS model is to fill in gaps within the in-house IT department, creating as little friction as possible while providing services, said Bob Coppedge, CEO of Simplex-IT LLC, an MSP based in Stow, Ohio. Coppedge is also author of the book The MSP's Survival Guide to Co-Managed IT Services.
Some eight to 10 years ago, Simplex-IT "stumbled onto a different way of approaching [the MSP-client relationship] where the internal IT department becomes an extension of our wing and vice versa," Coppedge said.
But Simplex-IT didn't begin marketing the co-managed IT services concept to customers until 2018. In 2019, the company started talking about the model with other MSPs. "Historically, [CoMITS] has been a red herring," Coppedge explained, but since formally promoting a CoMITS offering, more than half of Simplex-IT's new clients have adopted it.
Different approaches to co-managed IT services
Under the CoMITS model, Simplex-IT gives its clients' internal IT staff access to the MSP's software tools, as well as methodologies and procedures for using them, via a portal. Simplex-IT's approach is that clients "drink our Kool-Aid and, that way, they can pretty much continue doing their job, but do it using our tools," Coppedge said.
Simplex-IT also discusses the customer's IT requirements so they can "divvy up responsibilities as needed" between the MSP's staff and the internal IT staff.
When MSPs provide customers' IT teams with access to their tools, such as those for business continuity and disaster recovery, it eliminates silos, he noted. For example, if Simplex-IT is responsible for backups and the client has a problem with a server, Simplex-IT's team will have the visibility into the issue.
Coppedge said there are many different ways an MSP could approach co-managed IT services -- and CoMITS is not an approach every MSP can or should take. "It's all about relationships" and trust, he said. If an MSP and customer's in-house IT team are used to working independently and one side is afraid to trust the other, a cooperative relationship is going to be difficult to maintain.
"MSPs that are willing to share their knowledge, tools and adventure, for lack of a better word, and really want their client to succeed and aren't too concerned about finger-pointing or glory-grabbing are going to do well with CoMITS," he said.
RSM US, a Chicago-based consultancy for audit, tax, and managed and co-managed IT services, views CoMITS as "a collaborative effort between in-house resources and RSM, with the end goal of creating a unified, seamless IT function for the client," said Diego Rosenfeld, a partner. "We generally find that CoMITS clients have more complex technology needs and might be geographically distributed."
RSM's CoMITS offerings include global geographic coverage and 24/7 support, access to specialized and fractional resources, and industry know-how and best practices, Rosenfeld said.
CoMITS considerations for MSPs
MSPs that best fit the co-managed IT services model already have what Coppedge calls a "pure MSP practice" or dedicated MSP practice and can make CoMITS work in parallel with their existing practices. Simplex-IT believes CoMITS works best if the model is close to what the MSP is already practicing, he said.
Bob CoppedgeCEO, Simplex-IT
"You don't want to have two separate companies running simultaneously, because there will be no efficiencies there," Coppedge explained. For example, MSPs should price services, handle help desk tickets and track KPIs consistently across both their traditional managed services and CoMITS offerings.
Rosenfeld said CoMITS may not be the right approach for every MSP because the model "often means customizing your program and support technologies, which might not be in your wheelhouse." In CoMITS engagements, he said, MSPs often inherit clients' software and equipment, which requires MSP support teams to be versatile and dynamic. Some MSPs are uncomfortable with this model.
Additionally, in RSM's case, CoMITs clients tend to be larger organizations, "which could put strain on your help desk if you decide to onboard a new organization with 1,000 end users."
Deciding to offer CoMITS ultimately comes down to whether the MSP is comfortable managing a portfolio of heterogeneous clients in terms of services and technologies, Rosenfeld added.
How to combat common CoMITS challenges
There are two attitudes an MSP should look out for any time a customer introduces CoMITS to an internal IT department, according to Coppedge: "what's in it for me" and "not in my backyard." If an MSP doesn't properly manage those concerns, "you'll have pushback and problems."
You've got to have good answers," he said. MSPs need to ensure the internal IT staff understands they are trying to help with some of their pain points and not take their jobs.
Simplex-IT educates prospective customers by hosting a breakfast event every quarter. The event is aimed specifically at customers' internal IT people -- and CoMITS is not discussed, Coppedge said.
"We talk about three ways we can help them improve their jobs without [them] spending money on consultants," he said. These three ways are documenting, identifying single points of failure and improving relations with management. "[We discuss] very simple, common sense things, and the whole idea is to get internal IT people to meet with us, create trust and [gain] a sense of what we can do to make [their] lives easier and improve things a little bit."
In some cases, the relationship needs some oversight. The CoMITS model often exposes "seams" between internal IT and the MSP, Rosenfeld said. "It's critical that the client also designate a [vice president] or CIO-level resource to manage the combined team and/or a COO/CFO with sufficient technical sophistication and experience." The MSP can also offer up a virtual CIO to operate in this capacity, Rosenfeld said.
To avoid finger-pointing between teams, there needs to be strong governance, well-documented processes and responsibility assignment matrix charts, Rosenfeld said. Additionally, to ensure a successful implementation of CoMITS, both organizations need to already have in place a single service management platform to operate on, he added.
Echoing Coppedge, Rosenfeld said the best way an MSP can introduce CoMITS is by building trust, which can be demonstrated through the successful completion of smaller projects and, of course, good customer service. Then the MSP can begin discussing the advantages of CoMITS, he said.
"For example, RSM might help a client migrate to [Office] 365. Through this process, we establish relationships, come to thoroughly understand the client's technology and demonstrate to them the value of working with RSM," Rosenfeld said. "This enhances the comfort level significantly."