Each year, a growing number of companies increase their number of branch locations -- and with that comes the need...
to extend IT services to these remote offices.
But a tough economy has created a double-edged sword for these companies. One the one hand, limited budgets mean hiring freezes, which makes it difficult to extend IT staff and services to branch offices. On the other hand, with tight finances it is more cost effective to move employees to home offices or existing branch offices in order to reduce real-estate costs or travel expenses.
This conundrum means that while 62% of organizations increased the number of branch-office locations from 2006-2007, 82% of companies with branch offices are lacking on-site IT expertise
Enter the managed service provider (MSP), VAR or systems integrator. IT consultants are now moving beyond build-out and into bandwidth and application management, as well as network management, for branch offices and other remote locations. They're doing so in response to growing demand. Sixty-five percent of organizations are now using or evaluating some flavor of managed service at one or more of their branch locations. Those using third-party services extend them to 89% of their locations.
Where do companies need branch office network services?
IT consultants can help their customers draft a plan to address build out that will include appropriate management services. That decision about which branches actually need services can depend on a number of factors.
Nearly half of organizations simply extend managed services to all branches. But for 29% of organizations using managed services, location and available staffing are the determining factors. Typically, they use managed services for remote offices with little or no IT staff on site or nearby. They also identify branches that only need help with selected services, but can't justify a full-time IT employee.
Other organizations outsourced branch office network services necessary based on the applications in use by business needs. For example, a branch office that operates as a contact center may rely on managed VOIP services to ensure high call quality. Contrary to what many believe, the size of the branch rarely plays a role in this decision.
Offering the right mix of branch office network services
Organizations need various types of managed network services for the branch office. Just because customers use MSPs doesn't mean they necessarily want to offload everything to them. In some cases, MSPs handle WAN services while the internal IT staff oversees infrastructure and applications. In other cases, MSP handle troubleshooting and installation, but internal IT addresses ongoing management and monitoring.
Of organizations using managed services, 82% choose managed router and network support. Nearly 36% need end-user/desktop support. These services include helpdesk, training and software support. Thirty-three percent of companies use IP-telephony management services -- a significant increase from early 2008 when only 22% used managed IP telephony, and an even bigger increase from 2007, when only 14% sought these services. The use of IP telephony managed services is expected to continue increase as more companies deploy the technology and integrate it with other UC applications.
The right provider for the right service
Organizations are very thorough in assessing their needs and taking time to find a provider (or multiple providers) that offer the right combination of services. The type of provider they choose depends mostly on the services they require.
MSPs include carriers, vendors, systems integrators, value-added resellers and traditional outsourcers and the lines often blur between what providers typically offer.
Carriers have generally focused on network-based services, such as router management, WAN management, and implementation. Systems integrators focus heavily on design and build, whereas outsourcers address network, security, or application management. Vendors and their resellers typically offer assessment, installation, training, break/fix truck rolls and ongoing management. But many providers have built partnerships with others that offer complementary services (e.g. carriers with outsourcers) to offer a wider management portfolio.
Proving you're qualified to offer branch network services
Beyond the services solution providers offer, customers consider additional selection criteria when choosing outsourced network management services. They consider whether partners have strong security policies and can meet compliance demands. They also seek partners that support multivendor solutions, and that have the right certifications and training.
Ultimately, outsourced branch network management is most successful when solution providers take time to assess the needs of their customers, evaluating where they need help, and what they can handle internally. IT consultants can make customers more comfortable with this type of business model by offering referrals from existing customers and peers, and then sitting down to determine a plan.
Katherine Trost is a research analyst at Nemertes Research, where she focuses primarily on professional services.