1 Five traits of a world-class managed services provider As more companies choose managed services for communications, they should be very specific about what they need and expect from their service provider.
2 Large and midsize businesses are increasingly turning to managed services providers (MSPs) to operate and maintain their enterprise communications systems. Companies that outsource to MSPs can benefit by: Reducing their operational costs and increasing network and application reliability. Leveraging MSPs to help manage the complexities of integrating new and legacy technologies across multiple platforms. Accelerating the business through a shift to unified communications environments while reducing overall risk and realizing full productivity earlier. Cost reduction and service reliability remain key reasons why companies turn to managed services. However, MSPs can help companies add business value in other ways as well, including transformative initiatives that support revenue and profit growth. Mobile solutions, videoconferencing and other unified communications tools boost collaboration and productivity while reducing travel expenses and improving personnel management. An overextended IT department can be relieved of a significant systems management burden, allowing key personnel to focus on strategic priorities. An often-overlooked consideration in choosing an MSP is that different providers focus on different priorities, such as specific product families, cost containment or risk mitigation. MarketBridge, a brand research and management consulting company, recently conducted competitive research for Avaya to learn more about current vendor offerings and help identify attributes that IT executives should look for in a managed services relationship. This white paper discusses five characteristics that were identified as traits of a world-class managed services provider. A brief look at the spectrum of MSPs According to Gartner, Inc., nearly half (48 percent) of U.S.-based organizations plan to increase their use of managed services. By doing so they hope to overcome some of the barriers to adopting nextgeneration technologies, including 2 avaya.com
3 large capital investments and spending for training and tools. They also hope to rein in lines of business that are pursuing their own technology plans unaligned with overall IT strategy. While planning to expand use of MSPs, cost-conscious organizations are taking a close look at their provider relationships, including traditional MSPs, systems integrators and providers of direct manufacturer support. The MarketBridge survey sought to identify how leading MSPs are focusing their offerings and services. One category of providers stresses their support for business transformation, including expertise in unified communications and contact center applications, and their willingness to share risk with clients through flexible arrangements. Another category focuses on cost control, service predictability and transparency, along with multivendor support. And a third category focuses on using their expertise to help customers capture the benefits of their own technology investment. Traits of world-class services providers To many, outsourcing and managed services are the same. However, many of today s businesses do not necessarily want a service provider to simply take over their operations. Rather, they may just want a provider with the expertise and resources to address network and application performance according to established metrics. For example, instead of contracting with an MSP to totally take over a contact center, a business may want to keep tight control over what the center does and how it operates, directing the MSP to meet specific criteria, such as call handling times and how to handle alarms. In this new, more demanding environment, the MarketBridge survey revealed five traits that stand out as indicative of a worldclass services provider: a focus on customer performance and growth, superior application management, flexibility, accountability, and standards-based services. Focus on customer performance and growth Reducing costs and improving efficiency are objectives of virtually all managed services arrangements. World-class MSPs address these priorities, but they also help businesses use advanced applications, such as unified communications and contact center technologies, to drive top-line revenue growth and bottom-line profitability, improve the return on current investments, and increase employee productivity. This trait helps fill a growing need in the market: Many companies are challenged with deploying the component applications of unified communications, such as video, instant messaging, presence, Web collaboration, voice and mobility, and they are unable to achieve the effects of fully deployed seamless implementation and operation. For example, Session Initiation Protocol (SIP)-based technology can help companies deploy more enterprise communications solutions that promote mobile, nimble workforces that can quickly seize 1 avaya.com 3
4 Next-generation unified communications and contact center solutions enable businesses to conduct integrated, personalized and real-time communications using video, voice, data and other channels. However, these solutions aren t simple. business opportunities. But cost-effective transition to SIP requires a defined road map to avoid being overly capital intensive or disruptive to the organization. An MSP can develop and manage the entire SIP-based unified communications or contact center solution using a predictable, per-user, per-month pricing model. The customer doesn t have to deal with refreshing the operations team s skills or ongoing software and hardware updates. A world-class MSP can also guide the transition to new technologies in contact centers a major user of communications and computing resources in many organizations. The MSP can manage deployment and operation of Web-based applications and the integration of social media into the center, enabling such activities as monitoring and responding to customer tweets and Facebook postings. This allows the MSP s customer to take advantage of leading-edge technologies in a timely manner and address the latest market trends both quickly and without an outlay of capital investments. Characteristics of a world-class MSP that contribute to performance and growth include: Ability to provide multivendor support A managed services platform that can quickly adapt to emerging technologies A strong focus on applications in addition to network elements A strong focus on user experience monitoring to address actual and perceived service level performance Personnel who understand how to improve overall solution performance Superior application management Next-generation unified communica- tions and contact center solutions enable businesses to conduct integrated, personalized and realtime communications using video, voice, data and other channels. However, these solutions aren t simple. World-class MSPs are staffed by highly skilled personnel who under- stand both the backbone network 4 avaya.com
5 and the applications it supports. Moreover, they understand how to optimize application and network performance in alignment with the objectives of the business and the needs of the end users, both within the business and with outside users such as suppliers and customers. The MSP can execute site-by-site cutovers with awareness of how changes affect existing systems so disruptions for users are minimized. They can then manage and monitor operations going forward so peak user productivity is possible. An MSP can also keep the customer s IT department abreast of the latest application developments, supporting the continuing evolution of unified communications and call center environments. For example, once a company has enhanced its contact center with instant messaging, it may want to bring in Twitter feeds. Or it may want to deploy the infrastructure for video kiosks or mobile applications in the unified communications environment. Leading MSPs understand how different applications fit together to improve the performance and productivity of both the contact center agents and the broader workforce and can provide a road map for implementation. Factors to consider in assessing the application capabilities of an MSP include: Staff experience The number of customers, ports and seats the provider manages How well the provider understands SIP What standards the provider applies to its services Flexibility Businesses want to leverage managed services in different ways. One may be standardized on a single vendor s equipment and software, while others may have multivendor environments. One company may want to mix new technology with its existing systems so it can wring more from past investments while charting a future course. Another may want to take advantage of cloud computing. One organization may want an MSP to take over all its networks and applications, while another wants to pass off only a portion. World-class MSPs offer flexible options that meet these needs. Services can be customized based on the customer s specific requirements, from simple system monitoring or hosting to total infrastructure outsourcing. Services can be segmented within an organization by operating units, services, geographies or applications and can be delivered on premise, remotely or in the cloud. Flexible procurement and financial options are also key. Approaches can include capital expenditure, operating expenses or leasing, as well as assets-on-books arrangements that include professional and implementation services in an overall agreement. Other options may include customizing a scope of work to service level agreements (SLAs) and specific service definitions, such as moves, adds, changes and special requirements. In a call center, the MSP may take over both service desk calls and end-user calls, freeing internal staff. avaya.com 5
6 Among the traits of a flexible MSP are: Buy and/or build arrangements tailored to a customer s spending model Pricing models that accommodate the changing needs of the customer Technical and business experience and capabilities that minimize the learning curve at the beginning of the relationship and adapt to changes in the customer s business over time Customizable services Accountability Historically, managed services arrangements were akin to what is today considered outsourcing. An MSP would take over full management and operation of functions such as network services or contact centers. Now, however, organizations face greater accountability demands from shareholders, regulators and other stakeholders. In turn, they are demanding greater accountability from MSPs. In today s world, businesses want to maintain control over their environments while still shifting operational responsibilities and risks to MSPs. They want to specify what functions an MSP will perform and how, and the MSP is held accountable through contractual SLAs and other controls, including financial penalties for underperformance. A key differentiator of a world-class MSP is that it provides strong governance and is a trusted, accountable adviser. Such a provider is not just a vendor but an extension of the customer s IT department that also makes recommendations on the organization s technology road map. The MSP understands the customer s business applications and what they mean to the customer s broader value chain. It can advise on solutions the customer can implement and use to better drive business performance, extend capabilities 6 avaya.com
7 and reach new markets. And it understands the controls needed to meet expanding regulatory requirements. Among accountability features to look for in an MSP are: Customer control and a customer-facing Web portal Full transparency of tools, processes and knowledge A real-time network view Performance guaranteed through SLAs Standards-based managed services Managed services relationships can dissolve for reasons such as an actual breach of contract, a customer perception of a breach or failure to meet the financial goals of the pact. In any of these cases, the primary cause of problems is often a lack of alignment between the MSP and customer on the definition of terms. Common terms such as capacity and configuration appearing in a statement of work can be surprisingly open to interpretation. The use of standards especially one as widely recognized as the Information Technology Infrastructure Library (ITIL) can help overcome these issues. Standards help specify what an MSP will do when it says it will monitor, operate and optimize a network based on agreed-upon and documented prerequisites. It is important to remember that an MSP that provides part of the solution is likely to end up part of the problem when issues arise. Unless the provider is willing to take on multivendor accountability, finger pointing will inevitably ensue the network vendor says it s a router problem, the router maker says it s in the PBX, and so on. Key features of a standards-based approach to managed services include: Use of ITIL definitions Agreement on nonstandard nomenclature Responsibility for multivendor environments accepted by the MSP Face the future with the right MSP partner Businesses are looking for more than reliability and cost reduction from MSPs. Today they want help in transforming their organizations, deploying new technologies to gain competitive advantage, and using communications to increase productivity and collaboration. World-class MSPs offer superior application management and network expertise across multivendor environments, as well as flexible options that meet a variety of needs. Services can be customized based on the customer s specific requirements segmented in many ways and delivered on premise, remotely or in the cloud. Clear understanding of additional pricing for incremental tasks avaya.com 7
8 Not all MSPs are equipped to handle the job. Those that are will have the capability to support a customer s growth and profitability goals, a real focus on application expertise, flexible arrangements, the willingness to demonstrate accountability, and a standardsbased approach that avoids confusion and promotes an open relationship. By considering these five traits of world-class MSPs, IT executives can be better prepared to make a choice they and their organizations can thrive with both near-term and over time. About Avaya Avaya is a global leader in business communications systems. The company provides unified communications, contact centers, data solutions and related services directly and through its channel partners to leading businesses and organizations around the world. Enterprises of all sizes depend on Avaya for stateof-the-art communications that improve efficiency, collaboration, customer service and competitiveness. For more information, please visit 8 avaya.com 2011 Avaya Inc. All rights reserved. Avaya and the Avaya logo are trademarks of Avaya Inc. and are registered in the United States and other countries. All trademarks identified by, or SM are registered marks, trademarks and service marks, respectively, of Avaya Inc. All other trademarks are the property of their respective owners. Avaya may also have trademark rights in other terms used herein. References to Avaya include the Nortel Enterprise business, which was acquired as of December 18, /11 SVC4719