Definition of Managed Services

Managed Services is a term that can mean many things to many different people. Some uses of the term managed services do not have any hint of technology at all. The term managed services, as used in the technology industry, has a precise meaning particularly for those companies who call themselves Managed Service Providers (or MSPs).

Definition of Managed Services

The closest and best definition came out of a meeting of top MSP leaders over 10 years ago; this is the definition they created.

Managed Services is the proactive management of an IT (Information Technology) asset or object, by a third party typically known as a MSP, on behalf of a customer. The operative distinction that sets apart a MSP is the proactive delivery of their service, as compared to reactive IT services, which have been around for decades.

Managed Services Characteristics

Typically, MSPs will have the following distinguishing characteristics:

  • Have some form of Network Operation Center (NOC) service
  • Use a remote monitoring and management (RMM) technology platform to have visibility into their customer environments, wherever they may be
  • Have some form of service or help desk capability
  • Proactively, compared to reactive, maintain the objects under management for the customer
  • Recurring revenue. Most MSPs have ongoing billing relationships with their customers, as compared to transactional engagements. Deliver these solutions with some form of predictable billing model, where the customer knows with great accuracy what their regular IT management expense will be
  • Many people confuse cloud computing as a separate category of services, when most MSPs consider cloud computing to be a form of managed services

Managed Services Specialties

While the term MSP may be somewhat generic these days, there are many types of MSPs who deliver specific services or manage specific types of customers. Some of the more common types of solutions include security, storage, desktop, server, hosting, applications, and mobile device management. These specialities can be delivered to any type of customer. Today, cyber security is spreading throughout the global managed services community as customers from all geographies and vertical markets are struggling to stay ahead of cyber threats.

Managed Services Vertical Markets

Just like there are many types of service offerings, there are many types of vertical markets MSPs service. Industries such as banking, financial services, health care, and legal, are just a few of the vertical markets that have shown high demand for MSPs for the last two decades.

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6 Responses to Definition of Managed Services

  1. hfritts says:

    Managed Services should include network elements as well. There are many MSPs selling cloud services focused on network performance and data center demands.

  2. Jacob says:

    How big is the global managed services market in 2012/2013?

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  5. Manish says:

    Thanks for sharing the article! SMBs today face really tough time managing their IT infra in-house. But as their IT budgets are not huge unlike Large and enterprise size organizations, they find it difficult to outsource it to MSPs. How can we address this challenge?


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