The changing nature of the managed IT service industry

The times they are a changing…

I have worked in traditional IT firms most of my life and the changes I have seen take place over the last decade or so are substantial. In the past, managed service IT companies played a tremendous role in IT management and support. Troubleshooting was actually a very marketable skill back in the good old days. But today, all that is changing and the biggest driver for this change is cloud computing.

SMBs and enterprise organisations alike are moving their IT workloads to the cloud, and the implications are manifold. Whether it is mailboxes, document management, video conferencing, accounting, HR, or any other IT-reliant business process, the age of “Everything as a Service” has come and the biggest challenge now lays with the traditional IT managed service business model.

Cloud computing is reshaping the IT business model as we know it, and for most IT companies still stuck in the past, the future may look very bleak. But if the Cloud Era is shifting paradigms, then there must be new frontiers and opportunities being created as well, or at least this must be the case if we consider the displacement theory. I believe the major new frontiers being presented that Managed IT Service Providers may explore include:

Business Productivity Consulting
Cloud computing comes with the inherent ambiguity that characterises all new things. As organisations both small and large look towards cloud services and web applications, the opportunity arises where IT support service companies can create additional value. This may be in the form of business productivity consulting. The new cloud era threatens to declare IT support companies redundant but this avenue creates a great opportunity for reinvention and a return to relevancy. When we consider the agility of small IT support firms, getting up on the learning curve is easier than for midsized and larger companies, and this opens the door for high-skill business productivity consulting as either an addition to traditional support or as a completely new line of business.
To put it down to product terms – the task of supplying an organisation with access to SharePoint or migrating their files to the cloud is much simpler thanks to Office 365. Working its an organisation to capture their business processes to build workflows, understanding their data so as to establish effective taxonomies, and overall working to improve the way they work – this is business productivity consulting.

Capacity Building
Adoption of new technologies within companies usually comes with its own set of challenges, and no one knows this better than IT support personnel. Cloud technologies are not any different and this puts IT support companies in a pivotal position to capitalise on capacity building issues. Perhaps as cloud technologies threaten to disenfranchise traditional support companies from mainstream IT, there comes the challenge to these companies to rise up and upgrade the competencies they already have, making them applicable to cloud technologies.
Whereas in the past support companies built capacity for locally installed software applications, the core competencies required to build capacity for cloud deployments remains the same.
In these two instances, what we see is a replacement of competencies and services but not the entire displacement of managed IT service providers.
In the best case scenario, the very advent of cloud computing is a boon for these sorts of service providers because their trust bank and legacy customers offer a truly strategic opportunity to rise again as the go-to source of technology know-how in this new cloud era.
This new challenge also affords support IT companies the opportunity to scale-up their skill sets, and give the much-needed link between the past and the future which is realistically what their customers are paying them for.

So what lies ahead for the IT industry? There have been reports predicting job losses, others predicting job creation.
One way or another tradition IT support is a dying art form – it’s time to ascend to the next generation of business requirements.