Palatable or not, the long-term lifeline for a large segment of today’s IT channel depends upon cultivating a successful business that sells and delivers technology services on a recurring revenue basis. This objective marks a shift away from conventional reliance on product-based transactions and/or one- off project engagements to a more predictable operational model that charges customers much like a utility company bills monthly for services-rendered. Burgeoning trends such as cloud computing and mobility, combined with expanded customer choice for procuring technology, are factors hastening this transition urgency in the industry.
For many channel firms, a change in tack has meant a foray into managed services – either as an add-on part of an existing business or as a complete overhaul from what is being done today. The managed services model typically takes of the form of an ongoing contractual arrangement in which the third- party provider (or MSP) remotely monitors, manages and updates a customer’s technology infrastructure, systems and services such as email, ￼network and security software, or increasingly more complex pieces of technology such as line of business applications and analytics. IT functions once commonly handled in-house become outsourced, effectively.