37% of IT to be Outsourced by 2020

New research released today by ICT solutions and services provider Daisy , has revealed that UK mid-market businesses plan to outsource over a third (37%) of their IT environments to managed service providers (MSPs) in the next five years. The survey highlighted that cost reduction (67%) remains the biggest reason for IT directors turning to managed services. However, organisational agility (50%) and a drive to optimise existing IT resources (40%) were also cited as significant drivers. Interestingly, in the face of increased security threats, over half (55%) of IT directors said they are looking to MSPs to provide them with additional support.

“The combined business objectives of cost reduction and the insatiable desire to accelerate innovation mean the adoption of an IT managed service is becoming an increasingly attractive proposition for many organisations,” said Andy Bevan, Director of Client Solutions, Daisy Corporate Services. “At the same time, the risk of cyberattack – growing significantly and visibly over recent years – has prompted an increasingly stringent regulatory environment for all sectors; forcing organisations to jump through far more compliance hoops. As a result, many businesses are now finding that it is easier, and significantly more cost-effective, to outsource their security management to a service provider with the certifications and expertise necessary to tackle the rapidly changing threat landscape in order to protect their data, their customers, and their reputation.”

The research further revealed that the management of the network (56%), infrastructure (54%) and applications (53%) are the most common functions outsourced to MSPs today. However, looking to the year ahead, IT directors’ priorities are changing, with 58% highlighting application management as the main service they’ll be looking to outsource in the next 12 months. Service desk / IT service management (51%) and network management (48%) were cited as second and third most common functions likely to be outsourced. The survey also asked respondents what is most important to them when assessing the suitability of an MSP. Understanding the organisation’s exact needs ranked most highly, with nearly a third (32%) of IT directors rating this as most important. This was followed by the MSP’s security credentials (26%) and their sector and technology expertise (19%).

“In recent years we’ve witnessed a major drive within many organisations to become more agile and gain a competitive edge by transforming their IT operations,” continued Andy Bevan. “To support this goal, IT directors need to be able to allow their teams to focus on their core objective of delivering service excellence for the business, rather than expending time and energy on day-to-day, standardised routine operations. Their larger scale and high levels of IT industrialisation enables MSPs to bring a great deal of value to the table in the provision of datacentre, networks, systems, application and IT service management; taking a lot of the legwork away from internal teams. However, it’s essential to note that one size does not fit all, and there’s a major risk that outsourcing projects will fail if the service provider doesn’t fully understand the business and user requirements. It’s therefore critical that organisations look for an MSP that is willing to collaborate closely with their IT department, rather than offering a purely transactional relationship.”

The survey of 100 IT directors at UK organisations across multiple business sectors, and with more than 1,000 employees, was commissioned by Daisy Corporate Services and conducted by independent research company Vanson Bourne.

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David Dungay

Editor - Comms Business Magazine