Blog Series: Managed Services Study 2022

How Managed Services Providers Deliver Identifiable Added Value

When companies digitalize, the path today usually leads via cloud solutions. And since very few companies are implementing this transformation on their own, managed services providers (MSPs) are more important than ever. This is confirmed by the “Managed Services 2022” study, which NTT DATA Business Solutions Germany conducted together with the team from CIO Magazin, CSO online and COMPUTERWOCHE: 78 percent of respondents use additional services when moving to the cloud, and 79 percent additionally obtain (strategic) consulting services.

Laptop, notebook and survey chart on a table represent the managed services study by NTT DATA Business Solutions

The study initiated by NTT DATA Business Solutions Germany identifies the most important success criteria for working with an MSP, the added value of outsourcing, and what the situation is with regard to data security and data protection in the context of managed services.

In addition to the assessments and experiences of the surveyed companies, we would like to present our view as a managed services provider. That is why we are supplementing the survey with a series of interviews – in the third part with Matthias Sigmund, Innovation Manager within Global Managed Services, and Yvonne Kern, Account Manager Managed Services at NTT DATA Business Solutions AG.

"With all the enthusiasm for innovation - in companies, the balance between costs, resources and system stability has priority; proactive measures, innovations and further added value for the business only come after that."
Bild von Yvonne Kern, Account Manager Managed Services
"As a globally positioned full-service provider, we can provide expertise and know-how in all conceivable SAP solutions and modules. This speeds up the solution finding process enormously."

Yvonne Kern Account Manager Managed Services

Mr. Siegmund, costs, organization, strategy, personnel and service quality: companies expect visible added value and concrete business benefits from working with an MSP in these areas. At the top of the list (51 percent) is the expectation of greater cost transparency and easier IT controlling. From the perspective of an MSP: What does this transparency look like?

Matthias Siegmund: When companies take an MSP on board, two key basic expectations are falling costs and greater resource efficiency. Customers can see how these factors are doing via dashboards and ad hoc reports. These tools make the status transparent: customers can see the status of their KPIs, such as solution speed and end-user satisfaction. They also see which services generate which costs – important for controlling.

Evaluating the qualitative added value that an MSP continuously provides is a bit trickier. For example, the question of how many ideas were proactively contributed to the further development of the system and actually implemented. Here, the expectations of companies have rightly changed, and they see successful collaboration as a selection criterion. The MSP is expected to contribute his own solutions and ideas. However, the ultimate business added value, i.e., which building blocks have contributed how much to the company’s success, is difficult to quantify.

Let’s go back to the basic expectation: Despite all the enthusiasm for innovation, companies give priority to the balance between costs, resources and system stability; only then do proactive measures, innovations and further added value for the business come into play.

54 percent of the people surveyed hope for better software quality. What can an MSP usually do better here than internal IT?

Yvonne Kern: Our company benefits from two factors: firstly, from major scaling effects and experience from other industries, and secondly, from completed and ongoing customer projects. As a global full-service provider, for example, we can provide expertise and know-how in all conceivable SAP solutions and modules. This speeds up the process of finding solutions enormously. This is a scope that cannot be covered by an internal IT department. In addition, the demands on IT departments are growing due to shorter release cycles and a continuous stream of new features. On the one hand, these increase the performance of the software solutions, but on the other hand, they regularly produce stress and time pressure in the internal IT. This is where an MSP provides relief with its combined release and deployment management – and thus demonstrably ensures better software quality.

Customers expect an increase in responsiveness and adaptability when working with an MSP. How can this increase be seen in facts and figures?

Matthias Siegmund: It’s true that customers in an MSP partnership focus on quick problem resolution and the direct availability of experts. They also want to avoid lengthy “ticket ping-pong” in the case of an incident. But in our view, this is not enough – a proactive model is needed: We bring in our monitoring and our experience from other projects and industries to solve problems before they become bigger or cause damage.

One example is process improvements. When we receive multiple tickets on the same issue, it shows that a process can be optimized. Problem management starts to achieve measurable improvements. If we invest effort in this area and users subsequently feel more comfortable, the number of incidents and “how-to” questions will be reduced in the future – and the costs for reactive support will drop. Such success requires a certain period of close cooperation. Additional training for users and enablement, i.e., help for self-help, for example through self-services, are ideal.

The MSP with consulting expertise as a strategic partner: What do you mean by this?

Yvonne Kern: First of all, the customer must see the MSP in this strategic role. For this, the partnership must have a certain maturity – and not just focus on costs. NTT DATA Business Solutions sees itself as a strategic partner that combines the advantages of standardization and flexibility in solution design. We regularly go beyond initial expectations and scope. For example, in innovation workshops we show customers the concrete use of modern technologies and how they can bring real added value – from buzzword to business opportunity, in other words.

On what topics do companies currently have a great need for consulting?

Matthias Siegmund: At the moment, a lot of the focus is on the question of how new cloud technologies can help the company. We have had good experience with an iterative approach, starting with smaller proof-of-concepts and pilot projects to quickly demonstrate successes, through to holistic classification and development. This requires a relationship of trust and the will within the company to “go to the next level”. The upcoming switch to SAP S/4HANA for many companies also generates a number of questions and challenges. Especially if ongoing operations are to be affected as little as possible.

However, we also provide insight into trend topics such as IoT and AI – and can evaluate possible added value for the customer. Small, short-term optimizations are also effective. A good example is Robotic Process Automation (RPA). As soon as tickets or process KPIs indicate that a manually-driven process is unnecessarily eating up time or is error-prone, this technology can help. RPA can be implemented quickly and cost-effectively – and experience shows that automation has a noticeable effect.