Getting Past the Hurdles

Managed service providers must calm territorial IT departments to win business.

In an effort to lure car owners back to the dealership for repair and maintenance jobs, Ford came up with the saying, "Its your car, but its still our baby." A similar attitude is being voiced these days by some IT staffs whose bosses might be thinking about hiring a managed service provider (MSP). A companys network is the IT staffs baby; they know it best and sometimes they can get very protective.

In fact, for MSPs trying to gain ground, a disinclined IT staff can be a deal-busting firewall. Company executives, already possibly squeamish about letting outsiders gain access to the digital heart and soul of their business, sometimes follow the advice of IT staffers not enamored with yielding control to an MSP.

Get With It Take it from Stephen Elliot, the man widely credited with coining the term "MSP." The former Gartner Group analyst, now the e-services leader at InteQ—a former network and systems management consulting firm that became the worlds first MSP about three years ago—says reluctant IT staffs are a hurdle.

"Our biggest competitors are the traditional network and management tools already out there and, secondly, IT departments attitudes that they can do it themselves with the right budget and right staffing," says Elliot.

He and others say IT staffs intent on dissuading executives from hiring an MSP might contend their motives are purely corporate-minded. Theyll argue that those who built the network are best equipped to keep tabs on its performance. But their incentives are sometimes more self-centered.

"At a lot of companies, particularly if you go in at the wrong level on your sales call, they [the IT team] will say, "Wait, this guy is threatening my job. What is my incentive for telling my boss about this?" says Chris Kane, director of marketing communications for SiteRock, an MSP based in Emeryville, Calif. "That is definitely a problem."

Pitch the Benefits So far, SiteRock has been able to avoid "the control battle," says Kane. Its trick is to clearly inform potential clients that an MSP will free IT staffers from mundane system-management tasks.

Just as ASPs assert that outsourcing applications alleviates an IT department from running the treadmill of continual product updates, bug fixes and crashes, MSPs must stress an IT staffs skills should not be wasted on rudimentary infrastructure monitoring.

In some regards, IT anxiety to outsourcing is nothing new. The data center variety of outsourcing took off in the early 1990s on the heels of the leveraged buyout craze. Organizations loaded with debt were eager to get non-strategic assets off their books. But as the trend took hold, corporate and government IT managers began to resist the outsourcing movement as a threat to their livelihoods. In some cases, internal IT departments competed with outside contractors for outsourcing deals.

In addition, outsourcings potential for employee dislocation put unions on alert in both the United States and Europe.

"This isnt really all that different from the outsourcing world," says Carrie Lewis, a Yankee Group analyst. "When it comes to selling outsourced solutions, the biggest dilemma is overcoming internal resistance."

She says MSPs must be creative about finding ways to get in the door. They can form partnerships with data and/or Web hosting companies, employ targeted marketing approaches or make arrangements with established systems integrators. "They also have to make sure what theyre offering to the end user is something the end user is looking for," says Lewis, who asserts that sales strategies "are probably the weakest connection for MSPs."

Lewis says MSPs might consider the approach taken by Nuclio, an MSP thats working with GATX. She says Nuclio agreed to handle GATXs systems management only during off-hours of the the companys IT department. "Thats kind of a halfway solution," says Lewis. "Its creative. Meeting a customer halfway like that is a strategy MSPs are going to have to employ."

Meanwhile,the MSP Association is sponsoring a study that its members can use to show potential clients the "business value" gained from using MSPs, says Philip Little, the associations spokesman.

Kane and Elliot contend an MSP is least likely to ruffle ITs feathers if it sticks to basic "level one" systems management and doesnt try to work its way up the ladder into problem resolution and system design areas.

"Then it moves from process-driven to skill-driven," observes Kane. "There are quite a few MSPs who say, Well take all of the IT management headache off your plate, all the way up to level three. Thats what a lot of companies are concerned about."