Shared Services Vs Managed Services
What kind of services do you need? The answer might vary depending on several factors. These might include the number of employees at your company, the level of expertise among your current team members, the skill gaps you want to address, budget constraints, or the overall business goals.
Typically, a company can have two choices: Shared Services vs Managed Services. What are Shared Services, And What are Managed Services? Will discuss this in the article.
What are Shared Services?
Shared services is a term used to describe the outsourcing of business processes and functions that can be performed by multiple organizations but require coordination to achieve optimal results. The concept of shared services has been around for decades. Still, it was not until recently that companies realized its potential as an effective cost-saving way to improve service quality.
The main advantage of the shared services model is that they allow businesses to focus on their core competencies and outsource non-core activities. This will enable them to concentrate on what they do best rather than having to manage a variety of different tasks.
What are Managed Services?
Managed services are yet another type of shared service, but this time they’re offered by a third-party provider instead of being done internally. Managed services are similar to shared services in that both involve advanced outsourcing of certain aspects of your IT infrastructure to a third party. But managed services are generally offered by a third party, such as a cloud computing provider, whereas internal teams typically provide shared services.
For example, a managed services provider might provide network management, security monitoring, application hosting, email support, etc. These services are typically outsourced to a third party so that the client’s IT team does not need to worry about these issues.
The additional benefit of managed services is that you don’t have to manage your IT infrastructure. Instead, you pay someone else to take care of it for you. This frees up your IT team’s time to focus on other things. It also helps you avoid making costly mistakes.
Shared Services Vs Managed Services
A common misconception is that managed services are just like shared services. But there are some key differences between the two. Here are a few examples:
- Shared services are typically provided by an internal team, while a third-party vendor typically provides managed services.
- With shared services, you can choose what services you want to outsource. But with managed services, you get all or nothing.
- Shared services model, the vendor will handle everything related to billing and invoicing. But with managed services, you have to do those tasks yourself.
- For shared services, your vendor will manage your servers and networks. But with managed services, your vendor doesn’t own or operate your servers.
- For shared services, vendors usually charge per hour. But with managed services, the price varies depending on how much work needs to be done.
- With a shared services model, customers must sign a contract. But with managed services, there is no formal agreement.
- Shared services model, contracts are usually long-term. But with, managed services tend to be short-term.
- Shared services model, there is usually a minimum number of users required. But with managed services, companies are not uncommon to use managed services even when only one user exists.
- Shared services model, most providers require upfront capital investment. But with managed services, these costs aren’t always included in the initial cost.
- With shared services, clients need to provide their hardware. But with managed services, clients often rent equipment from the vendor.
Which one to choose: Managed Services or Shared Services?
If you’re looking for a way to cut costs, then managed services may be right for you. However, shared services might be better suited for you if you’re looking for something more than just cutting costs. The choice depends on your specific situation.
Internal service providers are also responsible for meeting managed service KPIs, controlling costs, and providing high-quality service.
How to Choose the Right Business Model
When choosing which services business model works best for your company, consider the following factors:
- Are you looking to save time and money now? If so, then managed services may fit the bill. But if you’re looking to grow your business over time, then shared services may be a better option.
- Is your budget limited? If so, then shared services may make more sense. But managed services may offer greater benefits if you have plenty of cash to spend.
- Does your company have any unique requirements? If so, then managed services would be a good fit for you. But if not, then shared services may also be an appropriate solution.
- Will you outgrow your current service provider? If so, you may want to choose managed services. But if not, you may be able to get by with shared services.
- What kind of support do you need? Shared services may work well for you if you don’t need 24/7 technical support. But if that’s what you need, then managed services may be a better option.
In conclusion, both models can be used successfully. It all comes down to finding the right balance between cost savings and growth potential. If you think managed IT service providers can benefit your business, take advantage of our free consultation.
