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How Managed Services and Cloud Technology Can Compliment Each Other

Cloud TechnologyIt is becoming apparent that many MSPs in the marketplace today are making a distinction between cloud technology and managed services that is actually hindering rather than helping their bottom lines. The prevailing view seems to be that customers want to either go with managed services or want to make use of cloud technology solutions, and that these two types of service are in competition with each other.

The fact of the matter is that customers don’t generally care what’s going on under the hood, as long as they get where they want to go. Customers want solutions for their business problems, irrespective of the technology being used. Understanding that both managed services and cloud technology are complementary components of a comprehensive, customer-based solution strategy is key to opening up new, more agile business models to MSPs who want to remain competitive.

Cloud as a Core Component

Cloud technology, rather than being an outsourced add-on that MSPs can offer their clients, should be a core component and part of a robust and flexible suite of solutions available from the outset. There are some use cases best served by managed services, and others that are better dealt with by cloud services. Clever MSPs are increasingly able to offer both in-house, and are providing the option on a wider scale than their competition.

The problem with widening the scope of offerings in this way, some MSPs point out, is that cloud technology requires more clients than managed services to be financially viable. It’s generally accepted that a cloud services provider needs to engage more than the 50-100 clients to make managed services profitable. Many smaller MSPs aren’t prepared to or capable of expanding their operation to accommodate the increase in client base.

Making a Larger Customer Base Work

There are ways to make a larger customer base work without significantly increasing the scale of operations:

  • Specialize in niche areas of cloud services such as security or compliance
  • Focus on high-growth areas such as application development
  • Be willing to branch out into new technologies and ecosystems
  • Run as efficient an operation as possible by making use of professional management tools
  • Identify the elements that can still be outsourced to reduce costs and inefficiencies as much as possible.

Running a lean, focused operation is an effective way to be able to offer clients as diverse an array of complementary services as possible while maintaining solid profitability.

Big Data and Creativity

Big DataWe’ve all heard about how important it is to be able to collect and process vast amounts of data in real time, and about the impact big data has had on businesses in the past few years. And it’s true that in many industries, it’s impossible to remain competitive without being able to handle those large data sets. Attempting to operate without the amounts of information the competition has at its disposal is next to impossible.

Big data is important – perhaps even indispensable – for business, but it’s a death knell for creativity if used in the wrong way.

Not All Industries Are the Same

All businesses need to remain profitable, but not necessarily to the same degree. Certain industries are fundamentally different. Health care, education, and the entertainment industry all affect society at a fundamental level, and if any of them are run purely from a profit maximizing standpoint, society suffers.

A House of Cards

The original Netflix series House of Cards has become an enormous hit since its debut 4 years ago, surprising everyone except its creators. They knew it would be wildly popular, as they had used sophisticated data tools to analyze Netflix viewers’ viewing data for the previous several years to guide the creative process.

While this has resulted in a very successful series this time, there is a fundamental flaw in using big data in this way, in an industry built on a foundation of creativity.

The process the House of Cards producers followed can really only result in giving people more of what they already like. There are only so many permutations of the same thing possible to make, and eventually the people will become bored.

Pattern Recognition

The real power of big data tools is in being able to sift through huge amounts of information and identify patterns in that information of which people would otherwise be totally unaware. This enables the ability to take action and make decisions that leverage the beneficial patterns and eliminate or minimize the damage of the negative patterns. When big data is harnessed in a creative pursuit, it does what it is meant to do: identify patterns. The only thing this generally allows the people involved to do, however, is recreate those patterns.

Art Is Different

Art is necessary for the healthy functioning of a society. Without creativity, new expressions a culture wither and die. Big data can be a very useful tool on the business side of the creative industries – marketing, distribution, that sort of thing – but for the sake of creativity itself, it has no place in the creative space.