Managed Services

As per B/OSS, Billing & OSS World, “To thrive, Managed Services move from a cost-based solution to revenue enablement.”

 According to Gartner’s Communications Industry IT Spending Forecast from the first quarter, worldwide spending on IT outsourcing will grow at a 5 percent compound annual growth rate for the next five years. Business process outsourcing will do better than that, at an 8 percent CAGR. Network outsourcing also is expected to grow, by a 6.4 percent CAGR.

 Amdocs’ survey data shows that two-thirds of service providers now support outsourcing, and not only from a cost-savings perspective. Their focus now is increasingly on top-line revenue generation initiatives. “Their goal is to find a way to get to a next-generation platform that supports growth,” said Kevin Freeman, manager of GSS strategy and marketing at Amdocs. “Service providers say, ‘let the experts take care of these systems.’”

 Service providers should look for the right level of enablement that helps them grow their business.

 As they do so, the way managed services are perceived is beginning to change, all the way down to the service level agreements. As SLAs change from an operations document to a business guarantee, service providers need to shift their thinking about managed services in general. They can’t look at it as a cost containment strategy only, but rather need a business outcome focus. They also don’t want IT to be a cost center anymore. It has to be about revenue enablement instead.

 Examples of deploying managed services to achieve specific business outcomes include:

• Supporting a business launch
• Modernization, then managed services
• Managed services, then modernization
• Managed services only: Primarily for managing legacy services with no modernization plans