MARCH 30,2022 | Kevin Gates

What are Managed Service Provider Companies and how do They Work? 

Although managed service providers (MSPs) have been facilitating thousands of businesses in the USA for years, yet they have come into the limelight after the outburst of the COVID-19. This is because they helped businesses in New York and in other parts of the USA to cope with the challenges of the pandemic. The transition of businesses from office to remote work created innumerable problems for small and medium-scale businesses. And Managed Service Provider Companies worked around the clock to make this transition as smooth as possible for their clients.  

Depending upon the requirements, the managed IT service providers either take over their clients’ entire IT operations or selective IT or business functions and oversee their smooth functioning on a day-to-day basis in exchange for a fee. A Company, for its part, turns to an MSP IT company to manage functions it isn’t staffed to support. Many small businesses, like clinics and local gyms, for example, have no IT staff on the payroll. And they can only manage their IT functions with the help of MSPs. Continue reading to learn in detail about MSPs and how they work! 

What Are Managed Service Provider Companies? 

A managed service can be defined as any business function that an MSP manages and executes for its customers. It is usually a non-revenue generating function of an organization that runs in the background, such as workforce management, payroll, IT management, etc. But here we will focus on MSPs as the IT service providers. 

Whether the organization is a small business or a large enterprise, IT infrastructure is the backbone of all businesses. In this world of modern technology, administering an internal IT environment is not only difficult but also costly and a time-consuming job. If you want to manage on your own, you need to have the right skilled workforce and the latest technology.    

   On the other hand, when you share your burden with an MSP IT company, you will not only save time but lots of dollars too. An MSP will remotely monitor and manage your IT infrastructure, usually for a monthly subscription fee. Depending on your requirements, managed service providers can either oversee a single IT function, like network monitoring or cybersecurity or oversee the entire IT environment.   

Assessing the Need for MSPs: 

In today’s competitive environment of business, managers are under significant pressure to meet deadlines. Also, while meeting these deadlines the performance, operational expectations, and security needs of the business must also be fulfilled. They're tasked to do all these things while trying to keep costs down. This is why, most financial experts suggest switching to a predictable cost model, like that of an MSP. The best time to consider speaking with an MSP is when you are:   

  • Setting future strategic goals

  • Deploying new services to your IT environment

Many times, your existing staff is not good with new technology, new services, and new applications. In such a situation, you can hire contractors to provide the service. But, given a static or declining budget, this will be even more expensive. Furthermore, this option provides less value in supporting company’s ever-growing performance goals which are true for small, medium, and large companies alike. 

How do MSPs Work? 

MSP companies offer all sorts of IT services to their customers against a fixed monthly subscription fee. They provide businesses with a recurring source of revenue that they can leverage to expand their businesses and to hire more employees. Also, when working with an MSP, your IT team will have more time to focus on your core business operations. 

The subscription model helps businesses manage their operational costs in a more effective way.  This is because this model ensures a predictable cash flow for the business. On the other hand, with the break-fix model cash flows sporadically which limits the ability of a business to plan and make business investments. Furthermore, MSPs offer a range of services, but their main service is remote monitoring and management (RMM). With a huge list of services, they can tailor custom-designed packages for their customers. 

The managed service provider companies vary in size from one-person shops to much larger enterprises with hundreds of employees. The Service providers can automate many of their IT management tasks using an RMM solution by using professional services automation (PSA) software. Hence, these tools allow MSPs to cater to multiple clients with only a limited workforce. If you are also facing difficulties in managing your IT infrastructure and want to outsource your IT task, choose BCP because they are the best service providers in the United States.