Co-Managed IT Service vs. Managed IT Service

Many modern companies rely on digital technology, but often, businesses need more IT capabilities than their in-house staff can provide. This puts companies in a bind. Should they commit to hiring more IT staff members? Or should they settle for making the most out of what they already have? A third approach is to outsource IT functions through the use of co-managed or managed IT services.

Managed and co-managed IT services are similar approaches with one major difference. As you can probably tell from the names of these services, managed IT services involve mostly handing off IT functions to a service provider, while co-managed IT services involve a more collaborative approach between a business and a service provider.

Managed and co-managed IT services can include a wide range of individual offerings. Some of the more standard services include:

  • Managed cloud services. More than just data storage, managed cloud services include performance monitoring and cybersecurity features.
  • Helpdesk support. When it comes to technology, things inevitably go wrong. Robust helpdesk support can assist with both quick fixes and long-term solutions.
  • Network management. This service keeps an eye on performance issues for your company's network and all of its connected devices.
  • Wireless access. Being able to access a network from anywhere is a modern expectation in business, and this service ensures that access is possible around the clock.
  • Cybersecurity. Sadly, the pandemic unleashed a rash of cybersecurity attacks, and the threat doesn't appear to be diminishing anytime soon. Including this as part of your service package provides tight cybersecurity in a way that's very convenient.
  • Backup and disaster recovery. Backups and disaster recovery are essential IT functions that are commonly outsourced to a service provider.
  • 24/7 network monitoring. Constant network monitoring is an excellent feature for companies with limited business hours.

The conventional way of using these services is a break-fix approach. This involves monitoring systems until there is an issue and then addressing it. However, some providers also offer more proactive services like:

  • Network assessment. Service providers can analyze your network and suggest ways to scale up, improve performance, and more.
  • Network design and installation. A well-designed network can set an emerging company on the path to rapid growth.
  • Consulting services. Bringing in outside expertise is a great first step for new initiatives and projects.

If your company needs more technical capability but hiring IT staff doesn't feel like the right move, outsourcing might be the best way to go. Deciding on co-managed IT services vs. managed IT services might seem like a complicated choice. To figure out what's right for your company, you need to understand the specifics of each set of solutions.

Understanding Managed IT Services

Using managed IT services is a bit like going to the barber or the hair salon. They have all of the professional equipment, the skills, and experience needed to give you a great-looking haircut. You don't have to bring anything. With managed IT services, everything is also taken care of for you.

This approach is great for small and mid-sized companies with a limited IT staff or none at all. These companies tend to focus on things other than technology, so investing in technical capabilities isn't central to their business model.

A typical managed IT services provider will handle the monitoring, managing, and maintaining of your IT systems. They can also proactively handle tasks such as network monitoring, software updates, security management, data backup, and disaster recovery.

If your company is considering managed IT services, you should know that it offers a few key benefits, including:

  • Cost-effectiveness. Managed IT services don't come for free, but they do provide a major return on investment. In particular, they avoid the fixed costs of having in-house IT staff and shift them to variable costs. Managed IT services also mean less downtime in many situations. Service providers typically provide around-the-clock monitoring and can update systems during a business' off-hours.
  • Better security. Because providers can offer around-the-clock services, it means they can provide around-the-clock cybersecurity. This is a great option for companies with limited business hours.
  • Scalability. When the scaling up of business activities requires a similar scaling up of IT capabilities, decisions have to be made. Hiring new IT staff members and making technology investments requires time. In comparison, managed IT services can easily and quickly accommodate changes. There's no need for new staff to get up to speed or for new hardware to be incorporated into the existing infrastructure.
  • Access to expertise. Managed IT services providers can offer access to a wide range of talented technology professionals. These professionals can draw on their experience and help your company avoid common mistakes. Some service providers specialize in offering unique capabilities that you can quickly access for projects and initiatives.

While quite a few businesses can benefit from completely outsourcing their IT capabilities, others may require some in-house staff members with IT skills. Companies that turn everything over to Managed IT services forfeit any internal expertise that might be needed to make sensitive and critical decisions. A lack of in-house expertise can be particularly problematic for companies that need to carry out strategic IT projects and initiatives.

Exploring Co-Managed IT Services

If using managed IT services is like going to the barber for a haircut, then using co-managed IT services is a little like hiring a landscape designer to redesign your backyard. With their experience, certifications, and training to aid them, they’ll come up with the plan and coordinate special services like excavators to grade the land. But you’re going to be the one laying the sod and spreading the mulch. The pros will do what the pros do, and you handle what you are equipped to handle. 

Under a co-managed arrangement, certain IT functions are outsourced to the service provider while the internal IT team retains control over the most important decisions and responsibilities. Co-managed IT services can provide a number of unique advantages, including:

  • Targeted enhancement of internal capabilities. Co-managed IT services enable businesses to make use of outside abilities to supplement their in-house skill sets. This benefit is specifically useful for businesses with a modest IT staff or companies that suddenly need specialized skills.
  • Technical flexibility. Co-managed IT services let an organization pick which IT skills it must have in-house and which are only needed from time to time. One strategy that quite a few companies use is to outsource lower-level tech support. This releases in-house IT staff to concentrate on strategic projects and vital functions. This approach also helps an IT department cultivate strategic campaigns that could significantly help the business.
  • Knowledge transfer. When people collaborate across departments or organizations, there is bound to be some degree of knowledge transfer. Organizations that use co-managed IT services expose their in-house staff to collaborators with different perspectives, experiences, and skills. If a company effectively engages with this aspect of co-managed services, it can permanently boost efficiency and quality.
  • Maintain high visibility. Compared to managed IT services, co-managed services allow for much greater visibility of an organization's network performance. A company can monitor network KPIs and consult with its IT partner on how to improve performance without having to turn over any sensitive data.

Because co-managed IT services are supposed to work together with an in-house IT department, your company must have an internal IT team. For some companies, maintaining in-house IT staff and hardware just isn't operationally or financially possible.

Co-managed IT services are customized by their nature, and this can make budgeting complicated. Depending on the structure of the service agreement, the costs of co-managed IT services can vary significantly. For example, if fees are based on the number of service hours provided, busy months could translate into high bills. While larger companies can handle these fluctuations, smaller companies may find them too risky.

The custom nature of co-managed services also means they could take a while to be properly set up. By comparison, fully managed IT services more structured to hit the ground running.

Making the Right Choice: Managed vs. Co-Managed IT Services

The choice between managed and co-managed IT services can be a difficult one. Each set of IT services is better suited to different types of businesses, and your choice should come down to your organization's specific goals and challenges that involve technology.

Making this decision should start with evaluating your in-house IT team's capabilities, experience, and workload. Next, assess your finances and find out how much you can invest in outsourcing IT functions. Take into account growth projections and scalability needs to figure out if one model or the other is better for your organization's expected future.

One of the most critical factors for determining which service to use is the amount of control you can afford to turn over to a service provider. If the nature of your business requires IT to have a hands-on approach, then co-managed IT services might be the best way to go. This is often the case in sectors where data security and responsiveness are major concerns. Conversely, if your company takes a more passive approach to IT, then managed services might be the better route.

Both managed IT and co-managed IT services can increase productivity and support various business initiatives. While managed IT services can allow a company to completely focus on its core activities, co-managed IT services let a company keep control over key aspects of its IT system.

Both approaches provide plenty of benefits and some drawbacks. Getting the most out of either approach often comes down to finding the right provider. This requires a bit of due diligence on your part.

When deciding on a provider, you ought to focus on companies that have clearly outlined and actionable service level agreements (SLAs). Even if the provider you choose has a sterling reputation and comes highly recommended, it's important to be able to hold the company accountable if you feel they are providing subpar service or their service resulting in losses. 

This accountability ought to include clear documentation of services rendered and regular reporting of system performance. If a service provider is hesitant to guarantee an acceptable level of transparency, you should consider looking elsewhere.

If your company is seeking proactive services, you should look at providers with a track record of strategically planning installation, upgrades, and initiatives. 

Prospective providers should also be able to understand your existing infrastructure and how it speaks to your organizational objectives. A good provider will also be able to plan beyond the immediate future.

The quality of different service providers can vary a lot. When it comes to a potential service company, you must be able to verify their qualifications with other companies in your field that are of similar size. 

Reliable providers should be able to provide examples of businesses similar to yours that they have provided services to in the past. They should also be able to provide individual references who can vouch for the provider's claims. If a provider isn't prepared to share these kinds of references, they're probably a poor choice.

Let Taylored Systems Help Your Company Decide on Co-Managed IT Services vs. Managed IT Services

At Taylored Systems, we've helped Indiana companies of all shapes and sizes with IT services. Our team uses our experience when it comes to helping new clients.

If you aren't sure whether co-managed or managed IT services are right for your organization, contact us to schedule a consultation. We can listen to your needs and current capabilities, then design a solution that best fits your organization and its mission.