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What is the Difference Between Managed Services and Outsourcing?
Managed services involve a strategic partnership with a third-party provider that proactively manages an organization’s IT infrastructure and operations. Managed IT services providers offer a range of technology-focused services across IT consulting, business applications support and management, data engineering, workforce productivity, product development, cloud computing, cybersecurity, etc.
IT outsourcing involves hiring a third-party provider to perform services traditionally performed in-house. IT outsourcing partners often provide a 24/7 helpdesk to streamline and simplify the issues users face in their day-to-day tasks.
What is Typically Included in the Scope of Managed IT Services Providers and IT Outsourcing Partners?
Managed IT services often include ongoing support, maintenance, and monitoring of an organization’s technology systems. Instead of being specific to a particular department or system, managed IT services providers focus on the end-to-end management of the IT environment, helping customers meet their business goals.
IT outsourcing is often project-based, where specific tasks are contracted to an external provider. These can range from software development to technical support, infrastructure management, etc.
What Aspects do Managed IT Services Providers and Outsourcing Partners Focus On?
Managed IT services providers emphasize long-term partnerships and focus on improving technology efficiency, application uptime, and enterprise security.
IT outsourcing partners typically focus on resolving IT issues users face daily while reducing costs and maintaining application performance and functionality.
How do the Roles and Responsibilities of Managed IT Services Providers and Outsourcing Partners Differ?
With managed services, the MSP is responsible for outcomes and performance. MSPs agree on pre-defined SLAs with the customer organization and are required to deliver services based on the terms in the contract.
With outsourcing, responsibility may be shared or may also be with the customer organization. While IT outsourcing partners also agree on SLAs, there is far more customer oversight in delivering services.
What are the Differences in Cost Structures Between Managed IT Services and IT Outsourcing?
MSPs usually offer services via predictable, subscription-based pricing. Customer organizations can choose from a range of managed IT services and pay for the services they use annually.
IT outsourcing partners often charge customer organizations on project scope or hourly rates. Some also use a fixed-price model for projects with well-defined requirements and timelines.
