I recently read a study from a research and consulting firm MarketsandMarkets and they are predicting huge growth in the managed IT services market. The research predicts a jump from $142.75 billion this year to $256.05 billion in 2018, at an estimated compound annual growth rate (CAGR) of 12.4 percent from 2013-2018.
According to the study, managed IT services reduce in-house IT costs by 30 to 40 percent and brings a 50 to 60 percent increase in operational efficiency. Organizations implementing managed services look forward to risk sharing and to reduce their IT costs and IT commitments, so they are able to focus on their core competencies. Businesses have accepted managed IT services as a means to enable them to reduce their capital expenditures (CapEx) and free up internal resources. They are also expecting North America to be the biggest contributor to the upcoming growth in all industries.
They said:
With increasing technological advancements and the cost challenges associated with having the IT services in-house, the future seems optimistic enough for application services providers and managed services providers.
I have seen a lot of talk lately about how big tech companies are doing poorly even though the economy is improving. IBM shares have lagged the market this year, Cisco is laying off 4,000 workers, and HP is still trying to find a way to diversify beyond the decay of the PC market. Why is this happening? One of the reasons is managed IT services. Customers are starting to realize they don’t have to buy new equipment every year or three years to get the results they want. They are learning that if they get the correct business processes in place they can get a better ROI on the IT infrastructure they have already purchased. Customers are getting smarter and big tech companies are feeling the pain! They are not adapting to what the market wants.
We saw this change coming in the market around 2000 and have since shifted our focus to better serve our customer’s needs by proactive services. The question you have to ask yourself is: The managed services ship is sailing… Are you on board?
