In the second of a regular series of articles seeking to identify growth areas for channel partners in 2013, Irish Computer asked a number of resellers, distributors and vendors for their views on the opportunities presented by managed services, managed print services and virtualisation.
MANAGED SERVICES
Karen O’Connor, general manager service delivery, Datapac
Datapac has experienced a very significant increase in demand for managed IT services and outsourcing in 2012, O’Connor says, and the expectation is it will continue and accelerate further in 2013.
She believes Irish businesses of all sizes will look externally for help managing their ICT and print infrastructures. Irish public sector organisations will look to managed service providers (MSPs) to help manage and utilise their IT environments more effectually, O’Connor adds, and gain increased cost savings.
Datapac also envisages another significant trend that will be businesses choosing to source ICT talent from organisations like Datapac to work onsite for short or long-term projects. "Contract durations are being driven by the need to keep service levels consistent, yet with the added flexibility to meet changing customer demands," O’Connor claims.
The importance of retaining a close relationship with an MSP is also being influenced by the ability of the provider to consult on capital expenditures to realise greater efficiency, cost savings and productivity, she adds.
Big ticket expenditure on next generation technologies is still a regular occurrence and the MSP will play a greater role with regards to how technology will be implemented and managed. MSPs will work in conjunction with the existing environment to realise the best return on investment.
As a reseller in the Irish business market, Datapac is acutely aware that it needs to be able to provide more than the latest products. "We have continually invested in our systems and people to ensure we have a highly accredited, knowledgeable and experienced managed service delivery team," O’Connor claims. Expertise adds real value to its relationships with customers, who see it as their technology partner and trust Datapac to manage their ICT environments, from the server to the desktop and to mobile devices. "Our managed service proposition ensures customers can get the most from their infrastructures, allowing them to focus on their core business," she adds.
Mary Bradshaw, managing director, Damovo Global Services
Bradshaw says managed IT services will continue to grow significantly in 2013. As a global service provider, with a significant Irish operation, Damovo regularly meets with the CIOs of some of the world’s largest global businesses. It also meets regularly with a partner base of leading communications companies across the world such as HP and BT.
"We get to discuss at first hand the key trends that will influence the way companies operate and people work," Bradshaw reports. "Looking towards 2013, the major trends will include an increasing adoption of cloud, virtual networks, unified communications and mobile working. In addition, companies will continue to globalise, and mergers and acquisitions will become even more commonplace."
This is bringing added complexity that is causing a major concern for CIOs and business managers as they grapple with how to effectively manage thousands of employees, hundreds of communications devices and many different systems across dozens of countries and time zones. The good news is that business seeking to remove much of the global complexity this brings are increasingly loosening the reins and "looking to service providers to help provide expertise and proactive managed services to ensure consistency of service for all users, regardless of location".
She also foresees significant consolidation of suppliers in many large organisations. With growing and merging businesses, the list of suppliers can increase, so Damovo expects managed service providers "to play an increasingly important role in helping organisations to manage and consolidate this effectively, without any loss of service".
Many businesses "will allow experienced managed service providers with matching local and international footprints to help them manage their growing physical and virtual infrastructures".
MANAGED PRINT SERVICES
Martin Deignan, director, sales & marketing, OKI Systems (Ireland)
Managed Print Services is becoming increasingly well known in the market as a solution for companies, including increasing numbers of SMEs, to save money and boost productivity, Deignan reports.
But most resellers are missing out, he argues, because they don’t have the required expertise to make MPS into a money making opportunity. "For many of them, the supply and service of printers and MFPs to customers is simply a chore and a cost which distracts from their core activities," Deignan claims.
Plugging this channel gap for expertise is a key element in OKI’s strategy and he suggests it is winning many new MPS contracts by working with partners and offering them a new source of recurring revenue and profit. OKI has made the investment in skills over the years "so the channel doesn’t have to do the same, offering comprehensive yet flexible MPS customer propositions to suit the reseller as well as the customer".
Some resellers prefer to be the first port of call for technical service for customers, while others choose to outsource everything to OKI including customer consultation, auditing, negotiation and ultimate roll out ("with an agreed and often attractive channel margin, of course"). But Deignan stresses that the user "always remains the reseller’s customer as regards invoicing and at the end of an MPS contract a new version is negotiated as before".
OKI’s nationwide network of salespeople and technicians work almost like extra staff for resellers, helping them add another string to the bow of their customer offerings. He says the channel partners that most commonly take advantage of OKI’s network are those that already offer general managed services, but haven’t had a print specialisation. "The good news is the true MPS marketplace is still at a relatively early stage in its development, especially where SMBs are concerned," Deignan reveals. But he warns that this "is likely to change quickly – a couple of years ago, a lot of time was spent evangelising the true MPS concept (multi-fleet, automated consumables management, full service etc), now customers get the general idea and it’s a question of ‘how’, not ‘why’."
Vincent Kenny, director, indirect sales, Ricoh Ireland
Kenny acknowledges that MPS has been around for some time and is a successful model for some print vendors, their partners and customers, but it’s mainly focused on cost savings as the number of print devices being used are reduced significantly and day-to-day maintenance costs also fall considerably. The first half of 2013, he argues, will see a significant progression from MPS to managed document services (MDS).
MPS is simply concerned with output but MDS is focused on the entire lifecycle of a business document. It addresses and improves the three fundamental parts of document management: input (the creation of information), throughput (how it moves around the organisation) and output (processing it in a way that adds value).
MDS provides a centralised and streamlined approach to managing all documents – print and electronic – and identifies cost and efficiency savings. It also provides additional benefits, including improved productivity from giving users rapid access to information resources, enabling them to access information more quickly and efficiently. It also reduces the burden on administration, saving time, money and vital resources.
As well as cost savings, one of the other key advantages for the IT department is it will be freed up to focusing on core competencies and add more value to the business.
"As Irish businesses look to find new ways of saving money and becoming more efficient and productive in 2013, we’re confident that MDS will really take a strong hold in the Irish market next year," Kenny claims. "We believe that vendors and resellers that already have tangible offerings in this area will benefit the most."
Jim Leyden, managing director, Bizquip?
Being able to offer clients a roadmap to increased cost savings and value-added services will be key in 2013, Leyden says. Feedback from customers reveals they are looking "for more innovative ways to either control or recoup costs associated with printing and copying on an ongoing basis".
There will be greater pressure on margins in 2013 but the race to the bottom on price will be offset by smarter use of technology if partners concentrate on added value rather than price alone. For example, introducing remote management software to manage client sites more effectively will reduce downtime, improve efficiencies and productivity.
In 2013, there will be more consolidation of clients’ offices where space is at a premium. This will necessitate smarter work flows in relation to paper and document management. Software solutions such as Equitrac and Nuance which incorporate "Follow Me" printing and tracking software "are going to be key differentiators for clients so they can drive down wastage and cost overruns".
Print audits will become even more important. Each print audit carried out by Bizquip is demonstrating potential cost savings of between 20% and 38%, Leyden reveals.
Investec Bank, a long standing client of Bizquip, achieved a 27 % reduction in running costs, with a total refresh of its copier/printer fleet and a reduction in equipment from 35 devices to 15 using a print management solution.
VIRTUALISATION
Paul Hourican, CEO, PFH Technology Group
With the release of Windows Server 2012 and "the many improvements with [Microsoft] Hyper-V", Hourican expects "the last few organisations that have not yet adopted server virtualisation to consider a move". Given that a SAN or shared storage is no longer a requirement, even the smallest of organisations will be able to move to a server virtualisation environment and reap the benefits.
He argues that with the playing field "pretty much on a par" between VMware vSphere and Microsoft Hyper-V in terms of functionality, there will be increased competition, especially for customers faced with OpEx renewal costs who may re-consider their decision over which hypervisor is best for them.
There is a slow adoption of virtual desktop infrastructure (VDI) in some organisations and Hourican predicts there could a stronger demand for Desktop as a Service offerings going forward.
Migration to private and public clouds is also likely to accelerate from slow growth to a higher pace of adoption. In turn, he believes, this will lead "to an increased opportunity in managed services as organisations realise they can consume IT as a service and get back to concentrating on their core business requirements".
Disaster recovery as a service is another area of potential for growth. There are many smaller organisations with a requirement for disaster recovery capabilities that cannot afford to have a dedicated standby site. Providing it as a service will allow organisations to take advantage of the cloud’s elasticity and only consume and pay for services as and when required.
Kieran McCabe, managing director, Triangle Computer Services
While Triangle continues to see virtualisation projects in the server and storage area, there are less of them although McCabe is quick to add there are "a few big ones around".
There is much more significant interest in virtualisation of the networking layer, he claims. VMware has product there, as does Cisco and he believes there will be "significant consultancy work around that".
There have been some very significant projects starting in the application layer, in terms of readying applications to use cloud infrastructure. "That’s the biggest growth area at the moment," McCabe reveals. Most traditional applications are not able to use a combination of public and private cloud, so there’s a need to rewrite or redevelop those applications.
"That’s where the focus is," he says. There’s also the ability to integrate cloud applications with internal applications. There’s a lot of effort being expended in trying to virtualise the application layer to maximise the benefit to the organisation.
End user compute is also gathering some momentum, McCabe reports. A lot of organisations can see the desktop they have today, but not many have a strategy for what it will look like in five years time. "We’re helping them to build a strategy to take them from their current state to their future state," he says. "That’s a journey and quite an investment."
And while there are many partners able to handle infrastructure virtualisation, the big question is: how do you get value out of it? Triangle has been doing work with the IVI Innovation Value Institute at the National University of Maynooth looking at the capability and maturity model for IT to manage their technologies. It is also involved in a number of cloud assessments at the moment which are aimed at helping organisations find out how ready they are to use a combination of public and private cloud. McCabe says most of them are not ready which presents a "fairly deep consultancy opportunity".
Steve Docherty, Cisco Ireland commercial & partner manager
With cost rationalisation trends across all industries, many companies are consolidating data assets in data centres, adopting virtualisation technologies, and moving to cloud architectures, Docherty says. Security is no longer a physical problem, but needs to be extended into the virtual world to provide effective security down to the application and virtual machine level.
Partners need to be able to offer a number of approaches that can be combined to provide physical security to protect the data centre infrastructure. "These same solutions are gradually being offered as virtual appliances to protect the virtual machines running on the physical servers," Docherty states, "from the outside world, but also from each other if appropriate."
As the march towards virtualisation continues, the security needs of channel partner customers evolve. "Irish partners can play a central part in helping customers through this complex transition," he adds.
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