The Rise of Cloud Managed Services

Just around the time we have wrapped our meads around “the cloud” and the degree to which it touches every part of our digital lives, the astute industry observer will have noticed the rise of cloud managed service providers. Why do they exist, and what do they do?

When a company or organisation lacks the expertise or headcount to manage its IT infrastructure, it often contracts this work out by hiring a managed services provider. In extremely basic terms, managed services means, we do the work for you. Company A contracts with Company B that Company B will do all the leg work of managing the information technology assets and infrastructure of Company A on behalf of Company A.

From Complex to Less Complex

IT asset and infrastructure management is complex, full stop. The cloud is meant to make that management easier; the cloud service provider handles a great deal of that complexity, low level detail and heavy lifting for you. Utilising the cloud makes the management of a company or organisation’s IT assets and infrastructure less complex, but it does not make it simple. This is where cloud managed services comes in. Companies working in the cloud or about to migrate their work to the cloud may opt to higher a managed services company take risk and complexity out of the entire process.

According to the Information Technology Infrastructure Library (ITIL), on one hand costs and risks are removed from a customer by a service, while on the other hand other costs and risk are imposed on the consumer by the service.

A Website in my Closet

To give a rather small-scale example, I can host my web site from a web server in my own home. In order to do this, I of course need the web server (computer), a static IP address, the web server software running on that computer (APACHE, IIS, nginx), the website itself in terms of HTML files and other files, etc. I bear all of those costs directly, and if anything fails or goes wrong, it is my responsibility to fix it before my website will work again. In contrast, I can higher a web hosting company for a nominal monthly fee, and they will take care of the server hardware, keeping the server software up to date (to lower the chance that my website gets hacked), and typically the files and code for the website itself are my responsibility. There is an additional scenario where I pay for a service like Wix, Webloo, or Shopify, for a bit more money than the web hosting service, but they additionally take care of the files for the website itself, and also provide a graphical user interface that makes it easier to customise the out-of-the-box website to my own liking. Each of these three stages that I have described for running a web site offers a different set of trade-offs between cost, risk, complexity and convenience.

A Business Too Big for One IT Lady

For a business or organisation to host not only its websites, but to also run all of its IT assets, the costs, risks and complexity described above will increase by orders of magnitude, in accordance with the size of the organisation. Bear in mind that for a large organisation, having desktops and laptops in the tens of thousands of machines each (basically one or two machines per staff member), servers on racks in the thousands, and even public facing websites in the dozens each: An IT landscape of this scale is not unusual.

A Simple Definition of Cloud

One of the most important trends in recent times is the cloud-based IT services. There are many ways to describe what “the cloud” is, but I usually say that instead of buying and running a computer (server) yourself, you utilise a server from a provider, and that provider acts like a utility. It is less a matter of renting the server, and more a matter of paying for the actual “service” that the server provides, paying only for what you use. And hopefully, if you use only what you need, costs are minimised. Risks are minimised because the service provider is an expert, and providing that service is the focus of their business. Things like security, maintenance, upgrades and upkeep are what they do best. So in the end, everything is meant to be more convenient for you when you pay only for the service, not worrying about the underlying infrastructure.

That is the ideal. The reality is that even though relying on a cloud provider is simpler than buying (or renting) your own IT assets and infrastructure, it is still by no means simple, and companies still find that the cost of a cloud managed services provider is worth the risk and complexity mitigated as a result of employing the managed services provider.

Enter the Managed Service Provider

One of the biggest risks in using the cloud arises from one of its greatest conveniences. It is very easy to provision cloud resources, and experience has shown that – like a kid in a candy shop – one might provision more resources that are actually needed, and unfortunately end up paying for them, only finding out at the end of the month once the bill comes due. Now, in practice cloud providers like AWS (Amazon Web Services), Google Cloud Services and Microsoft Azure provide tools to tell you exactly how much resources you are using, and therefore how much your bill is expected to be. The caveat is that the user has to avail of those costing tools, and if they are too busy or distracted to dig into the costing details, they are due for a financial surprise.

Wrapping Simplicity in Procedure

So perhaps the first benefit that the managed services provider delivers is to slow the roll on the provisioning of cloud resources, and building some procedure around the decisions made before resources such as virtual servers, databases, and networked storage devices are provisioned (ordered for immediate delivery). A business analyst role, a technical architect role, and an engineering role, etc. are all put through the paces before a half dozen buttons are clicked and a high-powered virtual machine is spun up at a cost of several thousand dollars per month.

As a company, a cloud managed service provider puts a human face on the faceless cloud. Each company has a different set of expertise, serving customers of a particular size in a particular industry or set of industries. Also geographic location is a very important consideration driving the selection of a cloud managed service provider, because geographic location dictates the legal and regulatory framework in which the business or organisation operates. This is especially when it comes to the collection, processing, and storage of user data.

Delegating Decisions to Organisations

Rather than reading the rules yourself, then deciding yourself exactly how to build your company's web application, hiring a cloud managed services provider places the burden of getting it right the first time on their shoulders. As well, hiring an expert very much frees you up to focus on your own core business, which most likely is not IT or cloud services. Lucky is the IT manager responsible for just one website: Most will need to manage dozens of high profile, both internal and external, as well as the datastores and interfaces that drive those assets.

Watch This Space

The number of cloud managed service providers is exploding, and to be fair I cannot say that the demand has been met, even as we face a global downturn. Most IT systems are not up to date, which is one reason why so many cyberattacks are successful. Most companies have not completed all the IT projects that they envision. Many sectors complain about the difficulty of attracting and retaining skilled staff. If you are an expert in cloud technologies, you are perhaps starting to think about the opportunity to start a cloud managed service firm. If you are a business decision maker, you are most likely already doing business with a cloud managed service provider. If not, then I bet that you are seriously thinking about it now.