Highly distributed organizations run their IT systems on a managed services provider (MSP) model — supporting numbers of offices dispersed over a geographic area.
Mark Scott, president of The Utility Company, says the best model for this combines advanced network monitoring with a franchising system, such as that used by Dunkin’ Donuts.
His company is an MSP serving a growing population of small companies — “five-person PR firms, 30-person law offices” — across North America from its Ottawa, Canada, base.
“We try to anticipate problems. We fix about 90 percent of them proactively, and as much as possible remotely, over the network. But when we diagnose a hardware problem, we send out the franchisee for that area.”
The franchisees are either small, independent IT professional support companies or affiliates such as office equipment dealers and telecommunications resellers, often focused on specific vertical markets.
“We have carved the continent up into 2,000 exclusive markets, so if I were pitching you a franchise I could describe the territory street by street,” Scott says.
“(Our Connected Office service) lets technology professionals who want to go out on their own offer their clients a complete service, hardware and software.”
Based on this model, The Utility Company provides a fixed-fee total support service, including help desk, antivirus, patch management and remediation, to offices of fewer than about 100 desks at about US$80 per seat per month under its “Connected Office” umbrella.
This may sound expensive, but Scott argues that it can save clients money by eliminating the huge waste of IT investment that typifies many office environments.
Force-fed the latest and greatest
“The whole IT value chain is designed to force-feed you to buy equipment. Vista or some other ‘latest and greatest’ technology comes out, and you start hearing about how you have to upgrade. Then you need new hardware to run the technology, or vice versa, you need to buy the new software to get the most from your new hardware.”
The result, he says, is that organizations constantly buy technology they don’t need.
“We have a Utility Meter Reading process that takes a snapshot of what you spend per user per month on technology. We find the average company spends $360, 50 percent more than it spends on rent and occupancy. Then they use 15 percent of it.”
That is partly the result of overbuying and partly the result of underuse. For instance, if users are not trained in how to get the most from complex technologies such as Office, they are unlikely to get full value from their employer’s investment.
“The big hardware vendors constantly publish reports showing that the gear they sell is used in the low teens (percentage of utilization capacity),” he says. As part of Connected Office, The Utility Company helps its users match technology investments to their actual business needs.
Supporting large numbers of small offices across a continent efficiently requires advanced tools. “The technologies we use have to be transparent,” he says. “A law firm in Wichita doesn’t care what we use for network or desktop management; they just want their IT to work.”
Choosing the right technology platform was one of Scott’s major concerns in designing his business. “I have to plan for three years out, when we have 10,000 end-users out there. We have stayed away from the stuff in the managed services space, because if we make a mistake in our choice, the switching cost will kill us two years from now.”
Immature products and false positives
Network management, he says, is full of immature products that give false positive readings, creating a great deal of extra work. “At the other end of the spectrum is BMC, Tivoli, OpenView that requires an army to run. So cost/benefit is a problem there.”
In the middle, Scott found the WhatsUp Gold network monitoring tool from Ipswitch Inc.. Scott had previous experience with Ipswitch. “They always had stability, customizability and other features.
About a year ago they started building managed service provisioning features into their products. Once we had heard that Ipswitch had built multitenancy into their product, giving a central view across numerous customers dispersed across a geographic region, it made our decision easy.”
As a result, he signed a partnership with Ipswitch. As part of that now six-month-old agreement, Scott’s developers are customizing Ipswitch’s WhatsUp software for the MSP market and sending their add-ons back to Ipswitch, which then can add those it likes to the product package.
“Having been using them for the last six months,” Scott says, “I think they have dollar-for-value the best technology out there for network management for a geographically dispersed user environment. They haven’t marketed very much into the MSP area yet, but they could be a market leader.”