An economic downturn, larger business trends, gluts in supply and contractions in investment can affect any and all business from the smallest to the largest – sometimes adversely.
Nowhere is this more apparent than in Michigan -- home to America's largest automakers, two of which recently emerged from bankruptcy -- where even the smallest hiccup can reverberate in segments that seemingly have nothing to do with cars, such as IT services.
"Fifteen percent unemployment is nothing to take lightly," explains Mike Ritsema, owner and managing partner of Western Michigan-based tech solutions provider i3 Business Solutions. "It's a good thing for the auto bailout and the quick turnaround in Chrysler and bankruptcy proceedings that things aren't worse and also a good thing that Grand Rapids is in the western part of the state and better off than most areas."
Yet and still, cost -- especially in leaner times -- is always a factor, says Ritsema, who along with partner Kathy Labozzetta run the 18-year-old IT service, consultancy and support business as a tight ship.
In an uncertain economy it's important to create a dependable revenue stream than can act as an ace in the hole when a company is in the hole.
Ritsema believes managed services are the way for IT service concerns to weather economic storms.
"What happened really when we first went into managed services was that I was attending peer groups and was looking at how to shore up profits through managed services," said Ritsema. "Once we got on board with Zenith and they got on board with us and things sort of gel, we started to grow and I can say now that our managed services segment is the most profitable and predictable part of our business and you know what, I like profitable and predictable."
Posted by Jabulani Leffall on August 06, 20100 comments
Over the last decade, Charles Weaver, president of
MSP Alliance has been slowly but surely trying to win over traditional break-fix companies on the managed services model.
The pitch was and still is simple, roll off project-based implementation and reboot-crescent-wrench IT work and create an avenue for recurring revenue and repeat customers.
It's obvious that the pitch has worked. There are now thousands of managed service concerns, so much so that some have began to rank MSPs by revenue.
Now Weaver has predicted a new wave of managed services based on the growth of systems integration and telephony work for IT service companies.
"These are companies who were relatively well insulated during 2009 and were not as deeply affected by the bleed off of hardware/project revenues but can still read the tea leaves and know that a change must come," Weaver wrote in a recent blog post.
These new-wave companies, according to Weaver, are mainly VARs who want to begin to make their client projects more permanent and manage the network and systems projects that they set up.
Network administration, business continuity, and cloud computing architecture are some of the areas that the companies Weaver mentioned are looking to rapidly enter.
Posted by Jabulani Leffall on August 04, 20100 comments