Top five trends in managed services

CIOs are looking for more than just provisioning from application providers, with the focus on the managed service model to deliver business results from business applications

Tags: Bentley Systems (www.bentley.com/)Cloud computingManaged services
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Top five trends in managed services Robins: CIOs are looking to software providers to manage their applications for them.
By  Brian Robins Published  May 4, 2014

During the last 18 months we have seen a steady increase in the number of requests that we have received from architecture, engineering and construction companies to manage their software applications for them. The scope includes project design collaboration and work-sharing applications through to construction work packaging and asset management. What is motivating them is the increasing complexity of the information technology environment and the realisation that while IT is an essential driver of efficiency and productivity, it is in fact not their core competence.

At the same time, the megatrends of consumer technology – social, mobile, cloud, and big data — are being felt in the business world and especially enterprise IT. The consequences of this consumerisation of IT are that expectations of usability and accessibility have been raised to levels that are beyond the reach of many firms and that IT organisations are stretched too thin.

Hence CIOs are increasingly looking to their software providers to not only sell and install software but also to manage it for them. More than that, CIOs are asking how to get the most value out of the software, what are the best practices, and what are the benchmarks for their peer group. They want to pay for results not time and materials. In certain situations, architecture, engineering and construction companies are going one step further and asking for help with document control, data quality management, and project information management and reporting. It all adds up to a strong trend towards managed services, namely the outsourcing of IT services management and project administration workflows and business processes.

So where is this all heading? What are the top five things you should look out for in the world of managed services over the next 18-24 months? Here is my short list:

It’s a hybrid world, after all

Many organisations are already running some of their corporate IT applications in the cloud including accounting applications and customer relationship management. Many CIOs and IT managers profess to have a ‘cloud first’ or ‘mobile first’ strategy. However when it comes to graphics-intensive modeling applications and multi-layered BIM models, it is not clear that running them and managing them in the cloud is always feasible. Also given the huge investments in desktop applications, not every firm has the luxury of throwing them all out and starting over with a clean sheet.

Most IT organisations will continue to provision a mix of on-premise and cloud software for the foreseeable future. The cloud is not a silver bullet and most IT environments will continue to be hybrid. Where you can gain an edge is by finding your optimal combination of on-premise and cloud. This may involve caching servers and delta file transfers, where only changes are transmitted from local servers to be stored in the cloud rather than entire models.

One size does not fit all

One of the reasons that software-as-a-service and applications running in the cloud are so cost effective is that they are multi-tenant. This means that many companies are sharing a single instance of the software and are storing their data in the same database. Scalability is achieved because everybody is running the same application, normally the same version of the application, and the business processes and workflows are all standardised.

But increasingly, organisations are opting for a private cloud, where they have greater assurance that their data is being properly safeguarded and where the CIO can pinpoint a physical server in a rack in a data centre and assure the organisation’s project executives and program directors that their data is in safe hands. Moreover, some entities require specific configurations and want to preserve older software versions driven by published standards and dependencies. In these situations automatic software updates sometimes pose more of a headache than manual, labor-intensive machine-by-machine upgrades. More than optimising and streamlining standardised workflows and business processes, companies are looking for solutions that are really tailored for integrated project delivery.

From cost reduction to organisational agility

The strategic objective and business justification for many IT implementations have up to now centered on cost reduction. Shaving percentages off the total installed cost or construction value has been the name of the game. An impressive catalogue of case studies and project references proves the point. A look back over five years of submissions to Bentley’s ‘Be Inspired’ Awards turns up example after example of process improvements and efficiency gains: 15% reduction in design time; time savings of 10% in project execution; ability to manage change requests resulting in time savings of more than 80%; ability to prepare and issue engineering sets 50% quicker; 75% reduction in printing, scanning and mailing costs; plotting time reduced by 40%; and so on.

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