top three reasons every ceo needs managed services
TRANSCRIPT
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Top Three Reasons Every CEO Needs Managed Services
www.tsia.com
What are the facts?
Traditional tech companies are shrinking
Service revenues are declining
CEOs are worried
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The data doesn’t lie.
2015 = $372B 2015 = $411B
Tech Service RevTech Product Rev
2013 = $433B 2013 = $414B
2014 = $412B 2014 = $430B
Source: TSIA Technology & Service 50 Index 3
www.tsia.com 4
Which CEO are you?
“We don’t have an MS
business, and are not
thinking about it.”
“We’re thinking
about MS but haven’t pulled the trigger.”
“We have an MS
business, but it’s not producing
yet.”
“We’re doing it, and it’s
growing like crazy. It’s profitable.
We’re excited!”
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Creates stickiness & reduces
risk
CEOs must pay attention to, and establish a Managed Services business.
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1
3
Why?
High growth &
profitability
2
First step to
the cloud
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Managed Services is a high growth business that is also highly profitable.
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1Reason
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In 2015, 66% of tech companies saw flat or declining services revenues.
However, MS revenues have jumped from 6% of all services revenue to 24% since 2013. This is a huge opportunity for tech companies that don’t currently have a MS business.
Source: TSIA Managed Services Benchmark 7
www.tsia.com 8Source: TSIA Managed Services Benchmark
MS is growing faster than any other service line.
MS Benchmark Service Revenue
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And… MS is the second most profitable!
9Source: TSIA Managed Services Benchmark
Service Line Financial Performance
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Winning Play #1
If you haven’t already, hire a Head of Managed Services and have them report into your C-suite.
Fact: 33% of MS execs now report to C-level.
Source: TSIA Managed Services Benchmark
www.tsia.com
Managed Services is a stepping stone to the cloud, and allows companies to make money as they move in that direction.
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2Reason
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The cloud is disrupting the world…
TraditionalTech Company
SaaSCompany
CHAOS
… and it’s affecting everybody!
Managed vs. Unmanaged Continuum
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Traditional tech companies are moving to SaaS.
TraditionalTech Company
SaaSCompany
CHAOS
Customer On-PremiseUnmanaged
Customer Prem (CapEx)Managed
Customer PremManaged (OpEx)
Managed vs. Unmanaged Continuum
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SaaS companies are moving to hybrid.
TraditionalTech Company
SaaSCompany
CHAOS
Customer On-PremiseUnmanaged
Customer Prem (CapEx)Managed
Customer PremManaged (OpEx)
CloudUnmanaged
CloudManaged
Hybrid-CloudManaged
Managed vs. Unmanaged Continuum
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Despite disruption, Managed XaaS is at the epicenter of revenue generation.
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22%
33%21%
24%
MS Revenue by Type
Onsite Operation Tech Managed XaaS Remote Monitoring and NotificationRemote Operation of Tech
33% of MS revenues are Managed XaaS!
RemoteManaged Services
Source: TSIA Managed Services Benchmark
www.tsia.com 17
Before diving head-first into the cloud, use Managed XaaS offers to make money while you figure out how your business fits into the subscription economy.
Winning Play #2
Fact: 33% of MS revenues are now Managed XaaS.
Source: TSIA Managed Services Benchmark
www.tsia.com
Managed Services creates stickiness with your customers and reduces risk while you’re repositioning your business for long-term growth.
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3Reason
www.tsia.com 19
Sticky offers keep the money train rolling.
Your customers already believe in your business, so you can make major pivots without losing them in the transition.
Sticky offers help keep customers on your platform while you retool your business for the cloud.
How?
And…
www.tsia.com 20
While you’re figuring out how to manage the industry disruptions, leverage Managed Services to continue to make money.
Winning Play #3
Fact: 95% of MS revenues and contracts are renewed.
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Make your first winning play today.
www.tsia.com
Talk to us about Managed Services.
http://hubs.ly/H02j-630
George HumphreyVP, Research and Advisory, Managed [email protected]