Small and midsize businesses can leverage the same expertise as larger businesses while increasing their internal bandwidth by using managed services. By outsourcing IT, human resources, finance and customer support services to managed service providers, SMBs have an opportunity to refocus their internal efforts on strategic goals.
A 2022 JumpCloud report found that almost 88% of SMBs have hired managed service providers, mostly to handle IT and other operations.
“A managed service provider has a broad view of technologies and issues that are in the marketplace because they’re handling a lot more. They understand architecture and the opportunities to improve architecture more broadly than an organization or an individual who may have only seen their own environment,” says Ron Walker, U.S leader for managed services at KPMG.
“A SMB can lock itself into expensive fixes in the future if it doesn’t understand architecture from the very beginning. A managed service provider can provide that insight.”
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How to Reduce Small-Business Cyber Risk
SMBs can be vulnerable to cybersecurity attacks due to the increase in remote work and as phishing, ransomware and other attacks become more sophisticated. According to a 2024 report by Acronis, email attacks have increased by 293% this year over 2023 numbers, with many small businesses at higher risk because of their tendency to use free or outdated software.
A managed service provider can perform a range of tasks to help keep businesses safer, including penetration testing and other assessments, as well as network monitoring.
For SMBs in distinct markets, such as financial services, having a managed service provider that specializes in that area can provide more market perspective. A managed service provider can bring knowledge on issues such as how to handle ransomware attacks and when the best time is to make upgrades, explains Walker: “An in-house team wouldn’t have that broad perspective because they’re only dealing with issues in their own company.”
“Those are probably areas that smaller businesses don’t have access to, whereas the large companies have built-in automated systems using traditional automation and AI,” he says. “Scaling is absolutely one of the benefits for small businesses using a managed service provider. Scaling is already built into the service provider’s models.”
Walker also says that managed services are often the most cost-effective way to remain secure.
“Even if it’s at an extra cost, you’re using portions of a subject matter expert versus having to hire somebody or write another contract for a temporary consultant,” he says. “IT environments can be complex because they are largely built in the cloud right now, which changes dramatically every month. An SMB might have a hard time staying on top of those changes on its own.”
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Walker says that, similar to leasing versus buying, there are pros and cons to using managed service providers over hiring additional employees. A strong governance model, where the managed service provider is managed by a team or employee, is essential to getting the most out of services.
“Establish what your goals and objectives are and create a strong governance model. Then you are going to evaluate the provider on a regular basis based on an outcome-based delivery model,” Walker says. “This does require a level of trust. In my opinion, the more that you treat the service provider as a partner versus just a vendor, the better the results you’re going to get.”
