Managed services vs Outsourcing
Whenever there is a talk on the difference between 'managed services' and 'outsourcing', most people would say it is just one concept with two names. Well, this is true to some level as if you in the main look at both these terms they depict the same idea, but if we go into the depth then we get to know that there is a fine line which distinguishes both the concepts with each other. Now before we see what this fine line is, let's first see when and why these terms came into being.
We know that business has always been an imperative part of human live since the prehistoric times. We also know that businesses revolve around different strategies which keep on evolving and changing, making them improved, profitable and easier ones. Outsourcing came out as a business strategy somewhere in the 1970s, but it was not called a business strategy officially until 1989.
If we break the word 'outsourcing' into two words 'out' and 'source',then we pretty much get the idea that it means taking the source from somewhere outside. Before the late 19th century, every company was a huge integrated one, which managed everything on its own, without the help of some external source and this was practiced on a global scale. However, after the Industrial Revolution, many business companies came up with a new idea which was to take help from outside sources so that they can increase their malleability and power in the modern technological world of business. So, the basic necessity to outsource services was to make your company work at better quality without spending a lot of money performing the same service on its own.
Now that we have some kind of idea about what outsourcing , let's see what managed services are. As the name indicates these are services managed by people from somewhere else or other than your company and organization. It we look at the dictionary meaning of 'managed services' then it is to get your management services done by some outer source and not from within the particular company you are owning. You might be wondering what is the difference between these two if both have actually the same purpose. For that, we will have to give a closer look at both these terms and specifically how they differ in their action or work.
First and far most difference to be kept in mind while differentiating these two is the time period or for how long these services are taken by companies. Outsourcing is said to be a short-term help so there isn't a specific company or person from which you outsource time to time, rather it is more like a n option B when your company or the people inside don't end up managing the work within a certain time limit. On the contrary, the latter one is a long-term help which we can say is 'permanent'. So, here your company always takes help from some outside source whether it is about some hardware service or work related to printing. Managed Service therefore tends to be a more easier and a better kind of outsourcing because you get to know about whatever the cost is, and therefore can manage your company's finance in a much better way. Outsourcing is a sudden help where you have no idea about the payment and hence sometimes you might run out of budget or fail managing it properly. In managed services usually, the fee is paid monthly and there is an exact amount you already are aware of. We just said that Managed Services is a better mode of taking help from an outsource so let's take an example for better understanding.
You have a brand as a company and you feel you should hire some other company to help you deliver your stuff for online shopping. In the first case if you go with outsourcing, these would be the circumstances.
1) You would face problems looking for some reliable delivery service because not every delivery service is available in the eleventh hour.
2) Stuff will not be delivered on time, which means there is a chance of losing customers.
3) You have no idea about an exact amount it will cost you.
4) It will cost you more.
5) Will require more time and energy.
6) All these would eventually ruin your company's reputation in the market.
On the other hand, if you have hired a particular company or person, you would get rid of all these problems. Another very eminent difference between these two is that outsourcing is more concerned
with the management. Now by management we mean the equipment, tools and processes. We often hear the term Managed Service Provider when we talk about managed services in context of IT. MSP can be called a company that can controls your company's infrastructure in an efficient and much better way. Some of the most used tools required by Managed Service Providers across the globe are Professional Service Automation Software, Remote Access Protocol, Remote Monitoring and Management (RMM), Patch Manager, Backup Plan, Malware Protection, Network Security and many more. But, if we look at Outsourcing then it has more to do with deployment. Now what exactly does deployment mean here? If a company feels that they can get their work done more efficiently and in lower costs, they will look for ways of making a great profit by outsourcing their business or work there.
You will notice that no doubt both 'managed services' and 'outsource' have the same job of getting any kind of work done from another company or person and that 'source' is the key word in both cases. However, we only choose one when it comes to business and work. The important thing here to remember is that outsource does not let a third-party control everything that is within your company, rather you just give a part or portion of your job when in need, unlike Managed Services.
It is hard to say which one of these two is more effective as both have their merits and disadvantages, but it has been observed in the past couple of decades that the businesses have shifted from Outsourcing to Managed Services.
References:
• http://money.howstuffworks.com/outsourcing1.htm
• http://smallbizbonfire.com/profiles/blogs/the-difference-between-outsourcing-and-managed-services
• http://www.wisegeek.org/what-is-outsourcing.htm
• https://imptrax.com/what-we-do/managed-security-services