Cost savings and security are key drivers of MSP adoption

68% of SMB and mid-market business executives believe working with a managed service provider (MSP) helps them stay ahead of their competition, according to Infrascale.

MSP adoption

The research also suggests that the top reason that businesses opt to work with MSPs, chosen by 51% of respondents, is to save costs. The second most common reason survey respondents said they use an MSP is for increased security (46%).

96% of the respondents said that it is extremely or very important to have a predictable IT budget right now. Especially in today’s unpredictable environment, it’s no wonder that 51% view working with an MSP as more economical than hiring internal talent.

When it comes to budgeting, the three areas of information technology noted as incurring the most expense by SMB and mid-market company executives are: information security (60%), data storage (48%), and data analytics/business intelligence (45%). The IT areas incurring the least expense in budgets are: application licensing (24%), digital transformation (21%), and data center automation (21%).

“We conducted this survey to better understand the dynamics of how business executives perceive and select MSPs, as well as how MSPs can provide the greatest value to their SMBs and mid-market customers,” said Infrascale CEO Russell P. Reeder.

“Based on the results, we recommend that MSPs continue to lead with solutions focused on security, data storage, and data analytics. Our most successful MSP partners are enabling their businesses to be more secure and to always access and analyze their data. The lifeblood of any business is its data, so it makes sense that securing it, backing it up, and analyzing it is most important to businesses.”

Businesses seek a range of MSP services

Data protection (53%), data and analytics (48%), and cloud services (45%) are the top three services that business executives said that they use from their MSP, followed by specific data protection services: backup and recovery (43%) and cybersecurity (41%).

When it comes to the selection of MSPs by SMBs and mid-market companies, the list of services that MSPs must offer before they are even considered are almost identical, with data protection again topping the list (in this case at 52%) followed again by data and analytics (48%), and cloud services (45%).

However, 42% of respondents referenced technical support as the fourth most referenced must-have, followed by backup and recovery (41%).

Independent of the services offered, the six most important criteria for selecting an MSP, according to the survey, are:

• Quality of solutions (52%)
• Attention to security (46%)
• 24/7 support (45%)
• Cost (38%)
• Flexibility and special accommodations (37%)
• Saving time/offloading time-consuming tasks (37%)

Cloud-based infrastructure is widespread

98% of businesses surveyed are using a backup solution and 94% of businesses use disaster recovery. In most cases, MSPs help provide these solutions. Eighty percent of businesses said they use an MSP for disaster recovery and backup.

The move to the cloud is official, as 97% have implemented cloud-based infrastructure with a cloud service provider. Seventy-two percent of respondents use an MSP for cloud-based infrastructure.

Just 3% of business executives at SMBs and mid-market companies said that their organizations work with entities other than MSPs for assistance with cloud-based infrastructure. Meanwhile, 22% said they handle the responsibility for cloud-based infrastructure internally.

“SMBs and mid-market companies clearly have embraced MSPs to execute critical business capabilities such as cloud backup, disaster recovery, and cloud-based infrastructure,” Reeder noted.

“The adoption of cloud-based infrastructure signals that almost all companies are embracing digital transformation. The survey results show that nearly all respondents have moved some (64%) or all (31%) of their data to the cloud. The fact that 79% of the executives surveyed said that their companies have adopted software-as-a-service application technology such as Microsoft 365 or Salesforce is another example of ubiquitous cloud adoption.”

Businesses are willing to move to MSPs for the right solutions and service

Thirty-nine percent said they have only worked with their current or previous MSP for one to three years, while thirty-one percent of the survey group said they have worked with their MSP for more than three years.

55% of respondents said it took “a few weeks” or less to establish a good workflow with their MSP, including 19% who said it can take as little as a few days and 2% who said they were able to establish a good workflow immediately. Only 14% of respondents said it took three months or more to establish a good workflow with their MSP.

The survey results indicate that working with an MSP can substantially reduce the time required to implement new technology solutions. Seventeen percent of business executives said that without the assistance of an MSP, their company would require three months or more to implement a new technology solution.

Only 9% of respondents said three months or more would be required to implement a new technology solution when an MSP assists the company with that task.

“New cloud-based solutions are increasingly important to the competitiveness of today’s businesses, often yielding faster time to market, which in turn can boost revenue and market share,” observed Reeder.

“The expertise and timing advantage that an MSP can provide is particularly important, considering that 61% of business executives report being frustrated with the amount of time it takes to implement a new technology solution.”

Other key findings

• 34% of business executives reported having a negative experience with an MSP. The biggest reasons, tied at 43%, were high costs and quality issues.
• 35% have fired an MSP, with the number one reason (51%) being cost.
• 81% of business executives said they are either extremely or very likely to explore additional third-party assistance, beyond an MSP, to build their company’s security, data protection, and/or remote work capabilities.

“A key takeaway from the Infrascale survey is that MSPs provide significant value for SMBs, particularly around cost savings and faster implementation of solutions that arm businesses with a competitive advantage,” said Reeder.

“Business executives understand the importance of always having access to their data and keeping their systems up-and-running through cloud backup, disaster recovery, and cloud solutions to accelerate growth. As the research illustrates, businesses view their MSP as a highly capable provider of these critical functions. It’s not surprising that so many respondents see their MSP as an important ally in their competitive battle for growth.”