How Businesses Should Evaluate Potential IT Service Providers


When choosing an IT service provider, you have many things to consider – support capabilities, service-level agreements, pricing models, and other variables. The capabilities to consider will vary depending on your business, however, there are some capabilities that you should look for in any service provider. And with the explosion in the number of cloud service providers, it’s becoming more challenging to find the right service provider to support your business.

The market for managed services is expected to grow to $194.34 billion by 2019 as more companies look to the cloud to host their IT applications. According to the Everest Group, most companies have already “picked the relatively low hanging fruit” and are now looking for managed service providers that offer a broader set of services and deeper IT expertise. Companies are shopping for IT partners that can meet their immediate computing needs, and who can advise them and support future needs.

So what, specifically, should you be looking for in a managed services partner? Here are some questions to consider:

1. Do they know my business?

The requirements of every industry and every business are different, and you want to be sure you choose a managed services provider who uinderstands your business needs. For example, if you are in a highly regulated industry, such as healthcare or finance, can your service provider support regulatory compliance and assist in the event of an audit? If you are an e-commerce company can they ensure safe and secure transactions? Inventory your specific needs and review them with your managed services candidates before making a decision.

2. Is bigger better?

Do you want to go with the biggest hosting provider around? Bigger doesn’t always mean better. Large-scale hosting companies can offer more servicecs but also can be impersonal and sometimes customer care gets lost in the process. On the other extreme, a company that is too small won’t be able to meet your needs. It’s best to choose a provider that is scaled for your business; a managed services company that is big enough to expand with your needs but small enough to provider personalized service.

3. Do they have a dedicated service team?

When considering the type of IT partner you are seeking, size and service go hand in hand. You want to be sure that your IT service company can deliver the personalized service you need, when you need it.

4. Do they have system redundancy?

Service reliability is extremely important when working with a managed hosting service. Ask about system failover and redundancy. For example, do they have a contingency plan and backup power in case of a power outage (a common occurrence in Connecticut in the winter). What about data backups and systems failover? You want to be sure that a systems failure on the hosting side doesn’t impact your business. You also want to be sure you hosting provider can handle disaster recovery.

5. How comprehensive are their SLAs?

Service level agreements (SLAs) are your contractual assurance that the company can meet your requirements. Beyond technology, SLAs guarantee such things as response times and guaranteed uptime. SLAs should be your guarantee of reliable service, so be sure to review them carefully and regularly and make adjustments as needed. Some of the bigger hosting companies can hide behind their SLAs, delaying response because the contract says they have three hours to resolve a problem, so be sure to review SLA terms carefully.

6. Do they provide proactive monitoring and protection?

Data security and protecting sensitive intellectual property from malicious attack is a growing problem. Plus, if there is a problem, such as a distributed denial of service (DDOS) attack, you want your hosting company to come to you with a solution before you even realize there is a problem. Be sure your managed services partner provides proactive systems monitoring.

7. What is their cost structure?

Hosted services are going to be less expensive than maintaining your own dedicated data center, but how much less expensive? Managed service providers use various pricing models but a fixed pricing model is usually a better option, especially for services. Variable or per incident pricing is difficult to budget. Be sure that any pricing structure encompasses systems maintenance, management, and contracts with equipment providers.

8. Can the company grow with my needs?

Since you can’t always predict your IT requirements as your company grows, be sure to find a service partner with the breadth of experience and capability to grow with your needs. This goes back to using the “three bears” approach to choosing a service provider that is the right size – not too big, not too small, but just right.

9. Do they have references?

The only way you can assess the quality of a hosted service provider is through their track record. Any prospective IT partner should gladly provide customer references. If they can’t or they don’t have references relevant to your industry or similar to your company, consider carefully before signing a contract.

These are just some of the questions you should ask of potential IT service providers. There will be many more questions and concerns that will be unique to your operation, but if you start with the basics you will be in a better position to work through the specific requirements you need to support your business.

16 Questions

About The Author

President of NSI, Tom has been helping small and medium businesses succeed in Connecticut for over 25 years.