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You think your Managed Services business is doing well, but how can you be sure? Or maybe you just want to know how your business stacks up against your peers. Benchmarking is a great way to identify Managed Services trends and apply them to your own organization.

To begin the benchmarking process, data was collected from more than 50 Managed Services organizations. That information was compiled into TSIA’s Benchmark Study, the most comprehensive Managed Services benchmark in the industry.

Highlights from the study are presented in the SlideShare above, but let’s take a look at some of the key Managed Services trends that were identified. Find out how your organization compares.

Trend #1 – Remote Monitoring and Operation

54% of managed services revenue is derived from remote monitoring and operation of technology.

Organizations are offering many different managed services currently, but the remote monitoring and operation of technology appears to be the clear leader for revenue generation. Could your organization benefit from an added focus on these remote services?

Trend #2 – Managed XaaS

26% of managed services revenue is derived from Managed XaaS.

Managed XaaS also proved to be a strong revenue generator. 80% of all Managed Services revenue comes from either Managed XaaS or remote monitoring and operation of technology. All Managed Services organizations need to pay attention to this strong trend.

Trend #3 – Operating Income

14% is the median managed services operating income.

Most of the surveyed organizations are reporting that Managed Services operations are earning enough to cover associated operational costs. This is further proof of the sustainability of Managed Services. Is your Managed Services business able to sustain itself?

Trend #4 – Retention Rates

95% is the year-over-year revenue retention rate for Managed Services.

In other words, businesses are reporting that they are maintaining 95% of the previous year’s total Managed Services revenue. This is an impressive statistic that speaks to the durability of Managed Services. If your business is not experiencing comparable retention, there may be opportunities for improvement.

Trend #5 – Reporting Structure

31% of Managed Services executives report directly to either their organization’s CEO or COO.

Direct access to organizational leadership is important. It allows Managed Services to operate more efficiently. This structure may also indicate the organization places a high value on the Managed Services function.

The Value of Benchmarking

These statistics are more than just interesting facts. They give you insight into what your industry peers are doing and how they structure their Managed Services operations. Use this information to help you identify your organization’s strengths. More importantly, this information can be used to pinpoint the areas where your organization can improve to ensure future success.

Learn more about TSIA’s Managed Services Benchmark Study and the benefits of benchmarking by downloading this benchmark preview.

 
 
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George Humphrey

About Author George Humphrey

George Humphrey is the vice president and managing director of service and delivery research and advisory for TSIA. He also serves as TSIA’s vice president of managed services research. He is a networking and communications industry veteran with over 28 years of experience. Throughout his career, he has held several leadership positions in managed services, including global strategy, product line management, marketing, operations, and client management.

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