It's hard to find a solution provider or industry expert who doesn't believe managed services are the wave of the future. That's because they answer business needs of both end customers and technology service providers.

Small and midsize businesses, especially those that are IT-dependent, benefit from outsourcing IT to managed services providers (MSPs). By paying MSPs a monthly fee for proactive services that ensure information availability, customers are freed to focus on their core competencies instead of IT. This benefits MSPs as well. The recurring contract revenue helps the balance sheet, while remote monitoring and management (RMM) software and other proactive tools allow technical staff to do more with less. Perhaps best of all, the RMM tools generate metrics that allow MSPs to pinpoint needed project work, further raising profits while solidifying customer relationships.

With so many pluses, you'd expect every VAR or integrator to be enmeshed in managed services, and many are. But transitioning from reactive services can be disruptive. Acquiring tools and building infrastructure to support proactive services can cost a bundle. Business processes and staff duties must be changed. And startup MSPs must develop a new value proposition and sales story that the market will accept.

"Getting started with managed services isn't easy, but resources and capabilities are available to help ease the transition," says Justin Crotty, vice president of services at Ingram Micro North America, and the driving force behind the Seismic managed services portfolio that Ingram Micro began rolling out in late 2006.

Seismic Success
Today, Seismic consists of the Seismic Virtual Services Warehouse, a growing line of integrated tools and discrete managed services; and the Seismic Success Support Portal, an online knowledge base of best practices, tutorials, training and peer-group sharing. Designed to help solution providers enter and succeed in managed services with the least pain and expense, Seismic is by far the industry's most complete managed services offering. (For details, see "Ingram Micro Seismic at a Glance" below.)

"Seismic's mission is to help our partners succeed with managed services by alleviating barriers to entry, advocating best practices and offering partners access to an increasing array of affordable and proven MSP services and support resources," says Crotty. "By using Seismic services instead of investing in smaller, independent infrastructures on their own, solution providers can establish a profitable offering that renders a predictable revenue stream and will ultimately work to evolve their business models and expand their services portfolios."

How successful is Seismic in achieving these goals? As we'll see, the early returns are excellent. MSPs who've tried it are enthusiastic about the concept and agree that it's accelerating their journey toward managed-ser vices success.

USIT Ramps Up
United States Information Technologies (USIT) is a solution provider for the healthcare industry and, thanks to Seismic, a budding MSP. Founded in 2005, the company provides IT support to branch offices of large medical centers, and also to smaller clinics lacking IT expertise. USIT is entering managed services to enhance its appeal to those smaller clinics, says Todd Brown, president and co-founder. "We want to position ourselves as an outsourced IT department for companies that don't have their own, and for branch offices of large, multilocation firms."

To jump-start that business, USIT joined Seismic in March 2007 and has taken on the Seismic Hosted Managed Workplace, Managed NOC, Professional Services Automation (PSA) Software, and E-mail and Web Defense -- nearly the complete offering. Brown has developed a good-better-best managed services menu and currently has several customers in beta mode to gain process experience and tune the value proposition.

Brown's reasons for choosing Seismic? The integrated web-based tools, low startup costs and confidence in Ingram Micro as a trusted partner.

"We wanted to provide support using realtime information gleaned from integrated, webbased systems," he says. "Seismic seemed like the fastest, easiest way." Having been impressed with Autotask PSA software as a member of the Ingram Micro Services Network (IMSN), Brown felt the move to Seismic was more "cutting-edge than bleeding-edge," he quips.

Of special appeal was the webbased integration of Seismic's hosted tools, as well as the pay-as-you-go pricing model. Hosted services are priced by the number of users, which is ultimately much lower than the staffing and infrastructure costs of self-hosting. "We made a significant investment to get started, but not nearly what it would cost to build out and staff a NOC," Brown says. "I've worked with companies that had an NOC, and you need to have engineers manning it and people out selling it. Seismic adds to our breadth and completes our service offering. But if we don't aggressively market it right away, we don't have to worry about the livelihood of the engineers or the monthly costs."

This benefit is what Paul Dippell, CEO of solution-provider advisory firm Service Leadership, calls "fractional labor." It solves a key problem for startup MSPs: how to staff a NOC or help desk before you have enough customers to justify full-time workers. "When you get into managed services, all of a sudden you have to have someone monitoring alerts and answering the phone 24/7, or at least 8/5," Dippell says. "That kind of overhead can sink you right there. Seismic's ability to provide help-desk and NOC coverage is a huge benefit because you can fractionally use their head count to cover whatever alerts or calls come in."

Seismic's hosting offers another advantage that Brown stresses to customers -- world-class infrastructure backed by Ingram Micro. "The story is, 'We have the healthcare expertise you need, and we're making on-site and remote IT support available through integrated and interactive web-based systems, so you have real-time access to what we're looking at. And our services are backed by Ingram Micro's Fortune 100-class solutions that usually aren't available to individual clinics.' Few if any competitors can match that."

Brown believes this message will resonate with prospects -- even those not ready to take the plunge. "All the big companies will offer some version of managed services soon," he says. "Even if we don't sell it to an existing customer for six months, we're spreading the word, it's on our web site, we're perfecting our processes. Eventually customers will become convinced it's the only way to go. If we've been knocking on the door, I know we'll get a serious look."

Computer ER: Seismic Makes It Work
Computer ER is a full-service solution provider serving SMB accounts. In its nine years in business, the company had always tried to be proactive -- visiting customers regularly, checking server logs, and testing power supplies and storage restores -- but in reality, says VP and founder Craig Flint, "we were reactive more than anything, and it was running us ragged."

That changed two years ago when Flint got into managed services, a business just now hitting its stride. "For the past two years we've been changing everyone's attitude around the office and working with our contract customers to show them the benefits of proactive service," he says. "We're convincing them that what we were doing before, for a certain fee per month, is nothing compared to what we can do now."

At Computer ER, a key to better customer service is the RMM software, which allows technicians to handle more calls remotely and assign the right staffer when an on-site visit is needed. RMM alerts and reports are also paying off in their ability to predict problems -- an opening to propose profitable project work.

These capabilities are provided by Seismic's Hosted Managed Workplace, powered by Level Platforms, and the Hosted NOC. Letting Ingram Micro handle these functions, Flint says, is "one of the be st decisions I've made this year."

Two years ago, Flint evaluated RMM software from N-able but found it too expensive. Instead, he chose Level Platforms and was satisfied with the functionality and subscription pricing. As the MSP business grew, however, the expense and overhead of self-hosting became heavy. "We had added a few new customers with 250 desktops and servers apiece, which started to take a toll on our RMM server, so we were looking to upgrade. When we heard about Seismic hosting, it was a no-brainer."

Seismic's managed hosting of Level Platforms costs a bit more compared to self-hosted licenses, but it's much less overall when you consider the cost of a new server, a redundant internet connection and 24/7/365 management. "It's as scalable as we need," Flint says, "and the reliability is better than we could do on our own. We've been on it about six months and are very satisfied."

This same reasoning -- that it pays to buy rather than build -- led Flint to the Seismic Hosted NOC when it became available. It reduces the alerts his technicians must respond to, freeing them for more strategic work. The staffers managing the NOC are friendly, U.S.-based and easy to work with -- "they don't sound like complete nerds," Flint reports -- and they handle alerts 24 hours a day.

Besides operational efficiency, Flint finds the Managed NOC to be a powerful selling point with customers. "We tell people it's like a person monitoring your computer 24 hours a day, seven days a week, and for what we're charging, you couldn't even hire a five-yearold to do that," he says. "Usually they agree. Even if we're monitoring only one server, they'll get the reports and start seeing that maybe their server isn't running as well as they thought. So it leads to other business."

Flint is also considering the Seismic Help Desk as a way to service customers who call occasionally when they have a problem. "With the Help Desk, we could tell them, 'You can call us, and we'll arrange for a service call in three to five days. Or we'll give you a toll-free number and the Help Desk staff will solve most of your problems. If they can't, call us and we'll come out.' That would relieve our person answering the phone and broaden our reach."

Whether it's converting existing customers or winning new ones, Flint is convinced that leveraging Seismic tools and services is good for business. "We just picked up a new customer yesterday who was working with another MSP," he says. "The fan on the server wasn't working, causing the temperature to rise. We caught it within minutes, so they dumped them and signed on with us."

Such wins and greater overall efficiency have energized Computer ER's bottom line. As of July 2007, Flint reports a 552 percent year-to-year increase in net profits from managed services, in large part due the Seismic program.

Databranch: A Track to Run On
Seismic isn't just for startup MSPs. Case in point: Databranch, a solution provider for more than 20 years and an MSP for the last four, has recently become a Seismic partner.

Long before Ingram Micro introduced Seismic, Databranch CEO David Prince chose N-able software for remote monitoring and management, but found it expensive and difficult to set up for customers. When Seismic offered Level Platforms Managed Workplace software in 2006, Prince made the switch. He's been a loyal Seismic partner ever since.

"We have just 15 employees, and Nable required more care and feeding than a company our size could afford," Prince says. "With pay-as-you-go pricing and easier customer implementation, Level Platforms is a better financial model for us."

Since Databranch hosts Managed Workplace at its offices, Prince could have bought the software directly from Level Platforms. But he chose Ingram Micro for two reasons: Seismic's portfolio of outsourced services offers the flexibility, scalability and choice to meet Prince's future needs; and the Seismic Success Support Portal, with its rich knowledge base of best practices and tutorials, will help him develop the business processes so vital to managed services success.

"Seismic is like a track for us to run on," says Prince. "We and other MSP organizations are challenged to develop new business processes, such as what's included in a contract, how to price services, and how to acquire and transition customers. The resources that Seismic brings to bear on these issues are very helpful."

Indeed, consultant Dippell considers the Success Support Portal, available free to Seismic partners, a major leverage point for new and even established MSPs. "One of the biggest cost hurdles MSPs face is creating the business processes and intellectual property for effective services delivery and customer acquisition," Dippell says. "Seismic is doing an excellent job of delivering that knowledge through the portal. Seismic partners receive hundreds of thousands of dollars worth of knowledge that they'd otherwise have to develop and pay for themselves."

Prince also likes the option to add Seismic services such as the Help Desk and E-mail and Web Defense, even though he provides the latter internally. "Right now, e-mail management is very profitable for us, but I'm going to continue to monitor whether our ability to sell outstrips our ability to deliver. If that happens, I have no hesitation about outsourcing services to Ingram Micro."

The reason is, even as VARs change their back-office methods for delivering services, their essential value-add remains unchanged. For Prince and Databranch, it's "the ability to get in front of our clients and talk about what's important from a business standpoint."

Crotty of Ingram Micro agrees. "At the end of the day, the value comes to the customer from the solution provider, not from Seismic," he says. "VARs' expertise and ability to serve their customers will always be what differentiates them.