2021 State of Managed IT Services

As a leading managed service provider (MSP) in New England, we at Flagship took great interest in the recent 2021 Global MSP Benchmark Survey Report published by Kaseya Ltd.¹,one of our key partners for infrastructure management technology. The report confirmed our observations of both the primary concerns of MSP clients and the growing need for MSP services.

Managed Services Providers are IT services companies that take on the responsibility for designing, implementing and maintaining your IT systems. Effective MSP’s anticipate the need for a range of systems, processes and functions to improve your operation and reduce expenses. The MSPs surveyed by Kaseya were primarily general-purpose providers (63%), while others focused on security, network, data center or specialized IT operations.

Three Main Challenges for MSP Clients in 2021

MSPs expect that managing a remote workforce, IT security, and business continuity & disaster recovery (BC/DR) will be the biggest challenges for their clients in 2021. The following details these concerns for clients in the Americas (US, Puerto Rico and Canada).

Managing a Remote Workforce. In the Americas, 61% of MSP clientsseemanaging remote workers as their top challenge. The worldwide COVID-19 pandemic forced many workers at organizations to work from home in 2020. Any organization that was dependent on networked applications, internal data centers and shared storage had to consider the ramifications of a workforce that was no longer on premise.

How do I provide access to resources, maintain security and provide business continuity for users who are outside my firewall? For many of our clients this question required a shift to cloud provisioning of applications and core services, such as email, collaboration workspaces and system back-up. The 2021 MSP Benchmark said that revenue from cloud management services went up 54% last year, and that trend will continue.  

Cybersecurity. Fifty-eight percent of MSPs cited security as theirtop client concern. This is consistent with many reports of the huge uptick in cyberattacks in 2020, everything from emails with viruses and phishing scams to broader cyber-attacks.

At Flagship, we helped many clients weather and prevent cybersecurity threats. We developed our Flagship Security Framework built on industry best practices and the National Institute of Standards and Technology (NIST) Cyber Security Framework to work as a comprehensive security lifecycle of controls, processes and technologies to protect clients.  

Business Continuity & Disaster Recovery. BC/DR was noted as a top concern of 43% of respondents – a concern that was intensified by the need to support remote workers in 2020. Providing business continuity with on premise back-up and disaster recovery systems and on-premises staff is a challenge in and of itself. Remote workers, hybrid-cloud environments and increased security concerns only heightened the challenge.

Our client’s IT budgets didn’t go up in 2020 in anticipation of the tests that the COVID pandemic would throw at us. So, we worked with clients to devise highly dependable, yet economical BC/DR strategies, such as we noted in our recent City of Norwich success study.

High Demand Forecasted for MSPs

The MSP market is forecasted to grow 80% by 2026, from $152 billion in 2020 and to $274 billion, according to Mordor Intelligence’s Managed Services Market Forecasts (2021 - 2026). The client challenges above are driving much of that growth. For example, security services revenue grew 65% in the past 12 months, even in the face of a global economic recession.

From our perspective, this growth is being driven by the small and medium-sized businesses who realize that their IT staff doesn’t have the skills and resources to manage critical IT infrastructure in this new environment. Fifteen percent of the MSP Report respondents cited their concerns about shrinking IT budgets as a result of the pandemic. This is where you can rely on your MSP to help provide quality service within tight constraints.

Flagship Networks provides managed services through our IT Sentinel™ Managed Services offerings – both fully managed services to commercial businesses, schools and municipalities, as well as co-managed services to organizations with IT departments. Our objective is to tailor the best technology and services to meet your business IT challenges and fit your budget.

¹ Kaseya® is the leading provider of complete IT infrastructure management solutions for managed service providers (MSPs) and internal IT organizations.

Can managed IT services help your organization? Contact us for a free consultation.