Managed Services - The Leasing Economy

IT Purchase Compared To A Managed Service

The needs of consumers, the technology and the way they use it to communicate with others are moving fast. This creates pressure within the IT industry to adapt, sparking a transformation in the way that products and services are marketed. Increasingly we are seeing IT providers move from a model where companies buy hardware and software outright, to one where equipment is rented or leased as part of a managed service. The IT Leasing Economy is here and it can greatly benefit all organisations.

With companies looking to be flexible in their IT delivery in a fast changing industry, we are likely to see leasing, subscription and managed services become the norm for a broad range of IT products and services. Whether this is across the range of IT products from Microsoft, and their latest Office packages, or to infrastructure as a service (IaaS) products offered by providers including Oracle.

This phenomenon is evident throughout the entire economy with consumers able to lease such diverse products as razors  and lightbulbs; where companies are using cloud services such as IP telephony (VoIP) to reduce capital outlay and spread their operating costs as evenly as possible across each financial year.

The Advantages of Managed Services and A Leasing Economy

The growth in the “leasing economy” is being driven through the number of benefits it manifests for both the suppliers and their customers.

Companies using this model for their products get a reliable recurring revenue from the client rather than a singular purchases at infrequent intervals. This improves cash flow and increases loyalty as customer contact is more consistent and they are less likely to look elsewhere unless unhappy with the service provided.

Managed IT services make sense for businesses as they lower monthly capital expenditure, guarantee a level of ongoing support and help businesses future-proof themselves by getting regular upgrades to their solution. It is typical, under managed service deals, that the supplying company will provide up to date technology, and related software, to ensure that the service provided continues to work effectively.

Managed services are also more tailored to be flexible to the capacity needs of the organisation, meaning that the contract can expand or contract without prohibitive capital cost in IT services to the business.

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