With customers looking to sweat their assets and the need to avoid costly downtime becoming ever more important, youd expect maintenance and technology services to be a booming business. However, its not as booming as it might be and support services vendors face an increasingly savvy customer base that wants to vary the amount it pays to maintain different business processes. Vendors are having to become more inventive in developing their support services portfolios, widening their customer base, and adding a vertical as well as a horizontal element to their support offerings.
Demand for basic support services is increasing, but competition and savvier customers are keeping revenues flat
The recession has hit IT equipment sales hard in Europe and North America. Many equipment purchases have been cancelled or put on hold and customers are looking to sweat existing assets to see them through the recession. As PCs and servers see their life extended well beyond warranty periods, demand for basic support services such as post-warranty hardware and software break/fix services is increasing as customers take out an insurance to keep their systems up and running.
That would be good news for support services providers were it not for the fact that:
- theres more competition as every vendor offers heterogeneous systems support
- customers increasingly match service levels to system criticality office systems dont need 24×7 support but online transactional systems probably do, and the age of the one-size-fits-all SLA is long gone
- resellers and business partners are desperate to increase their support services businesses to make up for faltering equipment sales
- the cost of maintaining a support field force is increasing
- warranty upgrades purchased with new systems are in decline as the IT equipment market declines.
- Vendors are becoming more inventive with their support services portfolios
Weve already seen vendors move to offer more proactive services in a bid to increase the higher-value services in their portfolios. Vendors offer enhanced technical advice, guaranteed service levels and a more proactive approach to system availability. Indeed, whether its retail point-of-sale (POS) terminals or systems in the data centre, vendors are increasingly offering a managed services approach to support. These proactive services go beyond the individual boxes to provide integrated hardware and system-level software support, a focus on performance and availability, and a more customised approach to support.
The key for the vendor is to be able to offer managed support services across the whole of the customers IT infrastructure: PCs, servers, routers, storage, system software and even middleware. The benefit for the customer is that, as its infrastructure becomes ever more complex and the dependencies between resources ever greater, the single managed support services contract offers simplicity: one vendor to deal with; one contract; lower cost. The benefit for the vendor comes with increased deal sizes and the ability to upsell additional managed services to offset declining revenues from commodity technical support.
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