Inside story on the growth of outsourcing

07/01/16 | Latest News

Large numbers of ICT resellers are turning to third party support companies for reasons that are all too evident. Here, we explore why outsourcing is the focus of growing attention among resellers wanting an ingrained partnership that is also an extension of their business. The big customer support handover has begun and the chemistry between…

SHAUN LYNN 2Large numbers of ICT resellers are turning to third party support companies for reasons that are all too evident. Here, we explore why outsourcing is the focus of growing attention among resellers wanting an ingrained partnership that is also an extension of their business.

The big customer support handover has begun and the chemistry between outsource providers and their partners is more potent than ever, based on the evolving comms market and its knock-on effects on many ICT resellers. In line with these trends Comms-care has taken steps over the past 12 months to respond to big changes in the technology industry, which saw its channel partners require access to a broader range of professional and managed services to sell on to their customers.

“Developments in the technology industry have created a shortage of skills, especially in the area of higher end professional services, so we have made acquisitions such as Platform Consultancy and increased our efforts to attract apprentices who can be trained in key competencies and add value to our clients,” said Rob Darby, Sales Director.

Comms-care’s reseller partners want the firm to become more ingrained in their businesses, so rather than just ask Comms-care for a quote they want the company to be involved in the whole end-to-end sales process. This new dynamic is reflected in the split between its services. Maintenance services account for 50 per cent, managed services 10 per cent, and professional services 40 per cent, with the bias in favour of managed and professional services happening over the last year.

“We are not just about break/fix maintenance – a business that we are still proud of – but can offer a much broader set of professional and managed services to our clients’ customers as part of their own propositions,” added Darby. “Our ambitions are still very much focused on growth, whether that’s organically or through further acquisitions, concentrating on delivering our channel-only business strategy.

“But the skills shortage is the biggest challenge facing any company operating within the technology industry. As skills become more rare, they become more expensive and employers have to fight to attract them. Unless we find ways to nurture new people through apprenticeships or other channels, this problem will only get worse.”

The speed of change in the market was also underlined by Paul Benson, Managing Director at National Telecoms Installations (NTI), who during the past 12 months has witnessed a big increase in requests from dealers for installations of hosted systems across a number of different platforms. Just 12 months ago these installs amounted to one per month, NTI now installs two or three sites per week for its dealer customer base.

“While hosted is still not right for every end user client, the format is certainly a trend we are adapting to serve,” stated Benson. “The increase in hosted telephony installations has also driven demand for our cat5e and cat6 cabling services as dealers look to remove older PBXs on traditional CW1308 cabling and replace them with hosted telephony on a proven certified LAN.”

Benson has not, to date, seen a drop in demand for NTI’s PBX installation and maintenance services. On the contrary, the move of existing systems from ISDN and analogue to SIP is on the increase, and sites with larger more complex needs often don’t suit the hosted model, he pointed out. “We find the most successful resellers have expanded their portfolio to ensure they are selling a solution handpicked from a toolbox of products which includes traditional PBX, hosted, PSTN and SIP technologies, rather than focusing on one or the other,” added Benson.

Agilitas’ main area of expertise is in Inventory-as-a-Service. “By extending our wholesale Inventory-as-a-Service portfolio to provide inventory support, training, repairs, hardware sales and technical support, we’ve developed our offering and grown turnover by 30 per cent in the last year as a result,” said Shaun Lynn (pictured above), CEO of Agilitas.
The growth of the cloud and mobile workforce has changed the demand for spares, focusing on delivery in data centres with less on-premise hardware. “We’ve seen dependence on IT rise fast,” added Lynn. “Having the right parts available when required is becoming ever more important to businesses. At the same time, we see the wider industry facing a number of challenges. The continual squeeze on margins is making organisations look at new ways to maximise revenue, and post and pre-sales services are now an integral part of all profitable product sales and processes.”

The company has grown its partner base by approximately 18 per cent and found Inventory-as-a-Service to be in most demand. “However, this service is being increasingly adopted in conjunction with technical support or training,” added Lynn. “This enhances the service offering and introduces elements of differentiation to partners. We’re also expecting to see a significant increase in cloud-based data storage and the criticality of uptime in onsite and offsite infrastructure.”

Agilitas has developed two key opportunities for growth – identifying new partners and extending its capability into additional product sets and markets. “We constantly need to adapt in order to be ahead of the curve, and continuously improve service levels to meet expectations while investing in skills and development to maintain current product experience,” said Lynn.

Investing in the future has also been a priority for Maintel which created a new partner services team following its merger with Proximity. It supplies two main types of service – Professional Services (including engineering, installation and consultancy) and Managed Services (including maintenance and support). Over the last year Maintel has increased its number of partners by around 10 per cent.

The key requirements in demand are taking on the support of legacy systems, specialist skills complementing its channels’ own resources, and providing a single point for consolidating all unified communications, contact centre, workforce optimisation and data networking needs. “Tactically, the requests have been for our skills, expertise, geographic coverage, availability and breadth of portfolio,” said Chris Bain, Director of Partner Services, Maintel.

“There will be a natural progression for systems integrators and outsourcers to want to address a bigger market. For telcos, they will need to focus their energy and effort on current systems, not legacy devices, so will need partners to do that. Channels need a partner who will allow them to keep what they have now and move to the future. Resellers need to show value beyond the traditional sales model. They will need to assist the customer at the beginning and end of investment cycles.

“Partner services enable resellers, outsourcers, systems integrators and telcos to do this without major investment in personnel. Our partners look for a company to not only provide the services they don’t have, but also to be an integral part of their customer engagement and growth plans.”

Juniper Bridge is an outsource provider to the industry supplying customer support software, 24×7 support services and device logistics solutions to more than 80 telecoms and IT businesses. The firm has also witnessed a growing requirement to create flexible support models, and for the delivery of enhanced customer support technologies where cost of ownership is too high for a service provider.

Resellers wanting to get to grips with new technology approach Juniper Bridge for discussions that are becoming increasingly collaborative and partnership focused. “Clients approach us for a diverse set of reasons,” said Simon Johnson, Commercial Director. “Scalability and flexibility are of course key considerations, but they are also looking for tangible value adds for their own propositions. As a result, we spend a lot of time developing our systems to deliver solutions that, ironically for us at least, seek to reduce the customer support cycle. The trick is about creating a continuously improving relationship with a client and to openly look at process and system integration.”

Historically, Juniper Bridge’s revenues have mostly been driven by outsourced technical support contracts which are still growing, but resellers’ support requirements are changing as they move to converged technologies. “There is more demand for cloud-based products (particularly hosted PBX and Wi-Fi), IT desktop (Microsoft 365) and support for network monitoring systems (for example, proactive fibre circuit and leased line monitoring),” noted Johnson.

“Revenue has doubled in the last 12 months following growth in sales of our technical support software which has been complemented by a number of large CPE logistics wins. We have invested in R&D and in our CloudKeeper technology. The software provides a full technical back office solution that unifies with multiple technologies, carriers and technical support models, including our own. Our CloudKeeper portal has developed beyond recognition over the last two years and we are constantly bringing on new enhancements.”

Link Connect is a network and IT hosting company based in Hampshire. It uses outsourcing to bring flexibility to its customer support model. Operations Manager James Smith said: “We use an outsourced provider for our front of house which gives us a true lights-on first line support capability with readily available agents to answer our calls. They follow our processes, ensuring the customer receives a consistent high standard of service.”

This enables Link Connect’s tier 2 technical team to focus on serious incidents and put customers’ change requests, security matters and managed services before line issues and other time consuming tasks that ‘just need doing’. “Offering legacy ISP services with our managed services means we have volume calls and faults that require carrier management,” added Smith. “Our outsource partner takes this pain away, looking after our products like leased lines, VoIP, Wi-Fi, DSL and email.

“This is not without some risk to the customer support model, and shows why outsourcing must be viewed as a partnership. Choosing a partner with the right support tools and flexibility to their approach is key.”

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