Over the last 20 years there have been only a small handful of credible companies offering NOC or help desk solutions to MSPs. Yet, there is a lot of discussion around NOC solutions for MSPs and it is important for MSPs to understand why. There are distinct times throughout a MSPs life when outsourcing NOC services to another MSP may be both plausible but also wise. Let’s look at when those times may be and also when MSPs should NOT outsource something as mission critical as a NOC.
History of Outsourced NOC
Speaking only of NOC solutions to other MSPs and not to end-users, this business model, sometimes called “Master MSP” has its origins in the vendor community. That’s right. Vendors were among the first to organize and deliver outsourced NOC services to MSPs. Most often these were “outsourced” arrangements themselves (the vendor didn’t actually own the NOC, they just contracted with another MSP to sell those services to other MSPs). The reason should come as no surprise; vendors wanted to encourage adoption of managed services. For smaller MSPs who didn’t have the resources or need to build a 24/7 staffed NOC, outsourcing made a lot of sense. Plus, it helped the vendor sell their goods.
So, now that we know where the outsourced NOC model comes from, we can now examine scenarios where MSPs would want to utilize them. We’ll also look at some of the downsides as well.
When NOC Outsourcing is Smart
When should you look at handing over your NOC strategy to another company?
- New MSPs – When a new company or division offers a managed service, the creation of a NOC or help desk can be an expensive endeavor. If your new MSP offering has legitimate need for a NOC and you can’t cost justify its creation, outsourcing might be a good solution.
- High Growth – There are real periods of high growth within a company where the draw on resources can be challenging. I have even seen MSPs with existing NOC capabilities outsource to another MSP just to achieve true 24/7 coverage.
- Non-Core Offerings – It is also entirely possible that as a MSP you have a set of service offerings which do not require a NOC. Yet, having a NOC as a “nice to have” feature seems appealing. In this scenario, leveraging an outsourced NOC can be a great decision.
When NOC Outsourcing Is Dangerous
Please note, all the previous scenarios where outsourcing your NOC is mentioned, how this outsourcing is accomplished and whether it is successful is all in the details. There are a number of situations where outsourcing something as vital to a MSP’s business model can not only be challenging, but also damaging to the MSP if done improperly.
- No Defined Procedures – If you outsource your NOC without having any service delivery procedures in place, you cannot expect this relationship to magically solve anything. In fact, outsourcing a NOC with no pre-defined policies or procedures in place can often do great manage to a MSP’s reputation with its customers. You want your NOC partner to fit into your business model, not the other way around.
- Regulated or Sensitive Markets – If you service banking, financial services, health care, legal, or other customers who have regulatory or unique transparency requirements, outsourcing a NOC must be done carefully. I’m not saying it cannot be done, but any situation where a MSP is itself outsourcing to a 3rd party will come under increasing scrutiny moving forward. If this is a practice you use, then the same transparency and risk mitigation policies your customers employ must also be used by the MSP on the outsourced party.
- Unknown NOC – I have seen a number of situations where an outsourced NOC solution is actually not delivered by the company but another organization. So, follow me here. MSP decides to use 3rd party NOC. The 3rd party NOC does not deliver the solution, but instead white labels the NOC services from a separate provider. Yeah, this is actually happening! Be careful and ask questions. If you don’t get answers you are comfortable with then maybe you should reconsider your options.
There are plenty of good reasons why you should have a NOC. There are even some good reasons for outsourcing your NOC. But, if you decide to outsource, be smart about it and do it intelligently. If you decide to do it yourself, that’s fine as well. There are plenty of MSPs who have developed their own NOC and it works just fine.