Increasingly, VARs and solution providers alike are gravitating away from the reactive break-fix business model to a more proactive Managed Services model. In a break-fix scenario, channel players do not assume an active role in overseeing clients' technology once it has been implemented, and problems are addressed reactively as they arise. But in a Managed Services environment, resellers consistently and proactively handle end users' IT infrastructure. For example, under a typical managed network service umbrella, the VAR or service provider designs, implements, installs and maintains one, several or all network functions. Sources say the end result of such an arrangement -- and others like it -- is a "win-win" situation for all parties involved.

"There's absolutely no question that the market is at a tipping point in terms of readiness to make a switch to Managed Services, especially given the increasing complexity of the solutions that are being delivered today," asserts Bob LaGarde, founder and chairman of LaGarde, a Kansas City, Mo.-based provider of e-commerce services and solutions. The potential advantages of embracing the management services model are pushing its adoption. On the VAR side, opportunities for enhanced profitability top the list. Proactive management of clients' IT infrastructure enables resellers and solution providers to identify and address small glitches before they become major issues, as well as to remotely execute systems maintenance and upgrades. "This reduces providers' cost to deliver service, at least partially because they need not engage expensive human resources to go onsite to complete jobs," asserts Justin Crotty, vice president, services for distributor Ingram Micro North America.

Dan Shapero, senior vice president of Kaseya, corroborates Crotty's comments, adding that offering Managed Services also bolsters the bottom line because providers can collect flat fees for service upfront rather than wait for clients to incur charges, yielding them a recurring revenue stream. "What's more, flat fees for standard services are generally higher than hourly rates," notes Shapero, whose company offers IT automation software for solution providers and corporate IT organizations. Kaseya's solutions permit distributed IT infrastructures to be managed through a single integrated, Web-based platform.

The ability to present existing and potential clients with an enhanced value proposition -- and hence, sharpen the competitive edge -- attracts VARs and solution providers to this new model as well. So, too, does the option of offering a more comprehensive menu of IT expertise, without necessarily adding in-house staff, observes Tom Williams, director of the Managed Services program for the worldwide channel at Cisco. "These two factors make for a far 'stickier' provider-customer relationship, which is far more difficult to establish in the 'break-fix' world," Williams asserts.

Meanwhile, greater predictability and improved control of IT expenditures rank among major drivers for end users' growing interest in Managed Services. "Many companies, especially SMBs, like the idea of knowing what they will be spending on IT management and maintenance every month, and that they won't be hit with a big unexpected spike in costs," says Mike Ellison, manager of partner development at N-Able Technologies, an Ottawa, Canada-based supplier of remote monitoring and management technology and business support services for Managed Services providers.

The potential to see reduced systems downtime, and the option of deploying more complex applications without a major investment in human resources are currying clients' favor as well, notes Rob Bissett, N-Able's director of product management. "Companies aren't waiting hours for someone to come and fix their system, and they aren't paying the price of downtime in terms of losing customers because, for example, a POS system couldn't ring up transactions," Bissett says.

Recent months have wrought the development of many solutions and programs in the Managed Services space, which also includes Software-as-a-Service (SaaS). In an interesting twist, Courion Corp., a vendor of provisioning and access compliance solutions headquartered in Framingham, Mass., and Identropy, Inc., a New York City-based VAR that specializes in the delivery of identity management platforms, are partnering to provide a solution known as Identropy Managed Identity Services (iMIS) for Courion's Enterprise Provisioning Suite^TM. Designed for end users of all sizes, iMIS enables companies that host their own identity management systems to outsource the monitoring, management, reporting and remediation functions to Identropy. Kurt Johnson, Courion's vice president of development, notes that unlike some traditional managed identify services offerings, iMIS is a flexible, on-premise solution that acts as an extension of existing engineering resources. Customers maintain control over their own workflows and can shift day-to-day system management and monitoring to Identropy by leveraging the Web-based iMIS Portal Dashboard.

"With solutions that don't require a completely outsourced identity management infrastructure, we are addressing a major gap in the managed identity services space," purports Victor Barris, Identropy's CEO.

Similarly, N-Able has developed two solutions for Managed Services delivery: N Central 6, a subscription-based remote monitoring and management platform, and N Central On Demand, a demand-based monitoring and management platform. Both are suited for VARs and solution providers that concentrate on the SMB market.

Another player, Zenith Infotech of Warrendale, Pa., touts an SMB-oriented remote IT monitoring and management/disaster recovery application dubbed SAAZ.  Maurice Saluan, Zenith's vice president of channel management, says the cost-effective solution allows VARs to rack up 300 percent margins while providing a standby server on-site. Recovery time in the event of server downtime entails powering on a virtual machine, and VARs can also provide off-site storage as part of its service.

For its part, LaGarde delivers the eCommerce platform of e-commerce solutions, which it hosts in its own PCI-compliant environment via a SaaS model and which is suitable for implementation into SMB and large IT environments alike. The SaaS model allows maintenance packs, additional functionality and upgrades to be easily pushed to end users' sites for seamless operation, LaGarde reports.

Ingram Micro has also rolled out three new SaaS solutions as part of its Seismic Managed Services offering. These include Windows SharePoint 3.0, Microsoft Exchange Server 2007, Microsoft Exchange Server 2003 and Seismic Hosted Microsoft Dynamic CRM 4.0. All four solutions are delivered as part of the distributor's Seismic Virtual Services Warehouse and can be private-labeled by Seismic VAR partners.