Is Managed Services Different from Outsourcing?


Since its emergence in the 1980s, outsourcing has turned into an umbrella term for any kind of service you can get from a third party provider. Managed services and outsourcing are often used interchangeably but there are actually a lot of key differences between those two models.

For one, managed IT services is a tool for managing your business operations while outsourced IT support is mainly a deployment tool.

Before making significant decisions about your business technology, it’s important to learn those differences. This blog will discuss what makes those two models unique and how they can help savvy business leaders like you in your day-to-day tasks.

What is Outsourcing?

Practicing outsourcing means an organization decides to hire a third party to deal with certain functions, rather than working on those tasks in-house. The third party works remotely and may be located in any part of the world.

When you outsource IT solutions, your business can enjoy lots of benefits. These include being able to scale quickly, reducing costs, using internal resources better, access to a bigger talent pool, and access to skills that aren’t available locally.

How do Managed IT Services Compare?

Managed service is an outsourcing solution used by many organizations. It also involves hiring a third-party partner for expertise or services.

However, a managed service provider offers a more comprehensive service in comparison to an outsourced vendor. These providers become your partners when it comes to achieving your goals in business and help you pinpoint any areas for improvement.


One of the main differences between outsourcing and managed services is the payment method. With managed services, you will immediately know the total cost of the given service. This makes managing your finances much easier. Outsourced services, on the other hand, are typically priced depending on the deal you make with the vendor.

Service Period

Most organizations rely on outsourcing for short-term help. Outsourcing vendors usually offer services for companies that cannot manage to do a specific function on their own. There are lots of vendors that operate on a per-project basis. Meanwhile, people get managed services as a permanent solution to a certain problem or need (i.e. hardware maintenance, network monitoring, etc.).

Level of Support

A managed services company will become an extension of your company. They will share your goals and keep working proactively to make your IT environment better while leveraging technology to propel your organization forward. They do this by coming up with an IT strategy that effectively aligns with your investment in your objectives.

Outsourcing also does this but it’s a service that you can easily drop when you no longer need it or if you are working with a strict budget.

Comparing managed services and outsourcing is not a debate on which one is better. There are companies that need managed IT solutions, while there are some that can get by without additional management help.

From the perspective of a consumer, the most important thing about these services is the ability to choose. There’s no one-size-fits-all deployment technology, but given the benefits from these two models, you can select one that matches your specific needs.

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