Caution urged on launch of ‘managed services’ in asset finance

So-called managed services that offer an all-in-one combined package of equipment, financing, software and support need careful handling to ensure there are no expensive gaps in the process, according to the Alta Group consultancy.

Managed services are being developed in response to the changing marketplace, with end-users demanding the ease of dealing with fewer providers and paying for services only as they are needed, instead of owning assets or using traditional leasing.

Diane Croessmann, a director with the Alta Group, cautions that before launching or expanding managed services, companies should first evaluate whether critical steps are being overlooked that could open the door to long-term problems.

Nearly all business functions in equipment leasing and finance are affected by offering transactions that bundle equipment, software, services and financing into one solution.

This ranges from initial market analysis and risk management through to funding, delivery platforms and asset management.

Croessmann worked for 23 years in leasing for Xerox Corporation, where managed services originated with the cost-per-copy concept in the 1980s.

She argues that manufacturers, resellers, distributors and service providers planning to create agreements that bundle equipment, financing, software and services need a way to identify and avoid costly gaps in the process.

Companies that identify basic weaknesses in their readiness for managed services should consider a secondary phase of assessment that involves closing any gaps, such as in funding, and take a longer view of customer needs and the organizational or system changes required.

To support companies, a 10-minute questionnaire has been developed by Alta to guide businesses through a high-level assessment.

The questions will identify whether participants still need to address any issues in launching managed services.

The survey is designed for the equipment leasing industry, manufacturers and associated resellers, distributors and service providers.

Survey participants will receive a blind copy of summarized findings to enable comparison with other respondents.

To complete the questionnaire, visit http://thealtagroup.com/managed-services-assessment/