Application Managed Services. What is it and what value does it provide?
Application Managed Services is the outsourcing of maintenance and support for a single application, or a suite of applications used by your business. Most often, this is for large enterprise-wide applications such as Customer Resource Management (CRM) or Enterprise Resource Planning (ERP) software. It is a subset of the much broader category of Managed Services which includes outsourcing a variety of services to support your organization’s goals and objectives.
Focusing on Application Managed Services (AMS), some organizations choose to use a generalist support provider and have few relationships with vendors to cover most of their applications. In other cases, organizations will work with vendors who provide AMS for a selected application. There are more relationships to manage but the knowledge is usually more targeted and applicable to each application. There are pros and cons for either structure that we will not discuss in this article.
This article is written from the perspective of choosing a vendor who is focused on providing services for a single application, in this case, an ERP system which is treated as the central hub for an organization and a primary source of data used throughout the organization.
This article discusses the differences and benefits of using an AMS vendor to support an organization’s use of an enterprise application. These components are routed in the fact that you originally implemented a system to modernize and streamline key business processes, standardize data, and increase operating efficiency. There are three main components to an AMS offering:
Much like a homeowner has routine maintenance to do, an enterprise application has the same. Routine tasks such as cleaning, taking out the trash, and changing the furnace filter all have parallels to the ERP. Records are created and no longer used, parts of data are cleaned up, but other parts remain available, and mismatches in data lead to integrity issues. Users come and go from the system and their access changes. And it is important to periodically ensure that the systems are running and functioning in good order.
A good maintenance package for an ERP system will have elements of these in place. It will cover basic system maintenance, health checks and monitoring, security maintenance, data integrity checks, and master data management. A great maintenance package will automate most or all these tasks and only highlight the issues or exceptions to key staff or the service provider to take action.
Building on the homeowner analogy, there are jobs to be done around any house to keep it functioning smoothly. The time intervals can range from daily to quarterly to as needed and can include things like meal preparation or delivery services, window cleaning services, and repair services. Similarly in an ERP system, basic master data entry, environment refreshes, and code deployment are items that can be scheduled. On the other hand, bugs, incidents, or break-fix items happen when you need them the least – like your water heater breaking in the middle of the night.
An AMS support package has a high degree of variability in what it can provide. Routine data entry and incident troubleshooting have very different skill sets. Support also covers the range of module expertise and technical expertise needed to run an ERP system. Additionally, troubleshooting and fixing an issue is different from root cause analysis. With complex systems such as ERP, it is hard to avoid issues. But understanding why it was an issue and working to resolve the issue, so it doesn’t happen again is an important part of providing support.
Who doesn’t like a good home renovation project? A modern kitchen refresh, a new deck to enjoy the summer, or a proactive furnace replacement are important projects that extend the life of your house. The parallels for ERP systems are version upgrades, new module adoption, or business process rationalization. Modern SaaS systems dictate the upgrade cycle but legacy, on-premises ones leave the upgrades up to the customers. In either case, it is up to you to decide which functionality to use to support the organization’s goals.
Projects can be driven by internal IT pressures such as the need to keep current for infrastructure licensing or to patch security vulnerabilities. They can also be driven by business needs such as new lines of business or increased functionality usage in a core system. A good AMS team will also uncover areas within the E1 implementation that could be done more efficiently or could remove customization with built-in functionality or minor configuration changes.
Application Managed Services at ERP-One
At ERP-One we have designed our AMS offering to cover each of the three components. Starting with Maintenance we have packages for Technical, Security, and Application layers. Support for each area (Technical, Security, Applications by Module) is then added through attractive hourly rates that you consume as needed. Finally, as our team gains knowledge of your system and how your business uses the ERP to achieve its goals our lead resources and Client Success Managers work with you to build a project roadmap that ensures minimal business disruption and captures more business value from the ERP investment.