Managed services: an antidote to risk aversion?

The pace of digital transformation can be daunting because tech is not a one-time cost. It’s an ongoing investment, and many executives consider it a risk.

In fact, according to the KPMG Global Tech Report, 80 percent of tech professionals say that senior leadership’s risk aversion means their organization is slower than competitors to embrace new technology. From automation to cybersecurity, many implementations are stuck at strategic vision, failing to advance due to a lack of leadership buy-in.

One exception is everything as a service (XaaS). With this technology, thanks to the agility and cost reduction enabled by cloud computing, companies are more likely to have received executive buy-in and begun implementation.

Keeping up with the pace of change

Building on their appetite for XaaS, many senior leaders are also looking to managed services to mitigate some of the risk associated with tech investment decisions.

In this operating model, companies can access advanced technology, embedded domain expertise, and leading practices, all in an as-a-service package with predictable costs and a multi-year contract.

Consider these findings from the most recent KPMG and HFS Research Managed Services Outlook:

• 72 percent of executives say managed services exceed expectations on their goal to access new technology.
• In the next two years, 76 percent anticipate that managed services will significantly impact technology innovation, which could otherwise be challenging to build or evolve internally. For example, this innovation might include generative AI for improved cyber threat detection or chatbots that can diagnose IT issues and write new code.
• As managed services help companies keep up with rapid change, 67 percent of executives say C-level leaders or the board decides.

With the relentless speed of digital evolution, most companies can’t afford to fall behind. Inaction due to risk aversion can be costly in the form of lost market share, stakeholder trust, and overall competitiveness.

Instead, progressive companies are designing operating models that can harness emerging tech, continue to evolve, and quickly pivot as priorities change. Managed services are a way to do just that while limiting disruption and risk.

Learn more about KPMG Managed Services.