As consumers, we’re all very well accustomed with subscription models. From music to television, food to wine, we make regular payments and receive regular goods or services. It’s a fixed cost; it’s a fixed scope.
So it’s little wonder that in the business environment there’s an increasing demand for similar business models.
In the latest Eden Talks podcast, Paul Wright technology and vendor manager at Arco, highlights how the PPE equipment, workplace safety and hygiene products supplier has moved to an SAP managed service – and, while initially, it was a cost-driven decision, Arco has realised a number of other benefits that come with having a managed service.
“Initially, we wanted to control costs, so that fixed-price offering made commercial sense,” he says. “There are potential cost savings there in our maintenance bill, too. Previously, our support was limited to a finite pot of days, and that led to an unpredictable spend – and we didn’t like that as a business.”
Creating a consolidated landscape
While the fixed financial aspect provided the initial attraction, the opportunity to consolidate Arco’s range of suppliers was also appealing for Wright, who’d been promoted from technical project manager into a role responsible for building, simplifying and optimising relationships with technology partners.
“We had a spread of application support partners – a number of SAP technologies with different partners [including Edenhouse] that had grown organically over the years – and it made sense to consolidate them with Edenhouse, who were already playing a critical support role for us.”
Consolidating support partners enables a more centralised and streamlined approach – however, the transition process is something that can seem daunting.
“Having all of those different functional aspects managed in one place, and at one time, is great for us. Each one of those services has a potential overhead in terms of service reviews, so it’s really easy to have that one-stop-shop if you like.”
Arco needed to transition services from other parties into Edenhouse, which was carried out as a complimentary service.
“The transition process was really straightforward,” says Wright. “Arco was the first customer to move across to this model, and we had input into the contract, and we made sure it was a good fit for both parties.
“I’m sure, as that model’s matured, the transition is even smoother for new customers.”
Additional benefits of a managed service agreement
As well as the obvious cost benefits and the ease of operating that comes with consolidation, Arco has seen a reduction in administration and associated costs that are required to manage the technology side of the business.
“It’s a lot easier to do business,” says Wright. “It’s freed a lot of our staff up.
“From both sides, there’s no longer this commercial requirement for authorisation – that’s all been removed, so the ease is one of the main advantages.”
The nature of a managed service agreement revolves around proactivity and supporting the client’s SAP environment – Edenhouse monitors and manages the service. When something needs attention or action, it happens.
“That proactivity has increased, and we don’t need that approval step for those small enhancements,” says Wright.
“We’ve seen a big increase in critical security patches released by SAP recently. Being on the Eden Run service means Edenhouse is aware of this; if it impacts us as a customer, they inform us immediately.
“In some cases, they’ll investigate and implement the fix with minimal involvement from our team.
“The bottleneck [of approvals] has been removed.”
Future focus – expanding operations
Looking to the future, there’s significant opportunity to grow the partnership even further, with regular meetings used to update one another on what’s going on in the respective companies, and technological advancements in the marketplace.
“We’ve invested heavily in our digital transformation to become a digital-first business, and we’re really keen to investigate opportunities to work with some of the kinship partners that Edenhouse has in place, particularly around e-commerce, cybersecurity and GRC (governance, risk and compliance).”
For ARCO, the managed service model is something that continues to evolve, grow and deliver increasing value to its operation.