By Darren Taylor, Head of Service Design
A year ago, you may have been wondering how AI will change IT managed services. Now, you know that it will. The key questions are how quickly, how deeply and how that changes relationships with managed services partners (MSPs)?
Managed Services have focused on stability
Traditionally, managed services clients wanted stability and reliability. Clients valued predictable operations, repeatable processes, standardisation, reduced risk of change, and fixed support models. MSPs therefore focused on minimising disruption, maintaining uptime, process discipline, operational consistency, ticket resolution metrics, and SLAs.
All of this meant a measured rate of change driven by periodic platform migrations, annual refresh cycles and quarterly reviews.
This contrasts sharply with AI-era expectations.
AI is accelerating operational change
You know from your own experience that AI is developing quickly – and much faster than enterprise IT operational models.
Within Microsoft’s AI ecosystem we’re seeing continuous evolution:
- Copilot capabilities changing monthly
- new agents and automations emerging
- developing governance controls
- rapid feature rollout across Microsoft 365.
We also know that many employees are no longer waiting for IT to introduce AI – see our blog Shadow AI: Why the Rapid Increase and What IT Should Do Next.
Whereas historically IT drove new technology introductions, now we’re seeing employees independently discovering AI tools and creating automations.
This changes the client-MSP dynamic.
In the AI era static support models will become unsustainable.
AI is changing expectations of IT support
We’re becoming more accustomed to Copilot-style interactions and natural language requests, along with AI-assisted productivity. As a result, traditional support experiences can begin to feel slow or outdated.
Regardless of whether you handle first-line support in-house or through an MSP, your users are expecting:
- greater immediacy
- conversational interfaces
- intelligent assistance
- self-service and
- proactive support.
And not just ticket queues.
This adds to the pressure for MSPs to improve support delivery with modernised workflows, knowledge management, and automation.
AI is changing the tempo of IT operations, and not just the tooling.
Boundaries between support, automation, and consultancy are blurring
Traditionally, support, projects, consultancy, and automation have been distinct disciplines, and in many organisations still are. But as the AI era develops organisations will need faster operational evolution.
Support will need to become more consultative, broadening the role of your MSP to include:
- automating operational tasks
- continuously optimising workflows
- recommending governance improvements
- building AI-assisted processes
- helping govern employee-built agents.
This is a fundamental shift from simply managing infrastructure, to managing continuous operational change.
And it calls into question the very essence of traditional MSP relationships.
Static service models will be increasingly divergent from need
We’re already seeing that AI changes environments too quickly for traditional approaches to remain fully effective. Approaches that are characterised by rigid operational models, fixed, often inflexible, scopes, and static service catalogues.
AI capabilities are evolving much faster than contract cycles. The rapid changes we’re seeing with data governance, Purview, AI policies and compliance underline this.
New operational requirements and opportunities are emerging all the time and MSPs will need to be much more adaptive. At the moment we might consider the following:
- AI-assisted ticket triage
- workflow automation
- intelligent reporting
- predictive remediation.
But in a few months, this may have evolved so MSPs need to be capable of being highly adaptive.
To be of value your MSP needs to be your ‘Operational Evolution Partner’
AI is changing the way organisations and people work. To be of value to their clients MSPs need to change the way they work.
Instead of maintaining static environments, MSPs need to be working with their clients to enable operational evolution.
This requires MSPs to help:
- evaluating changes
- operationalising changes
- governing them and
- safely pacing change.
It requires MSPs to have the knowledge to enable clients to achieve and maintain AI-enabled operational maturity.
Governance is central
Where governance considerations were once peripheral, with AI they become central.
Faster operational change creates greater demands on governance – and with AI the emphasis needs to be on safe operation rather than restriction.
There are big questions around the governance of:
- employee-built agents
- AI-assisted workflows
- data exposure and
- automation governance.
Additionally, your Microsoft environment is evolving unusually quickly. We’re seeing repeated changes to Copilot, Fabric, Purview, Defender, Sentinel, Entra, agentic capabilities, Power Platform many with governance implications.
MSP’s will need to have the operational experience of managing these changes.
Questions to ask an MSP
Ask an MSP about how they use and manage AI. Consider:
- Operational adaptability – How do you evolve operations?
- AI governance – How do you govern AI use within your organisation?
- Automation strategy – Which operational processes are already AI-assisted?
- Human oversight – Where does human validation remain mandatory?
- Visibility – How do you monitor shadow AI or unofficial automation?
- Commercial evolution – How does AI alter your service model?
- Microsoft readiness – How do you assess and operationalise new Microsoft AI capabilities?
A different commercial model
Historically, ticket volume has been the basis of managed services commercial relationships. Value has been directly linked to human effort.
But AI can automate repetitive operational work. For clients there is clear value in faster, more efficient incident resolution. But if AI reduces effort, should service costs reduce too? If operational AI transformation requires investment, who should fund that?
Whereas traditional IT projects have been a very clear transformation from here to there. In the AI era, customers expect MSP relationships to support continuous operational evolution of platforms and services. This requires a more flexible commercial model, perhaps based on shared rewards.
The human element becomes more, not less, important!
AI promises significant productivity gains, so it’s perhaps counterintuitive to suggest that the human element will become more important.
But as AI accelerates, governance, prioritisation, business judgement, trust, pacing, and risk management will become more important. So, while the future may bring less human involvement it will demand more strategic human involvement.
The most valuable MSPs will be those that continuously help their clients adapt safely, rather than just operating efficiently.
At Cloud Direct we talk of ‘human-led, AI-powered, outcomes that matter.’
Take the next step
If your MSP isn’t built for continuous change, it’s time to challenge it!
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