Have you ever been to an ice cream store with only two flavours: Vanilla and Chocolate?
Unlikely.
It’s because ice cream shop owners understand that their market demands choice.
Customers have different preferences and want to build out their own flavour combinations. The managed services industry hasn’t been quite so switched on when it comes to these preferences in the past. With the introduction of Public Clouds, where things are moving at an incredible pace, this becomes problematic.
It’s time to offer more cloud flavours
Every organisation is on their own individual cloud journey and as they progress through that journey, their requirements and what they value from a provider changes. With this as background, a static, monolithic service offering (vanilla or chocolate) doesn’t provide ongoing value to customers.
This value conundrum is what drove us to pioneer Service Blocks at Rackspace.
I saw customers’ needs changing as they matured in their cloud usage. I heard recurring feedback that customers using the traditional, monolithic service models were experiencing “service wastage” – they were paying for things they didn’t need. I felt frustration when customers left, not because of a low-quality service, but because the services offering was no longer delivering the value it once was.
Within Rackspace, we consider the Australian market a cloudy market. We have built a strong specialisation in the cloud space and with this problem statement clear in our minds, my team and I started to develop a framework which would become Rackspace’s Service Blocks offering. The overwhelmingly positive response to our initial trial runs out of Australia were an indicator that we were onto something. Customers were excited about being able to choose the services that delivered the most value to them now, and appreciated the flexibility of being able to change services with ease in the future.
Gartner called out the Service Blocks framework as a strength of Rackspace’s in the 2019 Gartner Magic Quadrant for Public Cloud Infrastructure Professional and Managed Services, Worldwide.
So, what is Service Blocks?
Service Blocks provides customers with more choice and deconstructs the traditional managed services model into smaller components or “blocks.” There are specialised blocks that dive into areas such as cost management and infrastructure deployment. Customers can choose which blocks represent the most value to them at each stage of their cloud journey, eliminating service wastage.
Through this model, customers only pay for the services they choose. The commercial model for each block relates to the metric of value it delivers, rather than a blanket “% of revenue” model typical of Managed Service Providers.
Using Service Blocks on AWS
Service Blocks on AWS offers organisations the ability to gain support in the areas they need it the most. For example, as a large enterprise moves to AWS, they may initially need help in building and deploying infrastructure. In this instance, the customer would SELECT the Architect and Deploy block.
Likewise, at the start of the AWS journey, having operational support while processes are still new and teams are learning can be of tremendous value. Once internal teams gain experience and confidence, these activities may become accessible in-house and the customer may choose to begin leveraging the Complex Cloud Operations block instead. This block provides expertise around best practice, project work and more complex cloud activities.
As the ease of deploying new infrastructure and services on AWS becomes well known in an organisation, cost governance may become a challenge. This is when a customer may consider adopting the Cost Governance block, for example.
Service Blocks on AWS will change the Australian cloud market because it blurs the line between managed services and professional services. Serverless technology reduces the focus on traditional operations, with value now being found in deep expertise and more advanced services. This is the direction we are taking not only with our Service Blocks offering, but also the direction Rackspace is taking to revolutionise the Australian managed services industry as a whole.