While Managed Service Providers (MSPs) can enhance your business's IT capabilities, it's essential to understand the inherent risks they carry to make informed decisions.
MSPs, by their nature, have access to significant portions of your IT infrastructure, making them a prime target for sophisticated cyberattacks and threat actors seeking broad organizational impact. If an MSP’s security measures, including technical controls, monitoring, and staff training, are not sufficiently robust, the risk of unauthorized access or malicious activity increases substantially. This can result in breaches that expose sensitive information, disrupt operations, and potentially violate compliance obligations under standards such as SOC 2 or GDPR.
To mitigate these risks, it is critical to conduct a comprehensive evaluation of the MSP’s cybersecurity protocols—examining their use of encryption, network segmentation, vulnerability management, multi-factor authentication, and adherence to industry best practices. Request documentation of their cybersecurity framework, penetration test results, and certifications such as ISO 27001 to ensure alignment with regulatory and industry requirements.
Moreover, a breach at the MSP level has the potential to cause a cascading effect, simultaneously impacting multiple clients and compounding the consequences. For this reason, it is essential to inquire about the MSP’s incident response plan, including detection, containment, remediation, and notification procedures. Understand how they coordinate with client organizations during incidents and what predefined steps are in place to mitigate and manage breaches, ensuring expedited recovery and transparent communication throughout the process. Prioritizing these considerations will help safeguard your organization’s critical assets while leveraging the capabilities of a managed service provider.
Relying on an MSP means entrusting a third party with the security of your network and data. This relationship places significant responsibility on the MSP to not only safeguard critical digital assets but also to maintain the confidentiality, integrity, and availability of your information systems. While this collaboration can provide access to cutting-edge security technologies, 24/7 monitoring, and experienced cybersecurity personnel that might otherwise be cost-prohibitive, it also introduces complexity—and risk—into your cybersecurity posture. Your organization's security is only as strong as the MSP’s weakest link, which can include their policies, procedures, employee practices, and the security of their supply chain and subcontractors.
Because of this dependency, engaging with an MSP necessitates a thorough and methodical vetting process. Organizations should prioritize due diligence, examining the MSP’s security architecture, incident history, track record with regulatory compliance, and cultural alignment with your risk tolerance. This includes reviewing their security certifications, contractual security commitments, documented policies, and the results of recent external audits or penetration tests.
However, diligence cannot be a one-time event. Regular audits and in-depth performance reviews of the MSP are critical to maintaining a resilient security environment. Continuous oversight—through periodic security assessments, vulnerability scans, and technology updates—enables you to monitor the MSP’s compliance with both industry standards and your internal governance requirements. This ongoing scrutiny helps verify that the MSP adapts swiftly to the changing threat landscape and emerging regulatory obligations, proactively updates its controls, and closes any gaps before they can be exploited.
Ultimately, sustained engagement, transparency, and accountability in this partnership are essential for ensuring that your reliance on an MSP strengthens—rather than undermines—your organization’s cybersecurity resilience.
Service Level Agreements (SLAs) define the expectations and responsibilities between you and your MSP, serving as formal documentation of service standards, risk allocation, and accountability measures. These agreements often outline core deliverables such as system uptime, response times to incidents, and maintenance schedules. However, it is essential to recognize that SLAs, while foundational, can sometimes lack the granularity required for comprehensive cybersecurity protection. Vague language or the absence of defined metrics for security performance, breach notification timelines, vulnerability remediation, and data recovery obligations can leave organizations exposed during critical events.
To address these gaps, it is vital to thoroughly review and negotiate SLAs to ensure inclusion of detailed, measurable security requirements. This should encompass clear definitions of incident response processes, escalation procedures, system monitoring thresholds, and requirements for periodic security assessments. Explicit commitments to data privacy standards, regulatory compliance (such as SOC 2 or GDPR), and evidence of regular cybersecurity training for MSP personnel should also be asked for and incorporated.
Understanding the limitations of SLAs is equally essential. For instance, while an SLA may guarantee system availability and general response times, it may not specify precise expectations for root cause analysis, coordinated responses to advanced persistent threats, or timelines for restoring critical applications following a ransomware or supply chain attack. Furthermore, standard SLAs rarely address responsibilities for ongoing security improvements, proactive threat detection, or notification obligations in the event of subcontractor or third-party breaches. In these instances, your organization may face challenges recovering data or enforcing accountability if terms are not explicitly stated.
Clear, detailed SLAs provide a stronger safety net for your organization by establishing enforceable standards, minimizing ambiguities, and ensuring both parties share a common understanding of security priorities. This approach helps strengthen risk management, bolsters resilience to evolving threats, and assures stakeholders that the partnership with your MSP is built on transparency and shared accountability.
Effective oversight of an MSP requires a strategic, proactive approach grounded in transparency, accountability, and continuous alignment with organizational objectives. Rather than relying solely on contract provisions or periodic check-ins, organizations should establish a structured oversight program that integrates both operational and security-focused governance. This includes conducting regularly scheduled performance reviews, detailed security audits—including penetration testing and vulnerability assessments—and dedicated alignment meetings to ensure the MSP’s services remain consistent with current and emerging business and regulatory requirements.
A strong oversight model demands not only periodic evaluations but also the creation of open and dependable communication channels. These should facilitate immediate escalation of security incidents, prompt resolution of service interruptions, and transparent sharing of audit findings. Designating primary points of contact and enabling secure, two-way information flows help support both rapid problem resolution and ongoing process improvement.
Additionally, developing a comprehensive oversight framework enables you to systematically and objectively assess MSP performance over time. This framework should define and monitor key performance indicators (KPIs) across domains such as incident response effectiveness, compliance with security standards, system availability, patch management timelines, and user satisfaction ratings. By regularly reviewing and benchmarking these KPIs against established thresholds and industry best practices, organizations can quickly identify emerging issues, detect service degradation, or spot process flaws before they escalate into significant risks.
Furthermore, this oversight framework should include provisions for independent third-party audits, collaborative tabletop exercises to test incident response maturity, and periodic reviews of the MSP’s adherence to your data privacy and regulatory requirements. Ongoing engagement and feedback loops ensure that your MSP partnership evolves to address the latest threat landscapes, technology advancements, and organizational changes, ultimately driving continuous improvement in your cybersecurity posture and maximizing the value of your MSP relationship.