How Managed Colocation Transformed One Hospital’s

Managed colocation has become a strategic option for organizations requiring resilient IT infrastructure without the burden of full in-house management. In one case a regional hospital confronted rising demands for digital imaging workflows, electronic health records access, and stringent compliance requirements. By transitioning to a solution hosted in a specialized colocation data center with hands-on support from a managed services team, the hospital achieved improved uptime, enhanced security, and a predictable operating expense model. Examining this transformation yields practical insights for IT decision-makers weighing options between on-premises assets, basic colocation, and fully outsourced models.

Framing the Challenge

A midsize hospital operated legacy servers and network gear within an enterprise data center on its campus. That setup introduced several obstacles:

• Limited capacity to scale compute and storage during peak patient loads
• Manual patching and maintenance that risked unplanned downtime
• Inconsistent environmental controls leading to hardware overheating
• Complex compliance audits for HIPAA and other regulations
• High capital investment in power, cooling, and physical security

These factors hindered the hospital’s ability to deploy new applications such as real-time telemedicine and advanced analytics. IT leadership recognized that simply expanding the on-premises footprint would exacerbate operational costs and stretch staff resources. Instead, they evaluated alternatives including public cloud, traditional colocation, and managed colocation.

Evaluating Infrastructure Criteria

Selecting the right hosting environment required a structured assessment of critical factors. The hospital’s IT team developed criteria around:

1. Physical Facility Standards

• Tier rating, redundant power and cooling, fire suppression
• Biometric access controls and 24x7 surveillance

1. Connectivity and Performance

• Diverse carrier access and scalable bandwidth (data center connectivity)
• Low latency for imaging systems and electronic records

1. Managed Services Scope

• Remote hands support for hardware installations and troubleshooting
• Proactive monitoring, patch management, and security audits

1. Compliance and Security

• Adherence to PCI DSS, HIPAA and SSAE 18 frameworks
• Regular vulnerability assessments and incident response

1. Service Level Agreements

• Guaranteed uptime metrics and response times for critical alerts
• Penalty structures aligned with hospital operational goals

1. Cost Structure

• Transition from capital expenditure to operating expenditure
• Transparent colocation costs with fixed monthly fees

1. Scalability and Flexibility

• Ability to upsell rack space, power and network as demand evolves
• Options for short-term projects or long-term growth

1. Provider Stability and Support

• Financial health, industry certifications, and proven track record

These eight considerations echoed best practices for choosing colocation providers and framed the hospital’s vendor evaluation process.

Implementing Managed Colocation

After narrowing the field, the hospital engaged a managed services specialist that offered a comprehensive approach to colocation. Key steps included:

1. Detailed Site Audit
   The provider’s engineers reviewed existing hardware, cable layouts, and power requirements. This audit informed rack design and optimized airflow paths.

2. Migration Planning
   A phased cutover plan minimized clinical disruptions. Non-critical systems migrated overnight while core patient-care applications shifted during scheduled maintenance windows.

3. Rack and Cable Management
   The service included specialized cable sleeves, locking receptacles, and color-coded mapping. These measures reduced the risk of connection errors and simplified future expansions (TRG Data Centers).

4. Remote Hands and Monitoring
   On-site technicians performed routine tasks such as hardware swaps, firmware updates, and emergency component replacements. Centralized dashboards provided 24x7 visibility into power, temperature, and network performance.

5. Compliance Validation
   The provider conducted HIPAA readiness assessments and generated audit logs for change management. This proactive stance eased the hospital’s annual compliance reviews.

6. Ongoing Collaboration
   Regular governance calls ensured alignment on service levels, upcoming capacity needs, and emerging security threats. IT leaders gained confidence that the vendor’s objectives matched the hospital’s long-term strategy.

This structured rollout exemplified the benefits of outsourcing physical infrastructure management while retaining control over server configurations and software stacks.

Realizing Operational Benefits

Transitioning to a managed colocation model delivered measurable advantages across multiple domains:

• Enhanced Reliability
  The solution provided a 100 percent uptime SLA for core systems, greatly reducing unplanned interruptions (TierPoint).

• Cost Predictability
  By shifting to an Opex model, the hospital eliminated major capital outlays for new chillers, generators, and power distribution units.

• Strategic Staff Utilization
  Internal IT staff refocused on application development and clinical support, rather than day-to-day hardware maintenance.

• Security and Compliance
  Automated patching, virus scanning, and quarterly security audits reinforced data protection and regulatory adherence (Volico).

• Scalability on Demand
  The hospital adjusted rack space and network capacity during seasonal patient surges without protracted procurement cycles.

• Disaster Recovery Readiness
  Replication to a secondary facility supported rapid failover scenarios, safeguarding data continuity.

These outcomes align with the broader benefits of data centers and underscore the value of externalizing routine operations.

Infrastructure Model Comparison

This table illustrates how managed colocation bridges the gap between owning data center assets and relying solely on public cloud platforms.

Measuring Impact Metrics

To quantify return on investment, the hospital tracked these key metrics during the first year:

• Uptime Improvement
  System availability rose from 99.2 percent to 99.99 percent, minimizing elective surgery delays and record access errors.

• Cost Reduction
  Total IT infrastructure spending dropped by 18 percent when allocating operational budgets to managed services.

• Staff Efficiency
  Three full-time equivalents shifted from hardware support to network engineering and cybersecurity initiatives.

• Deployment Speed
  New server deployments accelerated from an average of four weeks to five business days.

• Compliance Costs
  Audit-related expenditures fell by 23 percent thanks to automated reporting and proactive risk mitigation.

These figures demonstrate how a well-executed managed colocation strategy can drive both operational resilience and financial discipline.

Key Takeaways and Conclusion

The hospital’s experience highlights several strategic insights:

• Organizations may consider externalizing physical infrastructure tasks to specialized teams in order to focus internal resources on core missions.
• A rigorous vendor evaluation process ensures alignment on SLAs, security practices, and scalability needs.
• Managed colocation combines the control of owned hardware with the predictability and support of a fully managed environment.
• Clear metrics from the outset enable IT leaders to measure impact, justify budgets, and refine technology roadmaps.

Compared to traditional colocation or pure public cloud solutions (colocation vs cloud), a managed approach offers a balanced path to high availability, compliance, and cost predictability. For B2B decision-makers in healthcare and beyond, this model may represent an optimal compromise between CapEx burdens and operational agility.

Need Help With Colocation Strategy?

Need help with selecting the right colocation solution for your organization? We help by assessing technical requirements, evaluating colocation services offerings, and identifying trusted managed data center partners. Our experts guide you through SLA negotiations, compliance checks, and ongoing governance. Let us connect you with the ideal provider so your IT team can focus on driving innovation. Contact us today to explore next-generation infrastructure solutions.