The Hidden Risks of Relying on Managed Service Providers

Managed service providers are a vital part of IT operations for many organisations. However, if not managed appropriately, increasing reliance can introduce risk.

A common misconception is that outsourcing transfers accountability - but while MSPs manage systems, ultimate responsibility for performance, security, and continuity always remains with the organisation.

This distinction is critical as without strong oversight and governance, outsourcing IT and security to third parties can create significant risk blind spots, increasing exposure to operational disruption, security incidents, and a disconnect from business priorities.

View details on our Third Party Cyber Risk Management service.

Visibility Gaps and Hidden Security Risks

Reduced visibility restricts understanding of system configurations, monitoring, and control effectiveness. Without robust reporting, clearly defined risk metrics, and independent assurance, organisations struggle to Identify gaps, assess their risk exposure, and ensure risks are being actively and effectively managed over time.

This lack of transparency can have serious consequences. For example, vulnerabilities may go unaddressed, patching may be delayed, or security controls may not be implemented as expected. In the absence of governance, these issues can persist unnoticed until they result in a significant incident.

Building Strong MSP Governance

Governance frameworks are essential to manage this risk. Organisations should establish clear policies, processes, and procedures that define roles, responsibilities, and expectations between themselves and their MSP. This includes well-defined service level agreements, key performance indicators, and security requirements aligned to the organisation’s risk appetite and regulatory obligations, ensuring consistent oversight and accountability.

View details on our Policy Management as a Service.

Importantly, governance should not be a “set and forget” activity. Ongoing oversight is required to ensure that the MSP continues to meet expectations as the threat landscape evolves and business needs change. Regular service reviews, risk assessments, and performance evaluations provide an opportunity to identify gaps, address emerging risks, and continuously improve service delivery.

Independent Assurance and Incident Readiness

Another key consideration is independent assurance. Organisations should not rely solely on reports provided by their MSP. Where possible, independent audits, penetration testing, and security assessments should be conducted to validate that controls are operating as intended. This provides an additional layer of confidence and helps identify issues that may not be visible through standard reporting.

View details on our Penetration Testing services.

Effective governance also extends to incident management and response. In the event of a cyber incident or system failure, roles and responsibilities must be clearly defined. Organisations need to understand how their MSP will respond, what escalation paths exist, and how communication will be managed. Testing these arrangements through interactive simulations or exercises is critical to ensure readiness when it matters most.

View details on our Incident Response Optimisation service.

Aligning MSP Services with Business Strategy

Beyond technical controls, there is also a strategic element. Technology and cyber security should support broader business objectives, not operate in isolation. Organisations must ensure that their MSP’s services align with their long-term goals, risk profile, and compliance requirements. This requires active engagement from senior leadership, not just operational teams.

View details on our Cybersecurity Strategy service.

Conclusion: Oversight Is Non-Negotiable

The risks of inadequate oversight are significant. Over-reliance on an MSP without proper governance can lead to service outages, data breaches, compliance failures, and reputational damage. In many cases, organisations only recognise these gaps after an incident has occurred - when the cost of remediation is far higher than the cost of proactive management.

Partnering with an MSP should be seen as a collaborative relationship, not a transfer of accountability. Organisations that establish strong governance, maintain visibility, and actively manage their providers are far better positioned to realise the benefits of outsourcing while minimising risk.

Contact Us

If you would like to discuss how Kaon Security help organisations to establish the right level of oversight to ensure cyber security risks are being actively and effectively managed over time then contact us today.