Becoming a successful cloud-era MSP
Posted by Amy Babinchak on 13 November 2017 11:17 AM
I’ll put my bias right up front. I’ve owned an MSP for 17 years and I’ve never understood the movement toward a less service-oriented business model nor one that depends on the continuous churn of sales margin. At many conferences over the years, I’ve heard how we all need to make everything into a process and automate it using tools, not people. Tools definitely have their place, but they should never be used to replace service. Business turns on the quality and breadth of services your offer. Managed. Services. Professional. Service is literally in the middle of things, in the thick of it, at the center of what we do and it needs to be a passion for the successful cloud-era MSP.
You’ve been migrating your clients into the cloud, but have you migrated your own business practices, procedures, offerings, contracts? Have you figured out how your business model remains relevant to your client once they are fully in the cloud? Have you determined what makes your business unique when everything from helpdesk to business continuity to licensing is a commodity? Everything is going to become a commodity very quickly, including cloud-era MSP services.
Make no mistake, this is going to be a difficult process for many. We’re all off to the cloud, and MSPs need to start changing their monitoring and maintenance practices. The new cloud-era MSP needs to focus on what is important to the client now that their data and applications are in the cloud.
What should the focus be now?
The focus as always needs to be on the business, but because we’ve moved our clients from on-premises to at least hybrid infrastructure environments, it’s a whole new world, and if you think delivering helpdesk and monitoring as your primary client interaction is going to carry your MSP well into the future, it is time for a look in the mirror, because this is a losing strategy. While it’s true that helpdesk is the center of every IT practice, as a cloud-era MSP you are going to have to build new practices around it. What do your clients truly value that you provide today? I suggest that you not answer that question but instead query your client base. Use the Forms app in your Office 365 subscription to let them rank your current service offerings in importance anonymously. Ask them if they even knew that you offer those services first. You might be surprised at the results, but they will help clarify what you should carry forward and what you want to drop or rebrand.
I did this with my clients. I had already shifted my business toward cloud-related services that I thought would be most useful to business in the moving to full cloud part of this great migration, so I was pretty certain that I knew what they were going to say. I was right! And I was wrong!
The survey says
We asked clients what they are the most interested in.
From the graph above we see two pretty distinct things. Companies are concerned about whether they are headed in the right direction with their technology. This makes sense because we’re in a time of great change. They are also rightly concerned about ransomware and other types of attack. This also makes sense because it’s been everywhere in the news. What we need to do, as a successful cloud-era MSP, is make sure that they see us for the leaders that we are on these issues.
The second thing that we see is that these businesses are not yet worried about who has their data, staying in compliance with regulations, or figuring out how best to use the new technology at this disposal. However, the red item indicates that they are wondering if their staff is up to the task.
Another question we asked was if there was anything in this list that they didn’t know we offered to them. We feel like we’re talking about these items until we’re blue in the face, but obviously some of the messages are not getting through. Everyone knew that that we did server and cloud migrations, but there were some glaring items that they claimed to not know. Gotta say that this made me and my staff quite sad. We’re doing some great work in these areas for some of our clients but obviously we’ve got more work to. We need to raise awareness of our full skillset.
Here’s what they said:
These are items that we’ve been talking to our clients about via our blog and in one-on-one meetings. Interestingly, the responses also tell us where they have not received our message. Sure we’ve changed internally, but did we communicate that well enough to our clients? It seems not. The absolute most disturbing item in this list was vendor management. We do this every day for every client and yet it was the highest-rated item that they had no idea we did. That budgeting, training, and LOB consulting also ranked so high was also disturbing.
If you sell something, tell your clients when you deliver it
Words are important. In IT, we use certain words and phrases to refer to things that we do, and those words don’t necessarily have any meaning to our clients. Take the example of vendor management. Why do our clients not know that we provide this service to them? We spend a great deal of time working with our clients’ vendors. For example, clients call us when they have a problem with their leased copier, and we work with the copier company to resolve the issue. The copier company in turn calls us when they need to schedule a firmware upgrade. When it’s time to make a purchase from a vendor, we do the research and bring forth the best options. This is vendor management to us.
However, in our survey, vendor management is something that our clients say they weren’t aware that we do. That’s 100 percent on us. A look in our ticket portal where we record the work that we’ve done for each client and there’s no vendor management there for any client. We are not using those words and yet the words vendor management are in our contract as a service we offer and on our website for prospective customers. I have since implemented a standardization of our helpdesk ticket subjects that matches the list of services that we have told clients we are performing under our contract so that they can match them up. It seems so elementary.
As the migration to the cloud continues, our clients will be working with more vendors, not fewer, because every application and app has a different vendor. Managing those vendor relations will become a bigger part of the work that we and any cloud-era MSP needs to do — and that your clients expect to be done. This is a growing area, and our clients need to know that we’re on top of it. No longer is the MSP the sole provider, or maybe they are, but the reality is that your client knows that you don’t make the VOIP system or own Salesforce or Office 365 or their copier lease but they definitely expect you to manage it for them.
Where does a cloud-era MSP go from here?
As I have just shown, you can think that you’re doing something for a client but they don’t know it. You can prepare and train your staff, but just because you’re doing that work for some of your client-base — budgeting and training, as examples — doesn’t mean that the others have realized that you offer these services. Perhaps the only reason you aren't doing more consulting services is because your clients don’t know that they can call on you to do it? Instead of saying “we do this,” we’re going to shift into case studies and hope that our clients might see themselves in those examples.
A friend of mine uses the obnoxious phase “always be pimping” to explain that you need to continue to over and over again communicate your services to your clients. It’s not enough to “land the contract”; instead you need to continuously educate the client to nurture that contract into the coming era. That’s what being a successful cloud-era MSP is all about.
About Third Tier
Established in 2008, Third Tier only works for IT Professionals by providing them with access to advanced support services. No one can know it all these days, so we give IT pros a place to go to get the hands on support they need in areas they normally don’t work in or problems they’ve never encountered. We also work on projects, fix their accounting practices and do many, many migrations and other installations. Our staff covers a wide range of technologies.