“I skate to where the puck is going to be, not where it has been.” ― Wayne Gretzky
Wayne Gretzky called it right. Every MSP or IT service company business owner should take his advice. It seems our industry has turned into a fast hockey game and we need to know and plan for where the puck is going.
We could use all sorts of metaphors and business ideologues to describe how the MSP industry is evolving. But the common denominator is in how quickly it is occurring.
Simply look back and it’s easy to see how our IT services and solutions ebb and flow, juke and jive, towards one end of the spectrum, only to see where the pendulum starts swinging back the other way. My view is that we’re at the top of the pendulum and swinging back towards the other direction.
What once used to be the purvey of premise-based applications, is now in the cloud. Back in the 80’s, it was moving from centralized mainframe to distributed client-server, and now back to centralized cloud services.
As MSP business owners we need to understand the impact of this on our service levels, and more specifically, the value proposition of our managed services.
Have you ever had a client call you and say “We just moved our <fill-in-the-blank> software to the cloud, what do we need you for now?”. Please don’t be fooled into thinking it’s your ‘great service’ or ‘great relationship’ that will save you from a client defecting.
When this occurs, what changes do you make to thwart off other defections? How do you respond to clients who perceive a declining value in your services?
Answer: Skate to where the puck is going.
It’s inevitable that the traditional MSP value proposition is changing. This is especially true for MSP’s with a singular focus on infrastructure support. Gone are the days of server blue-screen, defective RAM chips and office cabling. End-user service tickets are more directed around business workflow issues rather than local hardware matters. RansomWare is our most direct threat.
So where is the puck going?
As alluded to earlier, I believe the pendulum is starting to swing back the other direction.
To explain, I’ll use a conversation I had with a friend of mine that is the lead partner of a local accounting firm. This firm has moved their entire application stack to the vendor’s cloud; sound familiar? They use a local MSP and are paying a fixed monthly fee.
This accounting firm is now reconsidering the value of their MSP’s service. They have no more premise-based application servers, use Office365 and the majority of their service tickets are related to issues with their MSP’s own private cloud. Adding to this, most of their simple office technology needs were being taken care of by an internal staff person.
All-in-all, a great client for the MSP and a profitable one. Yet, this MSP is vulnerable, and they don’t know it as the accounting firm partner is questioning their value.
Consider this: If the key line-of-business applications are in the cloud, file sharing is in the cloud, email is in the cloud, backup in the cloud, etc, how does the MSP demonstrate their value proposition?
Where is the MSP value proposition skating to? Is it in traditional help desk services? Or in the vCIO services? I believe it is more in the latter, and that is where we should all be skating towards.
Many MSP’s have invested heavily in creating a superb service desk with quick response times, expert service and wide coverage. As key applications move to the cloud, the MSP’s value prop drops. Many companies today have staff with millennials that are quite comfortable with adding a printer or have an HR person that is quite capable of adding/delete a user and assigning security policies.
Bottom line: As businesses become increasingly more adopted towards centralized cloud solutions, MSP’s need to adjust their service offerings accordingly. Focus on those services that offer the highest and best value proposition. This may mean re-engineering the MSP business away from the traditional model that features service desk; is it time to outsource?
It may mean that your vCIO function also evolves away from traditional infrastructure consulting to that of a business practitioner that focuses on a vertical. Moving forward, the more business focused your service, the more value will be perceived from your clients.
Skate to where the puck is going, and you’ll be fine.
About the author: Tommy Wald is an MSP business consultant and author of “The MSP CEO: Your Guide to Building a Successful Business.” Tommy may be reached at Tommy@TWTechVentures.com, or go to www.mspceo.com.
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