CEO Forum: SMB Transformation, vCIOs and Driving MSP Growth

In my 30-year career in software, there is a constant in the technology landscape — progress, innovation, and disruption.

But, right now we’re in the thick of a remarkably dramatic period, even for technology.

It’s actually bigger than just the emergence of the Internet.

It’s the digital transformation of business.

Software is Eating the World

Marc Andreessen, an American entrepreneur, investor, and software engineer, has a description for this transformation: “software is eating the world.”

Cattini

His argument is that entire industries are being disrupted and consumed by software.

Even industries that haven’t shifted their whole distribution and commerce models to digital are being transformed by the building blocks of software (i.e., agriculture, healthcare, electric cars).

The reason this is happening now is that all the conditions for a digital economy are finally available to the public at scale.

The Internet (ultimate network), broadband for everyone, highly efficient software frameworks and development tools, open source code, and consumption-based cloud computing all lower the barriers for innovation and startups.

Digital Transformation

The overarching trend driving all of this change and opportunity is the digital transformation of business:

Facing Challenges and Creating Opportunities Together

All of this change and disruption generally creates opportunity, but it’s an especially big opportunity for MSPs because your sweet spot is SMB/SME.

The accessibility and affordability of technology is driving massive new adoption in the small and mid-markets.

SMBs’ spend on technology and software adoption is growing faster than the market in general.

Consider the magnitude of the IT market for SMB: $600 billion is a massive opportunity; 72 million SMB worldwide and at least 2 million a year will adopt technology for the first time.

The rest will expand their adoption as new technologies emerge and are available at scale. According to IDC, software spending is growing even faster due to cloud adoption and the democratization of solutions.

They predict that software spending will outpace hardware spending within the next calendar year.

That would have been unimaginable even 20 years ago.

All of these businesses want to enter the digital economy but need advice, solutions, orchestration and specialization.

Acting as the vCIO for SMBs Becomes Critical to MSP Success

Forrester Research advises that CEOs will expect CIOs to grow out of being mere custodians of technology, and to actively wield technology to drive revenue instead.

This is an opportunity for MSPs to take a seat at the table, make strategic recommendations that impact business growth, and bring their unique expertise to help speed selection and deployment. In essence, they need to assume the role of a virtual CIO for SMBs.

I’d go so far as to suggest that MSPs need to think of themselves as, not only the vCIO, but as business technologists.

The potential is there for MSPs to realize 29 percent growth as a result of helping SMBs transform processes via digital technology.

MSPs are uniquely positioned to help drive innovation and growth, with a 360-degree view of all the technologies implemented across the organization, insight into the results being delivered and the impact those results have on the organization as a whole.

That insight can greatly impact major business decisions.

Ultimately, MSPs that use a professional services automation solution can provide access to the core metrics and trends associated with the technologies that SMBs deploy.

That awareness is a powerful tool for analyzing past performance and making better, fact-based decisions about the business.

MSPs alone are in the position to deliver that insight to SMBs.

For MSPs that are able to shift into the role of vCIO/business technologist, it will be important that they help SMBs make a successful digital transformation that aligns with the overall business goals and delivers ROI that demonstrates quality, efficiency, and security.

This influential position can do more than perpetuate growth throughout verticals.

It can shape the landscape of revenue projections and key drivers, such as industry compliance and protection, for years to come.

Mark Cattini is President and CEO of Autotask Corporation.