10 Ways MSPs Must Change in 2014: Sales, Marketing, Technology

How’s this for ironic: The managed services market continues to grow, but mastering the MSP business model remains incredibly challenging. So how must MSPs evolve amid more market shifts heading into 2014? Here are 10 suggestions.

1. Are You a Best of Breed Company?: How do your key performance indicators (KPIs) — customer satisfaction rates, profit margins, growth rates, revenue per employee, etc. — compare to industry averages? If you don’t know then it’s time to spend some time in a peer group (HTG and TruProfits come to mind). Or reach out to industry experts like Paul Dippell at Service Leadership Inc. or Gary Pica at TruMethods.

2. Can You Disappear for Multiple Weeks?: What would happen to your business if you (the CEO) disappeared for two, three or four weeks? At Mainstay Technologies, an MSP in Belmont, N.H., CEO Ryan Barton will unplug soon for a multi-week honeymoon. COO Brock Kuhse says the company will be just fine until Barton returns because there are clear roles and responsibilities across the company. Can your business stay the same?

3. Can You Balance Best of Breed vs. Suites?: MSPs can continue to buy point management products from individual vendors. Or they can bet the business on integrated suites. You know the names and approaches. But have you really studied the business strategy of each vendor, and the potential implications for your business?

4. Got an Amazon, Office 365 and Google Apps Response?: How exactly do you plan to compete or cooperate with the major cloud services providers — across SaaS, PaaS and IaaS? If you still don’t have an answer you’re now about two years behind market-leading MSPs. 

5. Can You Sell Cloud — In Every Proposal?: For every business proposal you make, can you swap out your traditional on-premises solutions with cloud solutions? If not, start studying cloud solutions that will fill your service gaps.

6. Can You Sell Per User, Per Location, End User Experience?: I know the per device pricing model remains popular with many MSPs. But everywhere I turn, I’m hearing from more and more MSPs that promote per-user pricing while talking up end user experience. 

7. Can You Hold A Conversation With Vertical Market Experts?: MSP-centric technology events can help to shape your business for years to come. But sometimes the best business ideas are imported from other industries. To invade those industries and gather some market intelligence, consider attending HIMSS 2014, National Retail Federation 2014 and other vertical-market events.

8. Can You Think Long-term?: The Big Four IT trends in 2013 involved cloud, mobile, social and big data. The best MSPs are doing reasonably well with cloud and mobile. Most MSPs are weak with social. And I only know a handful of MSPs profiting from big data. Study those markets to determine if you’re getting in or skipping the wave(s). And watch out. The next big wave likely involves managing the Internet of Things.

9. Can You Name 5 New Companies You Didn’t Know In 2013?: You know the giants (Microsoft, IBM, HP, Dell, Cisco, etc.). You know the MSP suppliers (PSA, RMM, BDR, NOC, etc.). But can you spot next-generation vendors that might change the market? Your next opportunity to do so is likely at IT Nation 2013.

10. Get to Know CSBs and CSAs: Cloud Services Brokerages and Cloud Services Aggregators are two of the fastest-growing communities in the IT channel. Find some details at www.talkincloud.com/csb. Traditional distributors like Ingram Micro, Tech Data, Synnex, Arrow and Avnet are evolving to address cloud services. And next-generation SaaS distributors are set to emerge. (Take a look at Excel Micro for one example). Now ask yourself: Are there new, different ways you should be sourcing products and services?

11. Bonus A – Ignore Conventional Wisdom: Conventional wisdom says MSPs need to master Google Adwords and other pay per click (PPC) tools for online marketing and lead generation. Most MSPs would ignore Microsoft Bing as part of that conversation. But that could be a mistake. I’ve heard LabTech Software has been shifting about 10 percent of its PPC budget toward Bing because Microsoft’s search engine is delivering good results. 

Another example: Many MSPs consider LinkedIn a platform for business, and Facebook a platform for consumers. In many cases, Google+ isn’t part of the conversation. But give it a try. You might see some incredible SEO results — all organic.

12. Bonus B – How Would You Start Over — From Scratch?: Let’s assume you’re launching an MSP- or CSP-centric business right now. You’re starting everything from scratch. What services would you offer? What staff would you recruit? What customers would you serve? Ask those questions right now then compare the answers to your current company. How do you get from that existing business to that new, built from scratch business? Answer that question and perhaps you’ll compete more effectively vs. born in the cloud CSPs.

How might you change your approach to business in 2014? I’m all ears.