Channel Companies Would Do Well to Offer Solutions, Not Services

When a large manufacturing company came to Wisconsin-based Information Technology Professionals asking for help making sense of their big data, the service provider didn’t even have a solid business intelligence (BI) offering in place. That didn’t stop CEO Paul Hager from taking the job, though. Never saying “no” to clients is the ethos behind Hager’s business development strategy. He recruited top data analytics talent, developed a package and started providing BI. Today, it’s a key component of ITP’s business and an example of how a service provider developed a customer solution from the ground up.

In order to stay competitive in the current channel environment, VARs and MSPs are quickly learning that they must do more than simply offer services. They need to offer customized solutions that address specific customer business objectives. Increasingly, this means expanding their offerings to include emerging trends such as business intelligence (BI) and unified communications. This was a topic of discussion at last week’s CompTIA Annual Member Meeting (AMM) conference, where a panel of partners and vendors offered prescriptive advice for channel companies trying to evolve from offering static services to providing comprehensive solutions.

Steve Alexander, CEO of consulting group MSP-Ignite, says that at its core, the channel has always been about providing solutions. “When we started out, we were all solution providers,” he said. “Then it became services, how do we keep these networks up and running. Then eventually there was remote monitoring, and we said we’re all managed services providers. But we’ve always been solution providers from a sales standpoint.”

The difference between solutions and services today is adaptability, according to Austin McChord, CEO of Datto, a leading provider of backup, recovery and business continuity solutions. Customer expectations for a service such as cable or Internet remain relatively static. Solutions, on the other hand, gain value in their ability to evolve alongside business objectives and emerging technology. When providers can propose such malleable and targeted solutions, customers are more willing to take chances on new offerings.

“What you end up finding is that when you have a product that’s continually changing, continually getting better, your customers are more tolerant of you taking risks and making mistakes,” said McChord. “If you can break through that wall and deliver solutions … that are actually getting better and changing to meet the needs of the customer, that’s really what separates you.”

Stephanie Martin, CEO of service integrator Exigo, advised that the key to selling a solution instead of a service is honesty and accurate setting of customer expectations. She presents Exigo’s offerings to clients as the best option at the time in a business environment that’s constantly changing. “I think that’s a great way to deliver the solution that’s needed and to set the expectation with the client up front that this may change,” said Martin. “I may be suggesting this solution today, but keep in mind that if you want to stay nimble, you’ve got to be able to grow if [the technology] improves.”

Both the challenge and opportunity lie in accepting the fact that business technology is evolving at such a rapid pace that every provider, no matter the size, is racing to keep up. Alexander said the key to winning customer confidence is admitting that you may not currently have the solution, but demonstrating commitment to finding it and implementing it better than anyone else. A critical part of achieving that capability is partnering with other providers with different specialties. “If you don’t have the partnership out there to find pretty much any solution your client needs, there’s a crack in the door,” said Alexander. “Today that crack is going to open up wide and make it real easy for someone to step in.”

Hager says that for small-to-midsize service providers, it’s about committing to finding the solution your customer needs in order to for them to accept you as their trusted advisor. “If they do, then they should come to you with the strangest requests. And when they do that, you should say yes to all of those, and then figure out how to make that happen,” he says. “That’s where you’ll find your growth.”

In today’s marketplace, VARs and MSPs have to learn as they go in order to stay competitive. But, Alexander pointed out, this isn’t anything new. “When you first got an RMM solution, were you the guys who really should have been running an RMM solution?” he asked. “When you first started writing scripting solutions to reach into your clients’ networks and install applications, were you necessarily skilled or the right people to do that at that time?”

The channel is evolving, but in the end, it’s still about bringing the latest technologies to work for customers in order to help them reach their goals. VARs and MSPs that present their offerings in that light will go far in today’s business landscape.