More service providers and value-added resellers (VARs) are facing increasing competition for clients. An expanding marketplace of suppliers is forcing price competition and falling margins. These companies are beginning to gravitate to IT management software.
The most commonly outsourced IT among Canadian companies involves security for their networks. In a technical world where such specialized areas of service are becoming marketplace commodities, building an MSP company from a VAR or specialized service shop is possible with an IT monitoring platform, but not easy.
VARs and tech services companies are having to look for insights and techniques on becoming a successful managed services provider. Here are a few good ways to start.
Sell the company, not the service
Clients are looking not so much for what can be done as they are the trustworthiness and credibility of the provider. Instead of being yet another provider, companies should focus on developing a brand in order to attract leads. Part of this is seeking a relationship as a trusted advisor first, and a provider of general services second. It is guidance and expertise that build client trust, essential to maintaining a long-term association.
While MSPs are popping up everywhere, the satisfaction of clients across other industries may be decreasing. It’s important to treat new clients as not just “sign-ups” but as potential partners that can provide the recommendations and social marketing opportunities that lead to more clients. It’s after-sales service that provides the real value. A majority of Canadian companies have chosen an MSP because of the quality of their customer support. An RMM (remote monitoring and management) solution is important to providing quality service.
VARs moving into the managed services field need to be familiar with standard MSP contracts and the various details. These should include service level agreements (SLAs) to outline exactly what the client can expect from you at a minimum. These should be realistic enough not to create headaches and undermine profits, and be clearly stated and explained to the client before contract signing so there are no surprises in the future.
The MSP business model
MSPs must retain profitability while still attracting the top technicians and engineers to ensure that quality performance is passed on to customers. Remote management and support means round-the-clock service while coping with changing technologies and climbing pay rates. Insufficient resources could lead to prioritizing customer needs, which will only lead to loss of the customers low on that list.
Being a managed services provider affords a quick path to high-value resources that VARs and tech companies already have experience with. It also represents a proven business strategy to expand core services into other profitable offerings.