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5 Ways to Improve Your MSP Service Level Agreement (SLA)

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5 Ways to Improve Your MSP Service Level Agreements (SLAs)

SLAs are the foundation of your MSP business. They are essential to building strong client relationships and must be clear, reasonable and well-constructed.

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8 Ways to Become an Elite MSP

Posted March 29, 2014by Ray Vrabel

If you’ve been following our March Madness posts, you’re all caught up on the “Sweet 16” stats that every MSP should know about cloud-based services. Next up on the roster: strategies to up your game, and earn you a place among the elite—Elite 8, that is... or at least the MSP equivalent. There are many factors that contribute to the success of your managed services business – and working to improve all facets of your business will help you become an elite managed services provider.

1. Be a Consultant, Not a Technician.

Although there’s no question that you’ll always have to take care of technical issues, an elite MSP understands that there’s a big difference between just being a tech and being a consultant. Techs are a dime a dozen and easily replaceable; consultants serve as trusted advisors who understand the goals of their customers’ businesses. These days, businesses need a consultant, not just a repairman. They need someone to call when they have questions about cloud migration, server virtualization and data security – and they rely on the MSP as that guide.

Acting as a technology consultant is a key step in becoming an elite MSP. Fire yourself as a technician and embrace the life of business ownership, positioning yourself as a trusted advisor to your clients.

2. Focus on Your Clients’ Success... And Yours Will Follow

The most reliable revenue stream comes from successful customers, both in the short-term and long-term. When you focus on your clients’ successes, your clients can reach their business goals faster, and are more likely to refer business your way and purchase additional IT services through you. While many MSPs focus on upselling service plans or equipment to increase their margins (regardless of what the customer really needs), an elite MSP goes above and beyond to ensure that their services are really what’s best for their customers’ businesses.

When you focus on your customers’ needs, the upselling process happens more easily. If you immediately start forcing services down their throat, they will become skeptical of your intentions and may even fire you as their managed services provider.

If you focus on making your clients more successful, their loyalty will lie with you as the trusted advisor who helped get them meet their goals. The secret to MSP success is in helping your customers achieve the growth they’ve envisioned for their business, which in return, will help you achieve your own growth.

3. Don’t Get Too Remote

In the tech world, it’s all too easy to fall into the trap of digital convenience—communicating mainly by email, rarely calling and certainly never putting in face time. And with the advent of remote monitoring and management (RMM) software, you can perform all of your services from one location without needing to visit client sites. This is obviously an advantage for managed services providers, as it makes you more efficient and able to handle more devices. However, you have to be aware of how this affects your client relationships.

Many MSPs are currently suffering from becoming too remote, which is damaging their client relationships. Your clients like seeing the work that you do, and even if you can monitor all of their devices remotely, it doesn’t mean you always should.

Elite MSPs can set themselves apart by dropping by in person on a regular basis. There’s nothing that builds customer loyalty faster than to feel appreciated, and face-to-face contact is a great way to show your clients that their business matters to you. Make a point to schedule regular meetings with your clients or at a minimum, give them a call to check in and ask if they’re having any IT problems.

You may be surprised how far a simple phone call can go.

4. Make Sure Your Employees Have the Right Incentives

When it comes to growing your managed services business, most people will look externally for opportunities. However, it’s important to look internally at your own company to make sure you’re ready for growth. Sometimes, the biggest hindrance to growth is that your internal structure isn’t aligned with your business goals.

A happy employee is a huge benefit to your business as a whole. Happy employees are more productive and less likely to leave, which both add to your profitability as an MSP. There are a number of factors that contribute to employee happiness, but one of the biggest is compensation. You don’t need to break the bank paying your employees, but make sure your employees’ compensation packages are aligned with your business goals.

  • Are your technicians motivated financially to work faster and handle more devices?
  • Are your sales people motivated to sell monthly recurring revenue versus big one-time fees?
  • Are you rewarding your employees for hitting team goals?

These are all questions you should be considering when it comes to building incentive plans for employees.

There are also a number of other strategies you can use to keep employees happy. Company culture, educational/learning opportunities and even just taking employees out for occasional drinks all help to keep employees engaged, committed and content with their job.

Your internal team is what powers your business, and keeping them happy and aligned on company goals is an important aspect of becoming an elite managed services provider.

5. Showcase Your Expertise Online

Generating your own leads is crucial if you want to reach “Elite” status. Many MSPs rely on referrals and word-of-mouth to find new business. However, this is like trying to win a national championship with a bunch of walk-ons. To become an elite program, you need to generate some buzz, some awareness and start bringing on some scholarship athletes!

Your own clients may know you’re championship material, but what about the rest of the industry? Marketing yourself online is a great way to establish yourself as thought leader and respected voice among the MSP industry. Not only will this enhance your reputation among business peers, but a more robust online presence will also help generate your own leads and grow your business.

It’s easy to get started in online marketing, and never too late. Start a blog to share your unique expertise, or commit to being more visible in prominent online circles. Collect email addresses and trying out some email campaigns. Hire a contractor to create and manage your social media accounts. There are plenty of ways to make your IT expertise shine online, which will help you stand out from the crowd and not have to rely on referrals in order to find new business.

6. Eliminate Risky, Non-Scalable Costs

All businesses want to increase their profitability. One component of that is increasing your revenues. But the other side to profitability is cutting unnecessary costs. Many MSPs will look to increase their revenues by adding new clients (which is great). However, adding new revenues doesn’t always mean adding to your profits. Believe it or not, clients may actually be costing you money! Make sure you understand all the costs of doing business, which includes the cost of finding new clients and delivering your services, as well as intangible costs like your reputation in the market.

It’s great to treat your clients well, but don’t establish yourself as someone who gives away freebies at the expense of your business.

There are also a number of hidden costs most MSPs don’t always notice. These costs don’t always have to be eliminated, but they should be accounted for. If you can’t predict costs, you can’t budget for them, and this ultimately eats away at your profitability.

7. Simplify Your Pricing

Pricing models are one thing that still haven’t become consistent among MSPs. However, simplifying your pricing strategy has time and again proven itself to be a winning solution. Some people think that the more options you provide the better it is for your clients. Sure, it’s important to customize your solution to fit your client’s needs, but that doesn’t mean that your pricing should give them every option to choose from. This will delay your sales process dramatically and make your client focus on what costs they don’t need to buy from you, rather than feel like they’re getting services included with a fixed cost.

By simplifying your pricing and bundling your services, you protect your margins and speed up the buying process. Sometimes, the less options you provide, the better it is for you and your clients.

Here are some tips for pricing strategies in 2014.

8. Improve Your SLA

A well-crafted SLA will help clarify your duties and responsibilities, plus help set the stage for your customers to develop realistic expectations about your services and limitations. The right SLA serves as the foundation that both parties can always return to in a worst-case scenario, which is critical for maintaining strong business relationships through feast or famine. There are plenty of ways you can improve your SLA, but the primary one is to be honest about the results you can deliver, and never oversell your service offering.

Well, there you have it—8 ways to become one of the elite. Stay tuned for the next installment of our March Madness blog series, The Final 4 Steps to Closing New Business.

Improve-MSP-SLAs

Ray Vrabel is Continuum's Director of Technical Account Management and participates in product and service growth initiatives, and also manages Continuum's Technical Account Management team, which supports over 3,500 partners worldwide. Prior to Continuum, Ray joined Zenith Infotech in 2005 and held several positions including Service Desk Manager, Sr. Technical Account Manager and Sr. Manager of Service Operations. He currently has over 15 years of experience in the IT industry, specializing in Managed Services, Disaster Recovery, and Cloud Solutions. Prior to Continuum and Zenith, Ray worked at ANH Refractories, a world-class provider of Refractories products, in their Service Desk Department supporting 53 locations and 1,500 employees. Ray also worked for a startup venture at Body Media a pioneer in wearable body monitoring systems as a technical lead in their Technical Customer Support Department. Ray holds a Bachelors of Science in Business Technology Support and Training from Indiana University of Pennsylvania.

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