The MSP Profession is Ours to Lose
Written by: Charles Weaver, CEO – MSPAlliance
If you catalog the list of positive things in the managed services market today, it would be a long list. There are many business, economic, security, privacy, and operational drivers thrusting MSPs to the forefront of customers seeking guidance around these issues.
And still, we tend to have a lot of individuals (mostly from within the managed services profession), who tend to complain. I will admit, there are some legitimate complaints from MSPs, but nothing that cannot be fixed. Here is my point. The lucrative future of the managed services profession is easily obtainable. It is also a future we can lose if we do not pay attention to some key issues.
Breaking Bad Customer Habits
Every MSP has experienced bad customer habits, so I will not list them all here, but these bad habits need to stop.
Easier said than done, you say. True. But, we no longer operate in an environment where the customer is always right. The customer is not always right, especially when it comes to data privacy and security. The customer is frequently wrong when failing to implement effective methods for protecting data and IT assets.
For larger enterprise customers, I acknowledge you know what you are doing (most of the time). It is primarily smaller businesses at risk for cybersecurity attacks. These same small businesses are also most likely to fight advice from their MSP on how to mitigate these problems.
Bad customer habits and decision making must no longer negatively impact MSPs. Put differently; just one bad customer can put your entire managed services practice (including your other MSP customers) at risk.
Fighting Commodity Pricing
I do not know if we will ever resolve this issue, but I can hope. I really believe most complaints around low margins can be traced back to low pricing, often triggered by a customer. I recognize that there are metropolitan areas where more MSPs are operating, and therefore, pricing can seem tight in these markets.
Even in large city centers, there are many examples of professions thriving amid steep competition. These professionals have figured out how to survive in a tight market, and it does not involve lowering prices.
Today, MSPs have more ways to sustain or raise prices on managed services offerings. The question is, will they do it?
Separating the Non-MSPs
This is a tough concept, but something every profession has to do at some point. Separating break/fix or reactive IT management companies is crucial to maintaining the managed services profession.
Part of why this needs to happen is to provide clear guidance for customers, so they know who they MSPs are. It is not enough to say “MSP” on your website; you need to be doing it every day! Selling block time over monthly paments does not make you an MSP. Sorry, it just does not.
And, just so we are clear, I am not saying that these reactive IT companies cannot join the ranks of the MSP professionals. In reality, we need more qualified MSPs. What we do not need are companies pretending to be MSPs, when in fact, they are something very different.
These are significant and somewhat philosophical issues. Some of you may say, how does this impact me? Well, when over $375 billion is at stake in the global managed services profession, there are a lot of reasons to take these issues seriously.
I remain optimistic about the MSP profession. But, I also remain realistic. This profession is ours to lose.