MSP Insights: Challenges and Solutions
Like the rest of the IT industry, the managed service market is evolving. Business owners and IT decision makers are beginning to see the value that managed service providers (MSPs) bring to the table and more and more Value-added resellers (VARs) are choosing to make the transition to the managed services industry.
Becoming an MSP can offer a VAR an immediate path to a wide range of higher-value services that naturally complement the services that they already provide. This enables them to generate new sources of revenue and increase the overall value they can deliver to customers. However, being an MSP brings its own set of challenges and given the continued growth of MSP's overall, exploring some of these issues and how to overcome them is worthwhile.
Moving to the Cloud
A study by CompTIA found that 62% of MSPs say the cloud is a major concern as many are still unsure how to fit it into their services and plans. The bottom line is we are now living in the era of the cloud, so it is essential that MSPs understand how they can help their customers on their cloud journey as well as how to adapt to the cloud themselves.
Your clients may face some uncertainty about the cloud. Is it stable enough? Safe enough? Is it cost effective? As a result, it is not enough for an MSP to simply “resell” cloud services but rather provide an informed, trusted view as to what is the best solution. MSPs must help to educate their customer and make recommendations based on the organisation’s needs, making sure to not use jargon or over technical conversations when discussing the Cloud.
Commoditisation
Another challenge for Managed Service Providers is the increasing commoditisation of the Industry, meaning it has become more difficult for MSPs to differentiate their service offerings.
Unfortunately, it is not easy to overcome as many of the tools service providers use can be very similar making it difficult to demonstrate the value of one offering over another.
To set themselves apart and add value to their offering, MSPs need to find a gap in the market and aim to create a bespoke service that their clients will value enough to pay for. If done correctly, this can also help to secure a customer on a long-term basis.
Skills Shortage
The lack of skilled staff is one reason why organisations turn to MSPs, to complement their own in-house resources. However, a shortage of skilled IT pros is also a concern for MSPs, this problem is a result of the gradual shift away from traditional break-fix services to a world that now focusing on concepts like Digital Transformation and cloud.
To overcome this, MSPs can focus on in-house training and education, including regular meetings to help employees achieve their objectives.
A great way to mitigate against skills or expertise shortage is to work with aggregators, there is a new breed of “niche” distributors out there that can provide solutions “as a service” for example;
The cost of setting up a cloud-based back-up solution, or having the skills to deploys complex security solutions may put these offering out of reach to a small to medium reseller, that’s where the Value-Added Distributor comes in.
Imagine being able to “white label” a world class solution for your clients, maintaining your relationship but expanding your services to fully meet their needs.
MSPs that do become specialists in areas such as behavioural analytics, big data, network traffic analysis and security, can turn the skills shortage to their advantage.
Data security and regulation
Data security is always a top concern and challenge for any IT professional as new forms of malware and ransomware emerge every year and hackers are always looking for new information to exploit.
MSPs must ensure that their clients' data is always accessible, secure and recoverable and the implementation of the GDPR legislation increases the importance of educating clients on the data regulation and compliance landscape.
Summary
Becoming a Managed Service Provider makes sense in today’s IT environment but being an MSP isn’t just about taking care of clients’ IT needs. Any good MSP should also know the value of having a strong network.
MSPs will need to build a strong network with their peers, vendors, and distributors, as they can serve their clients better when they’re forming relationships with other MSPs and learning from their successes and mistakes.
Having a strong network also enables MSPs to stay up to date with the latest software and allows them to offer the best service to their customers while also staying competitive with their pricing.
The best MSPs are continuously monitoring the IT industry, assessing themselves, and growing as a company. If an MSP can distinguish itself through customer service or specialisation then there an opportunity to turn these challenges into profits.
If you would like to learn more about Managed Service Providers, discuss any MSP challenges your facing or to become a Renaissance MSP partner, please feel free to contact me on +353 1 2809410