Managed services offerings are outsourced IT functions such as network management, security management, or data backup and recovery, including the management and maintenance of those services. When you set up your MSP, one of the first steps is choosing which services to offer and how much to charge for them. There’s a step-by-step process to follow as you build your offering, plus some tips to keep in mind.
6 Key Components of Strong Managed Services Offerings
Other than providing the key services, your MSP offering needs to have a few basic components to be of value to your target market. These involve everything from consulting to after-sales support. The top components to focus on are a proactive approach, strategic advising, business continuity and disaster recovery, cybersecurity, mobility, and end-user support.
Specifically, these are the components the strongest offerings include:
- Proactive Approach: Customers want to partner with MSPs who proactively stay on top of the latest developments in the IT sector and add regular updates to their network. Rather than focusing on maintenance and fixing issues, allocate resources to apply the latest developments to your service offering.
- Strategic Advising: As an MSP, you should offer chief information officer (CIO) level support in the form of strategic advice. Ensure the client has the latest IT tools that align with their business goals and objectives, and quickly resolve any issues that might come up.
- Business Continuity and Disaster Recovery: Top MSPs provide backup and recovery services along with disaster recovery, business continuity, and ransomware protection to remain competitive and relevant. Backup and recovery services are sometimes included as a part of data protection, along with data privacy and masking.
- Cybersecurity: Cybersecurity includes managed detection and response of viruses or malware, firewall as a service (FWaaS), virtual chief information security officer (vCISO), security information and event management (SIEM), and security operations centers (SOC). While some of these might need experienced cybersecurity personnel, companies expect MSPs to offer at least some form of cybersecurity services today.
- Mobility: As mobility has become an essential factor in the workforce, networking services are in demand. Possible services are software-defined wide area networks (SD-WAN), secure access service edge (SASE), and access control. If you plan to offer managed networking, you can bundle this with cybersecurity offerings or vice-versa.
- End-User Support: If you’re not offering robust support for your users or outsourcing support functions, gaps in your service offering may arise from communication issues. Ensure that your support services cover all of your users and eliminate the barriers to support.
By incorporating these components into your list of service offerings, you can create actual value and better enable your customers in their business activities. Before you plan to add to your managed service offering, you must also analyze whether you can apply your services to their full potential. Consider solving a problem or set of problems in their entirety.
How to Create Your Own Managed Services Offerings
There are eight key steps to building your own MSP offering. Start by choosing your services and figuring out your opportunity and vendors. Set your pricing and begin marketing to customers, making sure you have a way to deliver your services. Eventually, scale your business and diversify by adding more services.
1. Pick Your Services
First, decide whether to manage clients’ software and/or hardware. Your choice of offerings will comprise services that are in demand and you have expertise in. A good place to start is with what you already know or can easily learn, since this can create a recurring revenue stream without adding undue risk. Also measure the potential revenue against the cost of providing the service along with the basic services that every MSP must provide.
2. Bundle Your Services
Once you’ve researched and chosen your options, develop a bundle of services that go well together as an offering. The idea is to provide a complete solution to a particular set of problems. The technologies involved can be too expensive for many companies, which creates a service opportunity for you. You can create one bundle to start, or you can establish tiers with different levels of service included in each one.
3. Identify a Vendor
Next, you’ll need the right vendors for the solution you’ve chosen to offer. Start by reviewing any existing vendors you work with. Go through the agreements and also assess the possibility of new partners. Compare the quotes from different options against the service support you can get for your clients. Don’t overlook any hidden charges, including small charges that might compound in the long run.
4. Set Your Pricing
The first thing to consider while setting your price is the needs and desires of your target industry — you must build your pricing strategy based on the needs of your prospective buyers. You can do so by conducting customer surveys and market research. Researching the market will help refine your service offering while providing an initial basis for setting the costs. Have an estimate of the cost of goods or services and develop a model that meets those costs.
You can further refine this model by testing it in the market on an ongoing basis. Later, you should validate your model based on these tests in different markets and vary the prices until you figure out what works for you.
5. Market to Customers
Once you have the service delivery model in place, it’s time to get the right clients. First, determine who needs your services and would be willing to pay for them. Identify the industries already using managed services. Next, figure out the channels through which the businesses in that industry seek information (e.g., trade publications, trade shows, online blogs). All you need to do then is market your services to them directly using the right channels.
6. Establish a Delivery Method
Once you’ve established a sales pipeline, you need to deliver your managed services in a way that gives the customer the outcome they expect. To do so, standardize and automate your process. In the end, your most important metric is customer satisfaction. So take every measure to make communication and service delivery hassle-free for the customer.
7. Scale Your Business
The common factors among MSPs who’ve found success over their competitors and scaled are empathy, growth, and the value delivered. Find a balance between being an affordable provider and a high-quality one. Start by analyzing your company’s strengths and weaknesses compared to the market, then adopt any practices you believe are helping them to succeed. Raise your prices every so often, and continue focusing heavily on customer onboarding and retention.
8. Add New Services
Bundling and white labeling your managed services makes them more efficient for the client. Try to cover all key areas and leave zero service gaps so you don’t leave room for a competitor to enter the picture. Keep adding the right services to create a comprehensive bundle that caters to your target market. You can build managed services offerings by working in the vicinity of your current offerings and adding ones that complement each other.
To build a successful MSP business, it’s essential that you plan your services carefully, stay agile, and deliver exceptional service. By staying attuned to evolving needs, adapting to new technologies, and continually innovating, you can create a thriving and profitable business that meets the needs of your clients.
Top 5 Tips for Choosing the Right Managed Services Offering
When you’re deciding on initial or additional offerings, while the general idea is to add services that complement each other to form a package, you can take this a step further. Best practices include specializing in a particular niche, standardizing your offerings, and upselling your packages to existing customers who are using your services already. Also identify and market your USP and appropriately position yourself in the market. We’ll explain each in depth below.
Specialize in a Niche
It might seem lucrative to have a large set of offerings catering to every need out there, but a more thoughtful way to set up your managed services offering is to position yourself as an expert in a particular service in a specific industry. You might offer other services to complement your core competencies, but have authority in at least one area. While it might seem like you’re missing out on business, it will ultimately help you find the right customers and keep them.
Standardize Your Services
Standardizing your service offerings into bundles can increase simplicity and improve your performance. By bundling, you make it easier for a customer to select from packages of definitive offerings that are executed systematically as opposed to the tier system. Bundles will also save you time since you won’t have to create a tailored offering for every lead who’s interested in working with you.
Upsell Your Clients
When you’re offering core services like remote monitoring and business continuity, you can start upselling your customers by pushing them into a higher tier or by adding a la carte services to their current bundle. Some examples of high-value services to upsell or cross-sell include desktop as a service (DaaS), unified communications (UC), and mobile device management (MDM).
Identify Your USP
As the market gets crowded by MSPs, you need to figure out your differentiators and tell your target market through appropriate channels why you hold expertise in their area. Identify or create a way that makes you different from your competitors. For example, maybe your prices are lower, your bundles are more comprehensive, or your staff is highly experienced and receives continuous training.
Study the Target Market
You can develop more insight into what services you might offer by researching your target market. Go online and look for what your buyers are expecting to see in an MSP’s offerings. This could be services or other things like the speed of delivery or on-site support. Create an ideal customer profile and build buyer personas to identify their problems. It’s better to solve one problem end-to-end than to have a plethora of unrelated services.
Bottom Line: Managed Services Offering
There are more expectations from MSPs than ever before. Customers want everything in one solution, leaving no option for MSPs but to innovate and build comprehensive managed service offerings. With the world of managed services evolving rapidly, you must maintain focus as you explore new offerings. While the essential offerings must be present, also identify a niche that will help you establish a service, then upsell in order to scale.