How to Avoid Managed Services Pitfalls

It seems everyone today wants to be a managed services provider. Everyone wants the recurring, predictable revenue and the numerous other benefits that can accompany the managed services business model.

Yet, with all the hype surrounding managed services, the stumbling blocks that have hindered many MSPs in the past remain today.

I thought it might be helpful to touch on a few of these pitfalls and render some advice on how to avoid them.

First, being an MSP is a full-time job and demands a certain amount of planning, preparation, and effort to make it work.

There are many examples of companies who have tried to develop part-time managed services models only to yield less-than-desirable results.

By treating your company’s decision to become an MSP as a business-changing event, you will be taking an important first step toward success.

When making the decision to move ahead, it is important to have the complete backing of company executives.

There are countless examples of companies whose managed services ambitions were hindered by lack of any meaningful support from their senior executives.

The most common occurrence is the mistaken belief that managed services is merely another product line to be added to the company’s long list of offerings.

By trivializing the commitment required to become a profitable MSP, many companies never give themselves the full chance to experience the benefits this business model can afford.

Secondly, buying into a vendor platform does not (by itself) make you an MSP. As I often tell people, buying a pen does not make you a great writer. It is merely a tool to help you accomplish a task.

The same is true with managed services. While it is true that there are many inexpensive, yet powerful, remote monitoring and management platforms in the market today, simply acquiring that technology does not guarantee you will deliver efficient and profitable managed services to your clients.

If you are stuck about which vendor platform to choose, here is some advice: Make sure you have a good idea of the market you currently service (or would like to service; it would help immensely if you had a business plan) as this will greatly determine which vendor platform you should select.

If your clients are predominantly banks or financial institutions, perhaps a platform that has a strong security component would be a wise choice.

In the end, the vendor platform you choose should help you achieve the business plan you have devised for your company; it shouldn’t dictate a business plan to you.

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There are many excellent vendor platforms currently on the market, and there is one out there that is right for your company.

Finally, as with many other professions, peer networking is critical. Almost as important as benefiting from the experience of others, the ability to avoid costly mistakes is another key advantage of speaking with other managed services professionals.

Managed services is not about reciting fancy techno-babble to customers. Managed services is about taking on the responsibility for the health, security and performance of IT networks.

The managed services profession is one that thrives on communication and sharing of experiences.

As a new MSP, you should seek out your colleagues so you can learn from their mistakes, share what has worked for you, and create bonds that will foster greater professionalism, efficiencies, and profitability. This is the pathway to developing best practices.

One of the fundamental differences between true MSPs and the many thousands of companies that remain stuck in the break/fix mold of IT management is that managed services is a profession.

Just like lawyers, doctors, accountants and dentists, MSPs care for their clients on a level that is fundamentally different from simply repairing a broken printer or monitor.

MSPs today deal with regulatory compliance, legal liability, security and other sensitive issues on behalf of their customers.

These issues will only continue to increase and drive more and more consumers to seek out a managed services solution.

Charles Weaver is the co-founder and president of the MSP Alliance, a global trade group for the managed services/IT outsourcing industry with more than 200 corporate members.