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4 Threats to an MSPs Business and How to Overcome Them

Ray VrabelBy Raymond Vrabel

In my last blog, I discussed why collaborating with other MSPs can make sense for business expansion. This month, I focus on strategies to overcome some of the biggest threats to your business. Working on just one of these at a time throughout the year will continually allow you to stay current and ahead of your competitors.  

1. Adapting (and not changing) an “old school” way of thinking. If you work to overcome just one threat, I would suggest shifting your thought process in approaching the needs of your SMB customers. Our industry changes on a monthly, even sometimes weekly, basis and with that, you must keep current for your business as well as your clients. Now is not the time to be set in your ways, not open to change. I have had conversations with (now) MSPs who thought they could make their margins as just “the phone guy.” This might have been the case 10 years ago, but with managed services gaining ground and customers wanting the full services gamut, this thought process is becoming less relevant, especially with the advent of BYOD and MDM.

In fact, earlier this year, Ernst & Young published the report, “Top 10 Risks in Telecommunications 2014.” One area discusses strategic threats specifically relating to customers, competitors and investors. Two of those key threats are:

  • Failure to understand what customers value; and
  • Failure to adopt new routes to innovation.

These observations further prove that MSPs need to be open to making proactive updates to their business models, especially as their customers’ needs continue to evolve and change with the times.

2. Underestimating telecommunications carriers. Never underestimate the power of the telco carrier. Many offer services for SMBs that go beyond landline phones; telcos also are keenly aware of the opportunity in managed services and realize that the advent of managed services has brought about greater competition. This, coupled with many carriers now beginning to offer cloud-based services, creates more competition for MSPs.

Still, several carriers are moving away from a direct model for SMB services and are recruiting MSPs to provide services via their product package. If you are not offering services, this is a great way to start. Reach out to the carriers that you have relationships with and see if they offer any partner programs that would allow you to easily offer a services package for your clients.

3. Increasing popularity of BYOD. Gone are the days when every authorized employee was issued the same smartphone by the IT department. Now, because of MDM, most SMBs are allowing employees to use their own smartphones, tablets and laptops. While this can sometimes get dicey – because the employee has personal items on a device used for business, and vice-versa – BYOD’s increasing popularity is forcing SMBs to look at MDM solutions. This is especially critical for compliance-heavy verticals like retail, health care and finance. If you have clients in these verticals, helping them set up BYOD policies should be part of your service offering, especially in the age of cyber-attacks and hackers. Furthermore, with an MDM solution in place, you offer your business and clients an added layer of protection and peace of mind, not to mention another revenue-generator to your line card.

4. Not upgrading technical infrastructure. With standard phone systems easier for the client to administer and manage themselves, this is another tactic that I would prioritize at the top of my list. The days of managing large PBX and wall-to-wall wires are becoming obsolete and it’s easier to get into telco support. Systems are smarter and cloud-based, which means easier maintenance – another reason to get into managed services now. Think about what you are offering and how you can upgrade those services. Maybe it means refreshing what you have or updating your services packages? Or, it could mean providing different tiers of service levels based upon individual customer needs.

Another consideration is that platforms such as Skype and other video chat features are becoming more accessible. SMBs want their solution providers to get creative and offer them additional, upgraded services. This is especially important as this type of technology gains popularity and is virtually offered at a low (or no) cost.

Implementing just one of these four tactics to overcome today’s challenges will help you get ahead of your competition. But, as the industry continues to change and evolve, it’s imperative to know your customers and their values so you can be there to service their needs into the future.

Raymond Vrabel is Continuum‘s Director of Technical Account Management and participates in product and service growth initiatives. He manages Continuum’s Technical Account Management team which supports over 3,500 partners worldwide. Vrabel has more than 15 years of experience in the IT industry, specializing in managed IT services, disaster recovery and cloud solutions. Follow him on Twitter: @rayvrabel.


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