Is There a Future for the Amateur MSP?
During the early years of managed services, many VARs and break/fix companies went through a necessary decision-making process on whether to leave their current business models and become MSPs. The decision to become an MSP was not an all or nothing proposition, but it was a business decision that had to be made.
Today, there still are break/fix and VAR providers deciding to become managed service providers. The critical question to ask is, in 2020, is what type of MSP you will be…an amateur or a professional?
What is the Amateur MSP?
I will state this upfront; there are some exceptions to this definition. But the general principles of the definition exist in the majority of MSP scenarios.
The amateur MSP is an organization (or department) where the practice of managed services is not the focal point for decision making related to sales, marketing, and delivery of IT management solutions. If some of you are scratching your heads, allow me to explain further.
There are many organizations operating today where the managed services team, department, or group, is secondary to how the company as a whole operates. One of the exceptions mentioned above to this rule would be large enterprise solution providers who offer clients many things, including managed services. Microsoft and Amazon would be prime examples (to the extreme) of companies providing managed services, but their core business model is not IT management.
For mid-market and SMB solution providers, the rule becomes more readily identifiable. For these types of companies, providing projects, reselling hardware and software, and delivering other products, managed services can either be the focal point of the company’s delivery model or an afterthought. To be ultra-clear, you don’t have to be generating 100% of your revenues from managed services to be a professional. The more significant point is your approach to managing IT for your clients must come first. The MSP that puts their clients’ IT management first is the professional.
Managed Services Demands Focus
People may wonder where the term managed services practice came. Managed services practice was first used by the MSPAlliance over 15 years ago when we introduced managed services as a profession. MSPs are always honing their skills, striving to become more efficient, and expanding their knowledge, both as individuals and organizations.
The practice of managed services demands focus and constant attention. Providers only passively interested in delivering managed services cannot apply the attention needed to achieve the operational status required of today’s MSPs.
Organizations that are primarily led by hardware sales teams are a prime example of a company led not by IT management but by the whims of the sales team bringing contracts for the MSP division to fulfill.
The same is true for break/fix providers. When your relationship with the client is based on responding to broken things, you are not managing IT; you are reacting to it. While your company may have an RMM, ticketing solution, and may even bill monthly, these things do not make you an MSP if all you do is react to the problems. Responding to IT problems is what we mean when describing an amateur MSP. Today, MSPs must adapt to the changing regulations, laws, and expectations of their clients, which is moving away from amateur behavior towards professionalism.
How to Fix the Amateur MSP
The first step is acknowledging the situation and understanding what the current market is demanding. All the data privacy rules, data breach notification requirements, and even the most current MSP registration laws point towards professional-grade managed services and away from the amateur MSP. These laws and regulations are focused on the proactive MSP. Meaning, the reactive amateur MSP model is inconsistent with the current trend of laws and regulations.
Once you have acknowledged the problem, begin with a top-down review of how your company approaches managed services delivery. If you cannot get your leadership team on board, any significant change will be difficult.
Next, you must realize that becoming a professional MSP does not mean you have to receive all of your revenue from managed services. Instead, it means your managed services delivery is the centerpiece of your company, even when selling projects, hardware, and software.