The MSP Business Model is Not Dead

Failure to Understand MSP Business

While most MSPs are thriving these days, it is safe to say that the MSP business model has been undergoing a significant change, but only in terms of the technology they have been using, not necessarily the business model itself. I'll try and explain.

The constant evolution of technology is both what makes MSPs so vital in today's world, but it also can cause great challenges to MSPs who refuse to recognize and act upon these changes. For MSPs who see the constant change of technology and use it as a competitive differentiator, but mostly as the bond that strengthens the relationship with the customer, these providers will remain on solid ground. For those MSPs who fail to see new technology for what it is and remain locked in out dated service delivery models, these providers will experience more hardship and challenges.

The distinction between these two types of MSPs should be clear. What should also be clear is that they share the same business model. The chief difference between these two is one MSP acts upon change and the other stagnates.

Don't Believe The Naysayers

In my opinion, MSPs have gone through obvious periods of growth and less growth. I say this because for 20 years our profession hasn't really seen any significant periods of decline, only varying degrees of growth. Today, we are in a period of modest IT spending increase, but a somewhat aggressive growth period of managed services and cloud computing spending (computed as a percentage of overall IT spending). More simply put, managed services spending is growing faster than the rate of general IT spending.

The point of me saying all this is to give comfort to those out there who may be susceptible to those organizations wanting you to believe your profession is dying. It isn't. In fact, it has never been more relevant than today. If you want to see your MSP practice thrive, however, you do need to pay attention to the technology, make sure it is current, and adapt your business plans accordingly. Then, when the next person who tells you MSP is dead, you can laugh and respond.