Most MSPs struggle to build $5 million businesses. In stark contrast, Ed Nalbandian built a $30 million managed services business, sold it to Cognizant Technology Solutions (the big IT application consulting firm) and ultimately moved onto a new opportunity. Nalbandian's destination: Avaya, where he's VP of operations services -- a fancy term for managed services. Instead of focusing on the SMB market, Nalbandian is marching into the enterprise. Who is Nalbandian -- and why is he obsessed with enterprise managed services? Here are the answers.
Nalbandian is a long-time veteran of the MSP market. He started selling managed services for IBM in 1982 - yes, 30 years ago -- then he drove AT&T's managed services efforts during the age of Frame Relay. By 2000, Nalbandian launched his own MSP -- AimNet Solutions Inc., which grew to about $30 million in revenues and more than 100 employees within six years.
"Everyone thinks it's the easiest thing in the world to start an MSP," said Nalbandian. "Actually, it really is easy to launch such a company. But making it successful? Now that's one of the most difficult things you can do."
Apparently, Nalbandian succeeded. Cognizant snapped up AimNet in 2006, and Nalbandian stuck around through 2008 or so to make sure the business performed well. Fast forward to the present, and Nalbandian is trying to capture lightning in a bottle again -- this time driving Avaya's enterprise managed services push.
Avaya Enterprise Managed Services: The StrategyNalbandian explained the nuts-and-bolts of Avaya's enterprise managed services strategy in February 2012. The services, known as Avaya Communications Outsourcing Solutions, basically boils down to these points:
- It's designed for large enterprises with aging IT, particularly aging communications equipment.
- Some enterprises with aging IT want everything upgraded and managed for an ongoing monthly fee.
- Other enterprises with aging IT want to stick with their existing infrastructure but still need it managed.
To meet that demand, Avaya launched Matrix, a cloud-based managed services platform that cost $15 million to build.
Where Partners Fit InOn the one hand, Avaya is selling its managed services directly into enterprise accounts. But Avaya partners are empowered to resell those Avaya services as part of their ongoing IT projects with customers. Also, Avaya has a lengthy list of managed services that MSPs can offer into the mid-market.
Still, Nalbandian -- armed with Avaya Communications Outsourcing Solutions -- is focused entirely on the enterprise, where sales cycles can be six months or more, and each managed services win typically includes extensive customization. This isn't the land of SMB managed services. And Nalbandian knows it.