If you're contemplating a transition from VAR to MSP, here are five things you need to do.

Channel Partners

January 20, 2014

4 Min Read
5 Must-Do's in Transitioning From VAR to MSP

By Douglas R. Grabowski Jr.

There’s been a fundamental shift in how clients view technology. Gone are the days when computers were a “nice-to-have.” Whether they like it or not, clients’ businesses have transformed to become highly dependent on technology, whether it’s their scheduling, their inventory, their finances or even their email. As a result, there has to be a corresponding fundamental shift in how you provide stellar services to your clients. If you’re contemplating a change from being a VAR to becoming an MSP, here are five things you need to do as part of your transition.

First, change your mindset. A client wants to know you have their best interests in mind. Returning again and again to fix the same problem by the hour only benefits you, as they still have the problem. Likewise, they don’t choose when a problem pops up and should not be penalized for it. Clients like to know that they will remain operational at all times. If you have “normal” rates and “emergency” rates, the best thing you can do is forget they ever existed. You’re now assuming a large portion of their technical risk by being a flat-monthly-fee provider. Act that way! Charge a solid rate per user (or machine) and execute. You’re aligning their goals with yours if they’re in trouble, you’re in it with them. If they’re going well, you’re going well. By assuming a large portion of their risk, you can not only charge more (and get a recurring revenue stream), but your client gets the No. 1 benefit of solid, stable systems.

Second, change your clients’ mindset. Clients will think that an MSP is inherently more expensive. In fact, the opposite is true. Because you’re removing issues in their environment once and for all and sharing risk if new ones pop up, you are actually going to be cheaper over the duration of the contract. (You do use contracts, right?) Initially you might have more costs toward stabilization, but longer term you won’t have to do as much work in the environment, so it’s cheaper in the long run. Clients will want to know that it will actually cost them less long term, which it will. So be sure to educate them as well as yourself as to how you’re going to be able to provide better services, less expensively and more efficiently.

Third, improve your service level. Break/fix environments are inherently unstable and most definitely will be if you’re taking over one that has been poorly run. Take the time to solidify these environments at the beginning of the engagement, so you have more time/resources to add value and strategic capabilities over the duration. This way, you’re not eating up time, resources and money in fixing the same things every month. Fix it once and move on.

Fourth, communicate! Clients want to know that they are protected. Done right, an MSP should be transparent as far as what’s going on in the environment, and virtually invisible day-to-day. Your goal is to over-communicate with your clients. For example, “We proactively patched your 10 systems and prevented viruses spam from invading your network.”

Finally, automate everything. With increased service levels and responsiveness to your clients (after all, you’re now solving all issues first-call and ensuring they don’t happen again), you need to spend less time on those items that require repetitive tasks. Invest in a remote management and monitoring solution (Continuum, Level Platforms, GFI and others) and leverage their automation capabilities for patch management, security updates (use services that whitelist updates so that Patch Tuesday doesn’t become Wacky Wednesday morning with no one working) and third-party applications (Apple, Adobe, Google, etc.). This way you’re not running machine-to-machine to run updates and patches. Review your current tickets and see which issues crop up repeatedly. Figure out the root cause and ensure it gets fixed once and for all. And automate your billing and financial items. Leverage memorized transactions in QuickBooks and Peachtree. You’ll thank yourself later.

Douglas R. Grabowski Jr. is managing partner of Grabowski Group Inc., a strategic technology advisory firm with offices in New York City, Connecticut and Florida, that develops and delivers services to improve the way businesses use technology to achieve strategic, operational and financial goals. He can be reached at mailto:[email protected].

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