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October 15, 2021
By Nick Heddy
Digital transformation happens when a company adopts and implements digital technology to improve operations and processes, an essential move to grow and scale effectively. Companies can further enhance their business by adopting cloud technology that offers additional features and benefits. The advanced automation capabilities of cloud technology will reduce operation time and remove human touchpoints, resulting in increased productivity, efficiency and security.
According to a recent Forrester report, “Cloud Computing Predictions 2021,” a top priority for businesses post-pandemic is improving the use of data insights in decision-making. Cloud technology allows companies to capture, track and store various data types to better understand their customers’ demographics and buying behaviors. This insight enables them to become more strategic in their operations, product development, marketing, and sales initiatives.
Cloud technology is also a proven solution that enables employees to work from anywhere, empowering companies to be agile and nimble in the new hybrid workplace.
While the pandemic accelerated the digital transformation for many companies, a significant number still haven’t migrated to the cloud. We’ve seen a couple barriers to entry, including security concerns, proper equipment and associated costs. However, the main reason is many companies lack the IT support to complete the project and manage the ongoing infrastructure, which creates an excellent opportunity for managed service providers (MSPs). The subscription-based sales model of cloud technology also makes a fantastic recurring revenue stream with additional income from associated services.
MSPs can deliver digital transformation to their clients and gain new profit in the following four ways and grow their cloud practice.
Establish the modern workplace. Through cloud technology, MSPs can establish and secure their clients’ modern workplaces with solutions that provide advanced automation, communication and collaboration capabilities and enhanced security features. The ability for employees to safely work from anywhere on any device allows the company to be adaptable to the changing workplace. The automation that cloud technology provides streamlines processes, increasing efficiency, productivity and revenue.
And according to Forbes, with cloud technology, ongoing IT support is reduced by 55% and ROI is 4.01 times greater than on-premise technology. Additionally, cloud technology deploys quickly, is easily configured and is simple to manage, making the solutions desirable for MSPs.
Cloud technology also significantly increases clients’ security postures. Its automation removes manual touch points and reduces the chance of human error, and large data centers monitor and protect data from sophisticated threats through enhanced safeguards. Utilizing data centers instead of on-premise servers further protects a company from data loss in a natural disaster. And unlike on-premise technology, when vendors release software patches through the cloud, they’re automatically pushed to all users, ensuring they have the most recent fixes.
Utilize the Microsoft cloud platforms. Microsoft’s cloud platforms provide an excellent option for MSPs new to the technology to begin building a practice. The Microsoft cloud ecosystem is the most mature in the industry and offers significant opportunities to expand your business and increase revenue. It provides MSPs the advanced technologies to enable their clients with powerful business solutions. The Modern Workplace suite includes productivity tools to collaborate and communicate anywhere in a secure and virtual environment. Azure offers users the ability to use their frameworks, infrastructure and data center to build and deploy their applications. And with Dynamics, users have a portfolio of business solutions to achieve operational excellence and develop a tremendous customer experience.
Microsoft prefers MSPs to access its cloud solutions through the CSP program and built it specifically to enable its cloud business. Through the program, MSPs purchase licenses through a CSP distributor and gain access to marketing materials, training and user guides to accelerate their cloud practice. They can also earn incentives and rebates based on …
… certain products, creating an additional revenue stream. Most vendors understand the value of Microsoft’s robust cloud ecosystem and build solutions that integrate with and enhance the products. MSPs can build an effective practice, experience steady growth and create substantial income using the Microsoft cloud platforms.
Build and leverage a strategic distributor partnership. Leveraging a partner who offers best-in-class technology and a marketplace can accelerate an MSP’s growth and success. The sell-through model of cloud licenses is mutually beneficial to the MSP and the distributor. Each time an MSP migrates a new client, adds a new tenant and increases usage, it increases the recurring revenue of both parties. MSPs should seek a partner in the IT channel ecosystem that understands their value and develops programs and initiatives to help grow their business. Combined efforts and strategic go-to-market plans focused on increasing their clients’ cloud adoption, and usage will significantly impact the MSP’s success.
Access to top-tier service and support is critical to providing clients a superior experience. Technical issues happen and can arise at any time of the day. Choosing a distribution partner that offers continuous support and remediates most service tickets in-house reduces the time it will take to correct your clients’ issues and increases your value. It’s also imperative that the partner offers guidance and education on building a solution stack, deploying the technology, and enabling correct capabilities. Comprehensive cloud solutions comprise several features and options to address many scenarios. It is crucial to establish the appropriate settings for each client, and the right partner will provide the support to do so.
Become the architect. Clients typically recruit MSPs to support them in one of two ways — either to complete a job they could do themselves but lack the time, or to oversee a larger project that already has been determined and scoped out. The first example resembles a handyman where the skills gap between the MSP and the client is minimal. In the second scenario, the MSP is a builder, where the project requires more skill, but the MSP is still following someone else’s plan. While these business models are adequate and provide a revenue stream, MSPs should focus on becoming the architect to grow their business and provide clients added value. As the architect and trusted business adviser, the MSP owns the planning and execution of the client’s complete technology strategy, improving operations and processes in all aspects of the business.
As companies continue migrating to the cloud, associated services and IT support rise. By creating a comprehensive solution offering that includes these services, MSPs provide clients a more consultative approach to technology and increase their value and importance. Shifting to this business model allows the MSP to highlight their knowledge and expertise to become a trusted adviser in the client’s key business initiatives. The MSP will become the architect through their increased value and impactful strategies, guiding the client’s technology decisions and digital evolution.
While the last 18 months have seen a rise in cloud technology adoption, there are still several ways MSPs can take advantage of the digital revolution. Whether they establish clients’ modern workplaces or provide expertise in their key strategies, each stage of the journey offers MSPs a unique approach to provide value to their clients. Cloud technology enabled thousands of companies to sustain themselves throughout the pandemic, and it will drive their success as we pivot into the new hybrid model. With 36.2 million Americans expected to be working from home by 2025, digital transformation will be a top priority of businesses for the foreseeable future. By following these four approaches, MSPs can deliver the digital transformation to their clients and capitalize on the massive opportunity.
Nick Heddy, chief revenue officer at Pax8, has more than 16 years of experience in indirect sales in industries such as technology and telecommunications. Heddy is responsible for revenue generation processes and ensuring key departments are aligned to create the best experience for partners. He previously held the role of SVP of sales and marketing at Pax8. He received the Circle of Excellence Award from CompTIA in 2018, and has been a speaker at the Channel Partners Conference & Expo, and more. He holds a bachelor’s degree in entrepreneuring from Central Michigan University and an MBA from the University of Colorado Business School. You may follow him on LinkedIn or @pax8 on Twitter.
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