Driving Growth for Your MSP – Setting Metrics and KPIs

By MAXfocus Guest Blog 1

Ask any MSP of any size what their main business goal is and chances are they will tell you “I want to grow my business” and of course this makes perfect sense. Who wouldn’t want to take their already successful business and make it even more successful?!

But what if you asked the majority of MSPs how they intend to grow their business? How many do you think would have the answer? Some may well have an idea in their heads of what this growth might look like, for some it may be taking on more technicians, to others it could be increased revenue but to many how exactly they are going to grow may not be so clear.

GFI MAX are currently running a survey with MSPs to answer these exact questions – if you’d like to get involved in this quick survey and find out the results then fill out the survey here.

If you are an MSP hoping to grow your business then it is important to set yourself some defined parameters of what this growth will look like, this will not only make it easier to manage this growth but will also make it easier to gauge just how successful you are.

In order to define how you want to grow your business you first need to determine how your business is currently performing, this will give you an insight into where you can go from here and enable you to set goals accordingly.

Setting your KPIs

To start with you will need to identify key areas of the business which are important to you and will continue to be as you grow; these will be your Key Performance Indicators (KPIs). Within these areas you will then need to consider the parameters by which you will determine success. Now you have the metrics to measure in order to determine not just your current performance but your ongoing success as you set yourself goals for growth.

What these KPIs and metrics should be will obviously differ from business to business, however in a recent interview with Richard Tubb, Eric Dosal of Brightgauge pinpointed three areas MSPs could consider when setting metrics and KPIs. These areas were service delivery, sales/marketing and finance and are a great starting point for any MSP when setting metrics and KPIs for their business.

Service delivery

As managed service providers, service delivery must be a major focus for the success of your business – if you are not providing a good service you are not doing your job! But there are many different ways you can analyze the service you are providing and this is where you need to decide what is important to you.

In February of this year Decision Tree conducted survey of IT Service providers on behalf of Autotask and it was found in that survey that 85 percent of IT service providers rank customer satisfaction as a high-priority when considering the performance of their business.

Analyzing customer satisfaction can reveal a lot about how successful your MSP actually is at delivering your service. With customer feedback you can pinpoint whether there are any areas of concern, if you are meeting your SLAs and how quickly you are resolving issues among other things. When it comes to service delivery customer satisfaction is vital! At the end of the day you can’t grow your business if you’re unable deliver a service which makes your customers happy. Particularly when you consider the importance of customer referrals for finding new business as we have discussed in an earlier article.

Another area of service delivery worth considering in terms of growth potential is efficiency.  In the same survey by Autotask it was found that 60 percent of IT service providers are losing 20 hours or more per month on various tasks including entering data into multiple systems. It is simply not economical to scale a business which is losing this amount of time.  This highlights the importance of integrated systems and managed processes – with tools such as GFI MAX RemoteManagement (which also integrates seamlessly with Autotask) you can save hours of time – to the point where you can scale your business without needing to take on extra technicians.

By analyzing service delivery data you can identify areas where you are wasting time and put actions into place to improve the efficiency of your service. It could be that using an effective RemoteManagement tool would save you time and enable you to effectively manage your service as you take on more clients.

Sales & Marketing

If your goals for growth do include taking on a number of new clients or increasing your revenue, it is easy to see why sales and marketing would be another area highlighted as an important factor for setting KPIs.

If you understand your current revenue and where it is coming from, you will be able to get a clear idea of where you should be focusing your sales and marketing efforts. For example, if your revenue comes mostly from PPC campaigns you may want to set your KPIs to include cost per action. Here you would analyze how much it costs to achieve one sale through your current PPC activity and your goal would be to decrease this CPA.

The new MAX IQ blog from GFI MAX will be live soon, covering many topics including PPC advertising to help you with sales and marketing for your MSP. If you would like tips and advice to help you market your MSP business join us when MAX IQ launches in June.

Finance

Ultimately what any MSP is trying to do while growing their business is to be profitable. For this reason profitability needs to be the underlying metric for all your KPIs. It’s no good focusing on how to make your service more efficient if it isn’t helping you make more money. Similarly if you need to drop your prices to keep your customers satisfied, you don’t want to do so to the extent that you are no longer profiting from their custom.

At the end of the day you need to be analyzing the metrics that are important for your business and these may well change as an when your business grows. Don’t let yourself get overwhelmed by how much there is to consider. Start simple and begin analyzing the data that YOU think is relevant, you can’t get this part wrong!  Even analyzing an area that you think is important only to find that it’s not will still help you learn something about your business. 

This guest blog is sponsored by GFI MAX. Monthly guest blogs, such as this one, are part of a platinum sponsorship at MSPmentor.