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SMBs’ Technology Reliance Presents Huge Opportunities for MSPs

After more than a decade of growth, the IT landscape is one of disruption, uncertainty and opportunity.

Kaseya Guest Blogger

November 6, 2020

5 Min Read
SMB
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The 2020 State of IT Operations Survey uncovered a dramatically different scene than previous years. After more than a decade of growth sprouting from the ashes of the 2008 financial crisis, the IT landscape is one of disruption, uncertainty and opportunity.

One thing we’ve learned during 2020 is that SMBs are more reliant than ever on their IT systems to conduct their day-to-day business. In addition, the investments SMBs have made in cloud technologies, remote access and monitoring, and endpoint management are paying dividends they could have never imagined.

While many things ground to a halt, a wide variety of businesses were able to continue operating thanks to IT. Not everything was seamless, and many chinks in the armor were exposed when stress tested in crisis, but overall the results should only prompt further interest and spending on these key technologies in both the short and long term.

We asked both practitioners and leaders in the IT space about what keeps them up at night, where they’re directing spending, and what they view as high priority areas going forward. Below are some top takeaways and what they mean for MSPs.

Remote workers create more openings for bad actors

A distributed workforce has once again highlighted the importance of security, and this is another area where SMBs have been increasingly turning to MSPs for guidance and solutions. Fifty-three percent of respondents cite cybersecurity and data protection as their biggest challenge, and 58% say improving IT security is their top priority. Twelve percent of IT practitioner respondents experienced a data breach this year, while another 17% had one in the past three.

From unpatched remote systems to insecure Wi-Fi connections, remote work creates new challenges while offering the flexibility required to maintain business operations during this crisis. For example, while 77% of SMBs regularly patch their servers and workstations, that drops to 31% for remote, off-network devices. And even those updates aren’t always timely, as only 36% of SMBs were monitoring third-party software and applying patches for critical issues within 30 days.

Given that 28% of IT leaders state that long-term support for a remote work force is a top priority, it’s clear that organizations are realizing not everyone will be back in the office anytime soon.

 Keeping the lights on

Pre-pandemic, no one was a fan of downtime However, with remote work becoming the new normal, service levels are more critical than ever. This topic jumped from 24% in 2019 to 39% in 2020 as a top organizational priority.

This is by far the largest year-over-year increase and illustrates how integral IT has become–and how problematic it can be when it fails. MSPs should look to bolster their solutions for maximum availability and usage while also touting their stellar performance under this increased demand.

The cloud isn’t magic

When businesses migrate key functions to SaaS solutions, there’s often a false assumption that their data is being securely backed up by those providers and can be seamlessly restored if a catastrophic event occurs. But this isn’t always the case beyond 30 days, making it extremely problematic that 60% of SMBs believe Google, Microsoft and Salesforce are automatically doing this as part of their standard package.

This represents both an opportunity for MSPs to offer these backup and recovery services along with the challenge of shattering this misconception and educating clients and prospects on the risks they’re taking by forgoing these services.

An automated future

For MSPs that already have solutions in place for the challenges of today, the next must-have for SMBs is likely to be AI-based solutions. Nearly two-thirds (60%) of SMBs are planning to invest in automation, 32% will invest in data science and analytics, and 24% are going to put money into AI and machine learning.

The non-technical SMBs pursuing these new paths will need plenty of guidance and handholding to create a positive return on investment. Since these are net-new technologies rather than the next generation of a previous solution, MSPs will once again have to educate and steer their clients toward practical and valuable choices.

Shrinking budgets

While investments in IT kept savvy SMBs up and running, they didn’t completely protect them from the major financial losses sustained by many organizations. As revenues slumped and unexpected expenses appeared, the balance sheets for many corporations are looking shaky.

This is creating downward pressure on IT departments who are being asked to cut costs and look for savings opportunities just like their colleagues running other parts of the company. More than one-third (34%) of IT leaders say budget cuts are their biggest challenge this year, making this conundrum both a blessing and a curse for MSPs.

Many respondents reduced IT headcount and are outsourcing more IT services to save money. Some SMBs may offload even more responsibility onto their MSP partners, leading to an increase in MRR. At the same time, companies may cut services deemed non-essential and slim down their headcount, creating fewer endpoints to manage and SaaS seats.

No one knows exactly how it will all shake out, but it’s prudent for MSPs to connect with their customers to take their temperature and see whether there’s opportunity or danger on the horizon. A strong ROI and clear value proposition are more important than ever, as every penny spent will be scrutinized more closely than before.

Adding value at an attractive price point

For MSPs navigating this uncertain landscape, the ability to offer a broad portfolio of outsourced IT services at an affordable price point may be the difference between those that thrive and those that barely survive the lean years ahead. Of course, one way MSPs can lower costs is standardizing on a common platform that allows them to offer a wide range of solutions without increasing headcount, fixed costs or investing in a ton of employee training.

Using a purpose-built platform for MSPs that supports everything their clients might request is a scalable approach to growth. Learn more about the SMB trends MSPs must capitalize on as they approach 2021.

 Jim Lippie is GM & SVP Partner Development, Kaseya.

This guest blog is part of a Channel Futures sponsorship.

 

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