Magazine Article | October 13, 2015

4 Benefits You Are Missing By Not Using A PSA

By The Business Solutions Network

If you’re looking to boost productivity, profitability, and customer experience a professional services automation (PSA) tool is a must-have.

Getting a group of MSPs (managed services providers) to agree on best business practices is akin to getting Donald Trump and Hillary Clinton to agree on political views — it’s just not going to happen. Some MSPs, for example, believe strongly in longterm contracts whereas others will adamantly defend month-to-month contracts. Furthermore, some MSPs give customers lots of leeway with regard to choosing specific hardware and software solutions whereas others take a firm stance by restricting customers’ choices.

If there is one common ground among all the MSPs I’ve spoken with over the past year, however, it’s this: If you’re serious about growing your business, a PSA investment is a non-negotiable. I recently spoke with four industry experts about the specific value PSAs bring to MSPs. Before you continue one more day down the path of managing your business via spreadsheets and sticky notes, hear them out. And listen to the nuggets from successful MSPs I’ve talked to this year as well.

Benefit #1: Improved SLAs (Service Level Agreements)
The primary reason customers pay a monthly fee to an MSP is that they want assurance their computers and IT infrastructures are being monitored 24/7 and any downtime will be minimized. That is also why SLAs are so important. They spell out exactly how you’re going to keep your customer up and running and how quickly you’ll get them back up and running if something goes wrong. Want to do a better job at keeping those promises? You need a PSA, says April Taylor, senior product manager at ConnectWise. “Documentation of issues and the ability to escalate problems efficiently means better service delivery and happier clients,” she says. “Automation will always improve SLAs.”

But even if you don’t want to take Taylor’s word for it, it’s hard to ignore Gregory Zolkos’, CEO of Atlas Professional Services (see “Confessions of a Managed Services Convert,” July 2015 issue) advice. “One of the biggest culprits of missed SLAs and inconsistent customer service can be traced back to a spreadsheet and sticky notes,” he says. “Once your business grows beyond five or six customers, it’s just too difficult to rely on manual systems to track and prioritize customer problems.”Subscribe to Business Solutions magazine

Benefit #2: Reduced Errors, Efficiency Gains
Even if missed SLAs aren’t an issue for your business, there are additional reasons to consider a PSA. “IT providers and MSPs are in a constant battle over increased demands placed on their time in today’s fast-paced business world,” says Mike Salem, CEO of Vorex. “They’re faced with the responsibility of trying to manage technical teams, interface with clients, and expand their businesses by bringing on new clients and handling day-to-day operations. PSA solutions can help MSPs and VARs automate many of their day-to-day operations, keep track of service desk and ticketing, and provide an improved high-level view of the business as a whole.”

James Kernan, vice president of Tigerpaw Software, concurs and adds, “As its name implies, one of the main benefits of PSA software is the automation of many repetitive tasks that otherwise would need to be handled by a person. Among the actions that Tigerpaw Software can automate, for example, are the scheduling of tasks, tracking of time, aggregation of billing materials, processing and triaging of service tickets, and internal and external communications.”

A related benefit of PSA software is improved operational efficiencies achieved by everyone in the organization working in the same application. “Because all company data is entered into a single application — sales, marketing, service, finance, account management, inventory, correspondence, and notes — nothing falls through the cracks, and vital information is always readily available without having to waste time hunting around for it,” says Kernan.

“Documentation of issues and the ability to escalate problems efficiently means better service delivery and happier clients.”

April Taylor, senior product manager, ConnectWise

According to Salem, VARs and MSPs can turn to other tools, but in most cases they don’t offer the same benefits as a PSA platform. “For example, other tools might only provide the basics, such as time and expense tracking, while a full-featured PSA solution like Vorex offers advanced HR functionality, enterprise resource planning, and integrated invoicing that can accommodate multiple languages and currencies.”

Benefit #3: Increased Profit Margins
Most IT solutions providers understand, too, that while revenue growth is important, profitability is a much more important metric. “One of our customers had been servicing his largest client for years before implementing a PSA solution,” says Kernan. “He had been running his business with separate applications for billing, service desk, and support operations, and he was not able to accurately track service techs’ time. The company was on a large fixed-fee retainer with one of its customers, so the owner thought he was making a lot of money on the client. However, after implementing a PSA tool and capturing all of the time that his employees were dedicating to this client, the business owner realized he was actually losing money every month.” Using the PSA solution, the business owner was able to pinpoint the problem and realign his project management team. “Additionally, when the contract came up for renewal, the business owner was able to renegotiate the contract and further improved his profitability,” adds Kernan.

Benefit #4: Better Business Performance Visibility
Making smart business decisions is impossible without knowing factors such as labor costs and other important metrics. “Today, companies who support or maintain large sets of geographically dispersed technology and environments have a number of options available to them for obtaining variable field service labor,” says Mynul Khan, CEO of Field Nation. “One of these options is the implementation of a master service agreement [MSA] with one or more companies. Under this scenario, a VAR/MSP contracts with one or more field service organizations [FSOs] to provide on-site service as needed through the MSA. This usually requires the VAR/MSP to hand off all on-site service requests to the FSO who is responsible for managing their own workforce. Not only is this expensive, but the FSO may not be able to provide full visibility, accountability, and control into the service delivery process. Basically, the VAR/ MSP is alerted when a call is dispatched and completed — not to the steps that occur in between.”

Khan says that using a PSA/FMS (freelancer management system) is the first step in gaining this important visibility. “PSA/ FMS platforms offer a complete, cloudbased ecosystem for VARs/MSPs,” he says. “The real value comes from combining outsourced labor expertise and vendor management with project and program definitions, dispatching, project and labor management, invoicing, and tax and business process reporting.”

Tigerpaw’s Kernan concurs and adds, “Business visibility and business intelligence go hand in hand. With all company data flowing into the system, including work times, labor costs, and billing data, business managers can see the true cost of projects and service delivery, better understand employee and resource utilization, and see the key performance indicators [KPIs] of each department.”

Pete Peterson, VP of sales at Internet & Telephone (see “3 Pillars Of Managed Services Success,” May 2015 issue), describes how his company changed after adopting a PSA solution. “A couple of the KPIs we are now able to focus on are the average response time per ticket and the number of tickets responded to per month per technician,” he says. “Obtaining this information, comparing it against our peers’ performance metrics, and making ourselves accountable to improving areas of weakness is where real business growth takes place.”