Guest Column | March 24, 2020

The State Of MSPs: A Small And Large Snapshot

By Kahlil Crawford, MBA, Trusted Tech Team

Sales business meeting

Trusted Tech Team recently conducted a survey of MSPs to identify the current state of managed services and its future trends. Respondents included full-service MSPs, systems integrators, independent software vendors, value-added resellers (VARs), and value-added dealers (VADs).

Microservice And Maturity Models

With the emergence of intelligent enterprise, MSP revenue generation is trending upward. (Micro)service expansion and consumer growth is a high priority amongst all MSPs. Smaller MSPs tend to focus on customer base growth, while large MSPs tend to hone in on customer experience and innovation development. Other top priorities for both include client education on new products and solutions, strategic growth development, and streamlining centralized management tools.

Maturity determines the long-term quality of MSPs self-improvement. An MSP maturity model exhibits the capability of an organization to perpetuate that improvement. Otherwise known as continuous improvement (CI), it exists in two forms:

  • Incremental continuous improvement tweaks MSP businesses practices, processes, and methodologies as problems are detected. It is more cost efficient and quicker than breakthrough continuous improvement with reduced risks and liabilities for MSPs
  • Breakthrough continuous improvement transforms MSP business practices, processes, and methodologies by operational review. It is less cost-effective and slower than incremental continuous improvement yet provides MSPs larger revisions for accuracy and relevance.

Influential Spheres And Selections

MSPs enjoy a high success rate when transitioning clients from older to newer products. Smaller MSPs earn customer trust due to their advanced expertise and extensive product experience; whereas large MSPs simply cater to customer preferences.

Small and large MSPs rely on vendor partners to provide quality assistance with the following:

  • Quality support - experienced staff and 24/7 accessibility, and consistent follow-up and follow-through
  • Price and value - competitive rates, premium features, and transparent price modeling transparency
  • Product versatility - microservices availability, diverse consumer options, scaling solution flexibility
  • Reliability - quick and reputable, on-premises deliverance, and performative expedience

Office 365 Business And Purchasing Approach

Most MSPs have enabled Office 365 deployment for their customers or expect to do so within the next 3 years. This success rate is due to 365's higher value versus previous versions (Office 2007, 2010, 2013) and compatibility with Windows 10. MSP setup and deployment efficiency combined with quality training resource provision further contribute to their customer success.

Forty-five percent of MSPs purchase Office 365 from value-added resellers (VARs), like Trusted Tech Team, or other non-Microsoft channels. Those MSPs find the quality and efficiency of VAR support services and products as an advantage over Microsoft. Also, they are more likely to work with VARs that offer competitive pricing with improved margins.

Fifty percent of MSPs expect a portal for centralized management of customer subscriptions, and a proactive escalation of product issues to Microsoft support. In addition, MSPs tend to prefer receiving technical support without having to first meet a sales minimum.

MSP Future Emergence

How can emerging technologies support MSPs as they adapt and expand their services and products?

Historically, MSPs have integrated manufacturing and product resources for customizable solutions. As reliance and demand for technology increases, MSPs must diversify their product and service portfolio to increase brand value, awareness, cost-effectiveness, and revenue generation. With the prominence of software as a service (SaaS), companies are increasingly transitioning operations from on-premise to on-demand solutions (subscription over ownership) en masse; as the following emerging technologies continue to advance intelligent transformation.

  • Blockchain/DLT - VARs that offer distributed ledger technologies (DLTs) can empower MSPs to provide blockchain as a service (BaaS), which can serve as an effective means to manage data (storage), contracts, transactions, notifications, and application life cycles.
  • Artificial Intelligence (AI)- MSPs also can benefit from the use of artificial intelligence [AI] (primarily chatbots), which helps reduce labor costs, improve speed and efficiency, and increase customer volume.

Together, MSPs, VARs, and other service providers have a very unique role to play in the rise of intelligent enterprise. Contemporary technological advancements enable resellers to offer emerging technologies as a service. Therefore, it is increasingly important for VARs and MSPs to grow their expertise and offerings to help generate profit and build productive relationships with their clients.

About The Author

Kahlil Crawford, MBA, is Senior Content Engineer at Trusted Tech Team.