The 2021 MSP Boom: Tips and Pitfalls for “Everything as a Managed Service” [Part 2]
Given the incredible boom that awaits managed services providers (MSPs) in 2021, it makes sense to extend the applicability of opportunities for mutual benefits in the post-COVID-19 period.
In my last blog — Part 1 of this same series — I discussed how 44% of organisations globally plan on increasing their investments in managed services in the next 18 months, creating a bullish market for MSPs. The need for consolidation, more robust security, and lasting change in employee and customer expectations will drive this demand.
To catch up on this story so far, please read my blog titled The 2021 MSP Boom: Gain from it by an “Everything as a Managed Service” Approach [Part 1].
Two significant changes occurred during the pandemic as MSP’s customers need virtually changed overnight, and secondly, transitions performed remotely. Companies that were once hesitant to allow remote working had their hand forced and are now more relaxed about allowing employees to work from home. It also means the network and collaboration need to be more robust. Many businesses have put money in place to keep people connected from home, many of which were short-term solutions that were not suitable for long-term remote working in the ‘new abnormal’. The challenge for MSP is that customers have gotten used to the new standard, which saved many steps of providing physical access to MSP employees, providing buddy to MSP employees to get comfortable with organisation processes, environment, & people etc.
Now let’s get back to the question at hand: How applicable is the managed model, really, to non-IT verticals? What are some of the best practices and pitfalls to remember as you move forward?
Managed Services ≠ Managed IT Services
Even traditional MSPs can no longer stay limited to staid IT services delivery comprising network maintenance, issue handling/resolution, and cost reduction. As enterprises embark on increasingly sophisticated digital projects involving the Internet of Things (IoT), advanced security infrastructure like SASE, unified communications, or, at the very least, a cloud-first infrastructure, the role of MSPs must also evolve.
From here, it does not take too much imagination to forecast the possible application areas for managed services, even outside of IT. At its core, MSPs add a unique and irreplaceable value to the enterprise (that is if they are doing their job right — but more on that later) by:
● Bringing years of expertise that would be otherwise inaccessible to an enterprise without costly hiring or acquisition
● Making available deeply entrenched partner networks at a short lead time
● Providing tangible infrastructure support without capital expenses
● Acting as a business continuity/disaster recovery aid through remote offshoring of services
● Enabling service simplification and assurance through a strategic blueprint/SLAs
Put merely, MSPs are a problem-solver for the myriad business activities (backend and front-end ) involved in powering an enterprise. It also includes non-IT opportunities.
1. Managed print services — Among the more common non-IT managed services offered by leading companies like Xerox, HP, HCL Technologies, etc. MPS intersects technology capabilities of managing print hardware and connected infrastructure with needs such as employee productivity, carbon footprint reduction, and print costs reduction.
2. Managed content services — A natural progression of MPS, expected to subsume MPS soon. It intersects print and digital communication with cloud-based enterprise content orchestration, focusing on its outcome aspect — i.e., universal content access, content rights management, and data security.
3. Managed HR services — Revisiting the typical HR outsourcing model from a customer-centric perspective to enable closer collaboration in the planning, design, development, and execution of HR strategies. While outsourcing, it is essential to review Virtual HR or Operational HR strategies to a range of options that connect employees directly with HR systems. It reduces HR staff’s time commitment to maintain employee information integrity and serve staff now. Virtual HR allows team members to own their data, keep on top of training needs and appraisals, and get company news and developments. Integrating social technologies into recruitment, development, and engagement is becoming more common. A strong social media presence and strategy helps to locate top talent and critical talent. Online reputation needs have to internalise. Thus, to be data-driven HR, it is essential to build action plans transparently for improvements and listen to internal/external sources.
4. Managed contact centre — A consolidated network and customer engagement solution to streamline contact centre or call centre operations. Leading telcos like Verizon and Orange offer this type of managed services in partnership with companies like Cisco.
5. Managed food services — a customer or employee-facing service in business settings with a large labour force. Managed food services and other external amenities management partners are popular with the public sector and large enterprises. Sodexo offers healthy, varied, balanced meals with seasonal produce while balancing our use of natural resources with our clients’ operating contexts, and our guests’ budgets
6: Managed Facilities services — Facilities management is a growing market, maturity of processes & people has raised companies’ tendency to consolidate or outsources. The facilities managed market is ripe for disruption. Facilities management lags behind other functions such as production equipment maintenance by digital maturity and technology penetration. Lack of a new target operating model and lack of customer experience measure has allowed the service to remain. While technology is available for facilities management, several obstacles have inhibited adoption, such as a lack of digital skills within the function, other leadership priorities, and a focus on continuous cost-cutting. The opportunity is to create an integrated process and database view for smooth process execution and delivery engagement & experience to users/tenants. It will be worth mentioning how startups address this opportunity like Caleedo Business Support Services /Facilities Management Industry, knowing that rapid changes are imminent. The industry would be at the cusp of a digital revolution.
Pitfalls to Avoid
Any managed services relationship is fraught with complexities, and this can be a problem for on-IT or non-traditional areas due to the absence of industry-standard KPI benchmarks. Some of the key pitfalls to watch out for are:
● Reactive monitoring — MSPs should not wait for a ticket/issue to emerge and then resolve in line with SLAs. Everything as a Managed Service approach is not centred around timely issue resolution but aims to improve its service expectations to add value.
● Weak project management — A managed services project will have risks and opportunities that require a careful assessment before outlining a strategic plan. Accurate time estimate, project scope, milestone setting, and dependency mapping is essential for a non-disruptive transition to a managed service.
● Break-down in SLA integrity — For long-standing engagements, several staff turnover cycles can erode SLA integrity over time, rendering customer expectations vague and seemingly unachievable. It also negatively impacts the MSP’s internal drive to enhance engagement in the absence of SLA integrity.
● No incentive for innovation — If an engagement becomes prone to constant troubleshooting (either due to an expectations mismatch, a technology/skills shortfall, or market forces), the MSP will have little time or incentive to innovate. Unless the customer stresses differentiation and is ready to pay for it, value generation will stall.
● Document every step — If the lead member from the network tower had written what each service process involved, a replacement could have quickly filled in, picking up where things left off.
● Understand how your MSP brings resources on and off — It’s crucial to know how to distribute resources logically and efficiently. Reallocate them to an area with greater need. We can always move those members back later if we need them; please review the skills and competency level of resources and align them to incidents and problem tickets in hand.
● Look for improvements during the transition — Your process may be useful, but could it be better? Improving processes ensures that resources deployed are most effective and that transfers are clean and smooth. Transitioning will be difficult if the methods are ineffective and unclear. It is essential to align the presentation, proposal and pitch documents are aligned to the transition plan and expect a clear understanding of how early value contribution starts,
In my experience, these are the most common causes of engagement failures, and I would caution MSPs to avoid these pitfalls as they navigate 2021’s promising market opportunities.
How to Get It Right, Straight Out of the Gate
Once we recognise that every service can be a managed service, one vital best practice to remember when finetuning your offerings portfolio is customer-centricity. Traditionally, managed services entailed a lift-and-shift service transition where the customer would handover the processes in question as is. However, this would:
● Place the attention solely on issue resolution as the nature of the service doesn’t change
● Negate project management as there is no scope for transformation
● Lead to non-adaptive SLAs that erode over time
● Offer no incentive to innovate or add value, either by the MSP or the customer
Which are the same pitfalls we are looking to avoid.
In contrast, to do their jobs right, MSPs should ideally adopt a customer onboarding approach that takes a leaf out of SaaS companies’ playbook to unleash real transformational value in Everything as a Managed Service engagements.
I discuss customer onboarding for MSPs in 2021 in exhaustive detail in my latest white paper — here is the download link.
To know more or continue this discussion, please email me at Arvind@AM-PMAssociates.com.
