Four Ways MSPs Can Influence the Switch to Managed Services
I was hosting my regular monthly Business Office Hours a few weeks ago and the following question was posed by one of my partners: “Do you have any collateral or talking points I can use to help persuade my break/fix customers to move over to managed services?”
The concept of managed services—where businesses subscribe to an outsourced network management support model for a prescribed monthly fee—has been around for well over 20 years. And with the rise in cybersecurity attacks and the changing security landscape, partnering with an MSP and enrolling in their monthly managed services program is increasingly a necessity. So this question had me asking a question right back to the group: “How many MSPs here are still supporting customers in a purely break/fix fashion?”
I admit I was astounded when over half of the 30 or so people in attendance stated that they still have clients they support in a purely break/fix manner.
I didn’t think it would be that high.
I’m going to state something that might be considered controversial: Continuing to support businesses in a break/fix manner—given everything going on in the world today around cybersecurity—is something that is NO LONGER ACCEPTABLE.
To be considered a true Managed Services Provider (MSP), you need every customer you work with to be committed to a managed services contract. It could be very chaotic to your organization if you’re trying to support both models: those that are enrolled in a monthly services contract with you, and those that you allow to call whenever they want, whenever they have a computer issue.
So if you are still struggling to get your break/fix clients moved over to the managed services model, what can you say to convince them?
Here are four ways to convince break/fix clients to move to managed services…
1. Talk about the better outcomes you’ll be able to provide that you are not able to deliver effectively now
When it comes to selling managed IT services to your existing break/fix clients, it is important to recognize that you are NOT selling
- Better technology
- Better solutions
- Your technology best practices
- Network monitoring, patching, MFA, email security, etc.
And you want to stress that your team is much more than just an on-call Helpdesk.
So what are you selling? You are selling outcomes. You want to promote the advantages from a business perspective, emphasizing how their organization will benefit by making the switch from a break/fix arrangement to a monthly managed services engagement. You want to talk about what matters most to that business owner and what they truly care about—things that will help make their business more profitable, more competitive, more productive, more secure, and more efficient than it currently is today, under a break/fix arrangement.
You can help a business owner improve the productivity of their staff because they will no longer have to witness workers sitting around waiting for someone to show up to fix their systems whenever they go offline. Because when employees aren’t working, they are costing the business money—and the business can’t get back on track making money until the employees are working again.
So the benefits of your monthly managed services agreement are to minimize unexpected downtime and the associated costs that result from unexpected downtime. Today, their engagement is based on a lot of firefighting—which is disruptive and chaotic for organizations—and your goal with your services is to do away with the firefighting and create a more stable, reliable, and optimized network environment for the employees.
2. Talk about your ability to provide higher levels of predictability
David Wilkinson, CEO of MSP Advisor, says that one of the biggest mistakes emerging MSPs make with their break/fix clients—one that makes it more difficult to sell them on a managed services arrangement—is that they tend to overservice them. MSPs end up providing guaranteed predictability and priority response without the clients having to make any sort of financial commitment in return. He makes a joke during his bootcamp that in most sessions he delivers, there will be at least one MSP who will get that call or receive an email from one of their break/fix clients saying that something in their network has broken and their employees can’t work.
This most often causes them to immediately leave the webinar, drop what they are doing, and turn their entire attention to that troubled client to figure out what their issue is and how to get their issue resolved ASAP. But what has this customer done to receive that kind of priority response and predictability? They’re not under a retainer. And they aren’t paying a monthly fee for that kind of priority response and care. Yet the MSP is providing such a high degree of exceptional service—dropping everything (like participating in training that will help the MSP business owner improve their MSP business) to assist this break/fix client.
You should save this kind of predictability and priority response for your managed services clients who are paying for this level of service. If you truly want to get those break/fix clients over to a monthly managed services arrangement, then you could retrain them and reset their expectations. You might let them know that moving forward, everything you do for them will be on a ”best efforts” basis. You’ll get around to assisting them when you can, but when they call you will no longer be dropping everything to rush over to fix their issue. Those benefits are reserved for your paying managed services clients who have signed a contract with you. They get your immediate attention first.
3. Talk about the consequences and costs of unexpected downtime, especially if their downtime is the result of a security attack
If you are still supporting break/fix clients, a security attack will be likely to occur. With your break/fix customers, it is highly probable that their organization is lacking the critical security products and services needed today to properly protect their employees and their network, and if their network does happen to go offline unexpectedly, it will likely be the result of some sort of cyberattack. Not only will your customers experience loss of revenue, loss of productivity, and your own remediation bill to try to fix the situation, but also a myriad of other costs that they could be subject to if they fall prey to a ransomware attack, including:
- Cost of the ransomware payment (if you are not able to successfully retrieve their data)
- Regulatory fines and penalties
- Customer notification and communication costs
- HR costs and legal costs associated with dealing with aggrieved customers
- Higher insurance premiums
- Consultancy and employee training costs
- Possible attack reoccurrence—if they got your client once, good chance they will try again
- Loss of sales and loss of customers due to decreased client confidence
- Reputation and brand harm, resulting in possible closure of the business
4. Worst-case scenario if the other three options fail: Tell them that you will have to let them go as a client
In saying this, though, tell them you would be more than happy to help them migrate to another MSP who can continue to support them in the break/fix model they prefer. But explain that you are no longer that type of provider due to the security risks that the break/fix model inherently has.
So if you are a managed services provider, still supporting clients in a break/fix manner, I encourage you to cease and desist. It is too risky and can seriously jeopardize not only your livelihood, but also the livelihood of your employees if something happens to go wrong from a cybersecurity standpoint at your customer’s site. You need to be all-in with your clients, and they need to be all-in with you, for the safety, security, operational efficiency, and productivity benefits of both organizations.