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The MSP Value Proposition

We call ourselves an MSP (Managed IT Service Provider), we see ourselves as part of ‘The channel’ – but do our customers see any of this? Do they even care? Most of our customers just think of us as ‘the IT guys’ – the go-to-guys when it comes to technology.

Author: Paul Azad, founder, ServiceTree

As a vertical-integrated company within the Information Technology space, we have an important role to play – ensuring companies are not only utilizing their technology well today – but also looking around the corner to see what is coming. I wish that all MSPs did this, but I see it quite often as not being the norm – and those that do, call themselves a TSP (Total Solutions Provider) to differentiate themselves.

What Moving to the Cloud Did for MSPs

Most MSPs have spent the last decade or so moving customers to the cloud in any way they can. The original big push that made a lot of MSPs switch to that model was Office 365, and more specifically the shiny penny that was making most MSPs excited. Instead of selling Microsoft Office one time per PC every three to five years and making money, they can now make money each month. This was the start – MSP’s started to sing the subscription song to their customers, telling them how much better it was for them. Of course, it also sounded much better for the MSP, too.

Something that most MSPs didn’t consider is how it changed the relationship with their customers. For those that were MSPs before the rise of the cloud, our customers valued us not as a commodity, or cheap technology, but the go-to people that knew their vertical-integrated company and could show them technology that could empower their business. This might still be the case today, but their dependence on their current MSP is nowhere near as valuable as it used to be. They have lost that relationship to their own MSP – and the essence has to do with the cloud.

MSPs Need to be Agile

With that all said, is it doom and gloom for MSPs? Have we lost all of our value entirely? No, not at all. We do however need to consider that the market is changing, and we need to be ready and adaptive.

We generally hear the word agile being used quite often in the development world, and we really should not only hear it more in the MSP space – but we need to live it, too. Our customers’ businesses are changing, and we have to be mindful of this and aware as to how their business is being disrupted by technology.

It’s very easy to just keep looking for new business – focusing our energy there, but just as important are our current customers. We need to continuously demonstrate our value to our customers.

MSPs and Customer Relationships: The Win-Win

Demonstrating all of this helps us make our value proposition to our customers clear and allows us to create the Win-Win relationship we both want.

We’ll leave you with this: Think about your accountant – how loyal are you to them? If you could move all that knowledge to the cloud – so that another accountant could easily take over helping you with your financial needs, would you stick around?

Gone are the days that a customer of an MSP would dread looking for a new MSP, because the thought of finding a new provider alone was dreadful. Finding one that knows how they work, and somehow transitioning all the knowledge acquired through their current MSP to the new one was just too much. However, today, most customers now see themselves in the position of power. Moving from one MSP to another is easier than an MSP changing their PSA.


Guest blog courtesy of Paul Azad, founder, ServiceTree. Read more guest blogs from ServiceTree here.

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