Parenting 101: New MSPs Take Course In Changing Models

New managed service providers, like new parents, are taking on long-term relationships with dependent clients. While they can&t be sure how this will change the way things are done, they do expect some sleepless nights and new responsibilities for everyone in the household.

For many solution providers, integrating managed service offerings into their business has resulted in a culture shift for both sales and support and technical employees as they face infrastructure reorganization, changes in client relationships and the way business is done.

-- Zoltan Sachs, Network Operations Center Director, SymQuest

Who does what, when and where can shift with the services you provide, but one thing is certain: Things will change. Technical staff tends to become centralized as MSPs take on remote monitoring of clients& networks, and sales teams need to redirect their focus from selling a product to selling a relationship.

In the past, SLPowers, a West Palm Beach, Fla.-based solution provider, sent its highest-skilled technicians to client sites. Now, its high-level technicians work at the customer support center, doing what needs to be done remotely while lower-skilled technicians are sent into the field.

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For SLPowers, the first step in switching to incorporate managed services into its Guaranteed Networks portfolio involved becoming familiar with the remote monitoring technologies that made the service possible.

“As remote monitoring tools have gotten better, we&ve adopted that technology and now we&re almost virtual,” said CEO Rory Sanchez. “While we never want to be one of those companies that never visit the client, particularly now that fuel is as expensive as it is we are certainly embracing the remote-control technology.”

Sanchez said in the future the company plans to keep 95 percent of its technicians in-house.

“If they&re doing weekly visits, remotely or otherwise handling these customers, there&s really not a lot of bandwidth there for the techs to do larger project work,” he said. “Everybody was spread thin and not able to become a great managed service tech.”

With 14 field technicians, and 12 of those regularly touching on different managed accounts, SLPowers found it needed to reorganize. Technicians were given dedicated accounts, and Sanchez said that business has benefited. “We&re finding that techs like the idea of saying that these 10 accounts are mine, and I&m going to work with those clients. I&m their inside IT guy. I&m going to manage my time accordingly,” he said. This freed up others to work on the company&s professional services team, providing a valuable revenue stream and helping funnel customers into the managed service program.

At the Lloyd Group, an MSP in New York, the staff was completely restructured to accommodate managed service offerings.

The network operations center went from having one staffer to having four. The Business Enablement Services group was created to evolve the company&s LloydCare managed service offering, and now has a staff of three. The company began the year with 20 percent of its client base using its managed services, and now has 80 percent adoption. The biggest change, however, was the dissolution of traditional sales, customer service and operations divisions and the formation of vertical teams that service individual clients.

“Sales and operations people own clients from cradle to grave,” said Lloyd Group President and CEO Adam Eiseman. “They&re more involved in the entire life of the client from a day-to-day standpoint. The operations people are now more involved in the sales process and the salespeople are more involved in the day-to-day service.”

The change in organizational structure has resulted in a change in the ways employees relate to one another.

“They finally understand each other&s roles and they really work together as a team. The communication has improved. It&s a huge improvement over where we were,” said Eiseman.

For the sales team at SymQuest Group, a South Burlington, Vt.-based solution provider, what they pitch has changed.

Instead of selling a neatly packaged product, reps now need to convince customers to enter into relationships.

“They like a product to sell, so for them to go out and talk about managed services, it&s a little bit challenging,” said Zoltan Sachs, director of the network operations center at SymQuest. “They can&t be going out selling a product; they have to be going out and selling an insurance policy.”

SymQuest has been offering remote network management services for a year and a half and plans to roll out document management services sometime next year.

Since most MSPs sell discrete revenue-based projects and residual revenue-based support, sales reps need to be savvy on selling both. “They are two very different kinds of activities, and the balance between the two is an interesting one for sales reps,” said Sachs.

Sales reps also benefit from the residual income generated during the life cycle of a managed service contract.

At SLPowers, sales reps receive a commission at the time a contract is signed, and also receive residual fees for the life of the account. “Reps are saying, ‘Hey, I&ve got 20 managed service accounts and am seeing money even before I start selling anything,& ” said Sanchez.

Integrating the network management service into its offerings meant moving not only the sales force, but its engineers and technical staff to a more relationship-oriented focus.

“We had to recommit our culture to take personal responsibility for our clients& businesses. That&s a big mental shift for a lot of people. Our clients& success is directly affected by the systems that we manage,” said Sachs.