By Mark Winter, Vice President, RapidFire Tools, Inc.
Lucrative managed service agreements are the Holy Grail for solution providers, generating incremental recurring revenue. When multiplied over many clients, these services can swiftly add up to sizable, predictable monthly incomes. As many successful managed services providers (MSPs) have already experienced, such services can be delivered through a remote monitoring and management (RMM) platform, where technicians can manage the end-customers’ networks from a single workstation at the VAR’s location, without so much as a field visit.
Yet there is still a percentage of the market that has not yet made a transition away from the more traditional break-fix or equipment-based reseller model. Meanwhile, hardware continues down the road toward commoditization, and hosted services are gaining mainstream acceptance due to established cloud platforms from mammoth market players like Google and Microsoft. As these factors emerge, more VARs are looking to adopt a managed services business model.
The question for this VAR profile is, then: What’s the easiest way to migrate toward a service-focused, MSP model? One proven method is to deliver network assessment services, used as both a prospecting tool and as part of your ongoing, fee-based services. For that matter, regular network assessments can make your end-customers less vulnerable to an interloping competitor. Here are five guidelines to ease the transition to an MSP-based model:
1. Lead With A Free Assessment. IT services providers can leverage a sophisticated yet non-invasive network assessment as a powerful bargaining token to open a dialog with a new company. Assessment results are often jaw-dropping for the end user, even if the system in question does not exhibit a major failing. Reports typically spotlight pages worth of inefficiencies that, once addressed, can ratchet-up security, fine-tune access policies, and enhance productivity. For example, general network assessments frequently reveal caveats including users who are no longer on the system yet still have access (e.g., former employees); computers with fragmented hard drives or saturated memory; and conflicting user policies. Similarly, a security assessment can scan tens of thousands of ports across a client’s IP address range and identify specific points of entry that are vulnerable to hacking. With the right tools, comprehensive data can be generated in an afternoon’s visit.
2. Be Unobtrusive Yet Authoritative. Once a prospect accepts your invitation, the quicker and less intrusively you can produce meaningful data, the more of an expert you will appear to be. If you supply a critical assessment in short order — without an installation or even a downloaded agent — you will present yourself as a formidable and effective potential partner. This approach also has the benefit of minimizing your own time and labor, allowing you pursue more leads in a shorter timeframe. The objective is to convince the end user that your team is so knowledgeable and expedient, and your tools are so proficient, that the competition is incompetent in comparison. That’s a valuable selling point when building an MSP (or any other) client base.
In addition, a non-invasive IT assessment method allows solutions providers to assess a network without involving an existing IT department. That lets the provider evaluate the performance of their customers’ IT teams without that team’s knowledge, to confirm on behalf of the customer that the team is effectively conducting itself.
3. Keep The Assessments Coming. Many resellers initially invest in assessment solutions for prospecting. We’ve seen that even long-establish MSPs with network assessment capabilities sometimes limit its usage to this purpose. Keep in mind, the beauty of a network assessment tool is this: The same service that elucidated the shortcomings of your new client’s network can continue to generate revenue for your business. VARs should utilize these investments to perform recurring assessments on existing customers. Certain tools make ongoing assessments more manageable, providing “change reports” that only list the items that have varied since the last evaluation.
4. Safeguard Your Customers Against Competitors. If you are able to enter a strange environment and identify network foibles in minutes, consider that a competing provider might be able to do the same when you’re not looking. Make sure your client’s systems are reviewed regularly and fixes for any red flags are conducted on the same schedule. Thus, you will avoid falling victim to a competitor’s re-assessment.
5. Ascertain The Scope Of Future Work. If you are pitching a new client and an assessment is not required in order to win the business (e.g., due to a referral or a previous relationship), realize that it is still a valuable metric for your own purposes. A review of a new customer’s environment can help you determine the amount of labor associated with the new relationship. Resellers can use this insight to determine pricing and personnel commitments.
The right network assessment tool can be an important springboard for the IT services provider looking to grow his or her businesses through managed service agreements. These tools help facilitate a more streamlined entrée into the managed services market, making the reseller less dependent on low-margin hardware sales, and facilitating more consistent revenue streams.
Mark Winter is a Vice President at RapidFire Tools, Inc., the developer of the Network Detective assessment modules. Resellers can visit www.rapidfiretools.com for a video demo of a network assessment product in action.