If you’re not a world class MSP today, make it a goal to become one in 2022. World class MSPs have command of their operations, are focused on sales, and most importantly, driven by process. The only way for an MSP to hit all three attributes of a World Class MSP is by following a framework built around standards and strategies.
At TruMethods, our process combines software, training and community. While there are many aspects to it, the framework is made up primarily of two components: developing standards and building a strong relationship with the customer.
We’ve covered the TruMethods framework in a variety of blog posts recently, but there are several you should reread if becoming a world class MSP in 2022 is part of your 2022 business plan.
To some, it can be difficult to differentiate between aligning clients with standards and best practices and documenting client environments. MSPs should consider both areas significantly important but understand the difference between the two.
In any business model, each role needs to do their job to the best of their ability. This has remained a principle of business since the beginning of capitalism. But how have things changed for everyone throughout the course of the pandemic? The Technology Alignment (TAM) role in particular could be seen as the role that changed the most in our MSP model, but the core of it remains the same.
When something’s not working, it’s time to reevaluate what you’re doing. There’s bravery in asking for help. And after you do, you’re oftentimes rewarded.
Although some people have returned to the office at this point in the pandemic, there are still many people working from home. Of the companies that are still working from home, their office parking lots have not seen nearly the amount of activity that they once did. At one point after TruMethods went to work from home, I drove past an office parking lot in town and noticed mother nature was taking over.
A lot of the business world for many years has revolved around the idea of being as efficient and robotic as possible to make sure we are as profitable as possible. And don’t get us wrong, being efficient is great and necessary to have a good business, but for so long the ‘softer’ skills have been neglected, especially in the tech world. The idea of understanding how we work as people and using that as a context to help others and ethically make money is relatively new.
I spent some time in Vegas a little while back (for business, not pleasure, although there was some of that). I took the opportunity to meet with many TruMethods members and attend several industry events. After heading back home, I thought it would be a good idea for me to share some of the key takeaways from my most recent trip to Sin City with you.
The first day of my trip we held an event for TruPeer members. Boy, you could feel the energy at the opening cocktail reception! People were so happy to be back at an in-person event. We spent the next day gaining perspective, talking about security, new legal issues, and the future of managed services.
This is a time when every MSP needs to gain perspective. You need to find ways to understand more about the changing landscape. Read industry news and blogs, go to a few events, and join a peer group. You cannot understand what you need to do differently just by using your logic or by working on a support ticket.
After spending time with TruPeer members, I participated in an industry M&A event. It’s obvious that the impact of M&A and private equity money is changing the MSP landscape and will continue to impact every MSP over the next three to five years and beyond. Our market will look much different in large part because of these changes. Every MSP leader needs to understand how these changes will impact your approach to the marketplace. Even if you don’t plan to sell or buy, you need to stay on top of these trends.
Finally, I want to share my takeaways from Kaseya Connect IT 2021. It was great seeing so many customers and old friends. There were a lot of sessions around security, M&A, legal — those kinds of things. But the thing that struck me the most as I surveyed MSPs during my sessions was how the markets have changed over the past two years.
Speaking at events two years ago, MSPs were more on a gradient scale of growth, profitability, and seat price. Today, there’s much more bifurcation. There is a group of MSPs that have evolved. They have changed their security posture and are commanding higher prices. Then, there are other MSPs that seem a little stuck, still trying to figure out how to adapt to the new environment.
I think the next 6 to 12 months is a critical time for MSPs. During this time, they will need to work to align their offerings, their security postures, and, most importantly, their pricing structures to meet the current SMB landscape.
And when you figure it out, pay it forward. There’s enough money on the table for everyone.
Selling is what I do best. I’ve been doing it for several decades and still get excited whenever I make a sale — no matter the size of the deal. While selling is in my blood, I realized many years ago that selling didn’t come easy for everyone, especially MSPs.
I decided to do my part by helping MSPs turn into salespeople. I’ve done this by making sales a core component of the TruMethods framework and speaking at industry conferences, and on various webinars and podcasts about how MSPs can improve their sales skills. And you can’t forget the TruMethods blog, where I’ve contributed my insight on the selling process for hundreds of blog posts.
Here are six blog posts on selling you may have missed in 2021.
Operating your business at the seat of your pants is a recipe for disaster, as many of us can attest firsthand, but the same goes for running sales meetings with your salespeople. Without a well-defined structure in place, a sales meeting will produce nothing meaningful and waste everyone’s valuable time. Nothing will get accomplished, nobody will be held accountable, and you won’t sell monthly recurring revenue (MRR) at the right price for very long.
If you’re a TruMethods veteran, you were probably expecting this blog post any day now, but if you’re new to the TruMethods framework, this year may be your first selling season. Either way, selling season is underway, and it’s time for you to add new MRR at the right price.
Hiring more salespeople for your MSP business may be on your wish list for 2021, but if you don’t already have processes in place and don’t know what to look for during the hiring process, you may not hit your sales goals for the remainder of this year.
An important concept for MSP salespeople and business owners to grasp and understand is that the majority of the sales process should be focused on the prospect.
When it comes to MSP sales, I love the things that I have control over. Preparation, organization and discipline are some of those things that we can not only control, but also will lead to success in the sales process. If we don’t control the things we can, we are being a mediocre version of ourselves. Success and results will come from properly organizing yourself.
Building and maintaining a well-organized prospect database takes hard work and dedication, but over time, your salespeople will reap the benefits. But in order for them to do that, they’ll need to know where their leads are in the sales process at all times.
Many MSP owners lack business acumen skills, but that’s not entirely their fault.
MSP owners typically start off as technicians before becoming business owners. The skillset required to succeed for each role is vastly different. Once they come to this realization, they oftentimes look to hone their business acumen skills through a variety of means.
There are three ways for you to begin building your business acumen.
Figure out how your customers make money
Remember: You’re not in the technology business as an MSP. You’re in the business of helping your customers with achieving their business objectives. That’s how you generate monthly recurring revenue (MRR) at the right price (and become a World Class MSP). But how exactly do you help your customers with overcoming their business challenges? You must first understand how they themselves generate revenue. In other words, how do they make money? Who are their customers primarily? Are their customers consumers or other businesses? By finding out how your customers generate revenue, you can better position yourself as not only a trusted IT advisor but also a business consultant to them.
Find a mentor or peer group
If you’re not a business expert, you’re not alone. Like many MSP owners, you probably started as a technician. At some point, you decided to open up your own shop. Eventually you realized the importance of implementing processes and looked for some outside guidance, as many MSP owners do. Turning to a mentor or joining a peer group is one of the easiest ways to help you with overcoming business challenges you’re unfamiliar with. There are MSP owners who’ve already gone through what you’re going through today. There’s no reason to reinvent the wheel when there are other MSP owners with the answers to your business problems.
Again, technology is your business, not the customer’s. If you specialize in verticals, educate yourself on what’s going on in them. Attend industry conferences, read industry publications, skim industry blogs, speak to industry thought leaders and listen to industry podcasts to learn more about what’s being discussed, day-to-day challenge and top trends. If you don’t know where to begin, reach out to your customers. They know their industries better than you.
While you may feel like you don’t have the time to build business acumen, you do. There’s time in your schedule; you just need to find it. If you need to hire someone, do it. If you can automate manual tasks, hire a vendor to help you. Without a strong business acumen, your business will never reach its full potential.
If you’ve been a TruMethods member for a while, you’re more than likely in the process of creating your sales plan for 2022. In fact, if you’re a World Class MSP, you probably already have a plan ready to go for the new year. But if you’re new to TruMethods or have been having a rough year, you’re probably focusing your efforts elsewhere.
While it’s great to have sales goals, they must also be reachable. Without a sales plan in place, your salespeople will struggle with hitting their sales goals. A sales plan ensures there is a path for them to follow.
There are three things you should consider before creating your sales plan for 2022 if you haven’t already started the process.
Putting your sales situation into perspective
Before creating a sales plan for your business, you need to first put your sales situation into perspective. What does that entail? Simply put, getting your numbers together. What’s your churn rate? What about required changes in revenue mix, average monthly recurring revenue (MRR) and all-in seat price (AISP)? You also want to look at your salespeople’s close ratios, what your sales team is doing to create clear separation in the sales process, and whether your salespeople are presenting too early to prospects. The more data you can pull together, the better the plan will be.
How did your sales team fare in 2021?
Then assess how your sales team fared in 2021. Did your salespeople reach their MRR goals? If they didn’t, why didn’t they? What about new clients, average MRR, non-recurring revenue (NRR) and the AISP of new clients sold? How much in new MRR did your salespeople generate in 2021? When evaluating your organization’s 2021 sales results, your goal should be to look under the hood of your business to determine where your salespeople can improve and help them with getting there in 2022.
What’s in your sales pipeline?
Your salespeople must have access to a well-organized prospect database if you want them to sell successfully at the right price. If they didn’t generate enough MRR in 2021, your prospect database may need some work. First, look at how many companies are in your database. What do you know about them? Did you categorize them into buckets? After that, it’s time to evaluate growth. How much did your prospect database grow over the course of the year? How could you have grown it faster? And finally, what size should your list be? How many suspects and prospects are in your database? Keeping your database up to date and clean is key to selling more MRR at the right price.
You should already be well into the sales planning process for 2022, but if you’re not, today is the day to begin putting your sales situation into perspective, assessing how your sales team fared in 2021, and tweaking your sales pipeline for 2022.
We have the luxury of speaking with hundreds of TruMethods members about their day-to-day struggles and well-deserved successes. We always learn something new and interesting whenever we meet (whether it be in person or virtually) with our MSPs. We always look forward to sitting down with a new member or catching up with someone who’s been following the TruMethods framework for years.
While we unfortunately don’t have the time to sit down with all our members for in-depth conversations, We’ve had discussions throughout the year with many of them, some of which we’ve published on the TruMethods blog and have impacted the way our members think about running an MSP in world where the IT threat landscape is ever-changing.
Here are four TruMethods member Q&As you may have missed in 2021.
When something’s not working, it’s time to reevaluate what you’re doing. There’s bravery in asking for help. And after you do, you’re oftentimes rewarded. Jimmy Huber, president and founder of InfoTech, spoke about how he has implemented what he’s learned from TruPeer, what TruMethods provides that other vendors can’t and how myITprocess has helped him with developing a repeatable client process that is the basis for high-value relationships.
Processes must be put in place if you want your business to succeed. We at TruMethods work with you to accomplish just that. Paul Barnett, CEO of Network Depot, a Reston, VA-based MSP and TruMethods member, revealed why he believes TruMethods is so valuable, shared his thoughts on the TruMethods methodology, and highlighted his favorite feature of the myITprocess software
You don’t join a peer group to network with people in your industry. You join one to learn and overcome the challenges you’re facing. And the only way a peer group can help you with that is by being organized and providing you with the right content. Jason Buckley, Partner at Jasco Technology, a Las Vegas-based MSP, revealed how TruPeer is different than other industry peer groups, what he’s learned from being a member of our peer group, and how other MSPs can benefit from TruPeer.
Joining a peer group takes a lot of courage. While being in a peer group can benefit you in many ways, the process usually isn’t for the faint of heart. Peer groups are designed to give you tough love when it’s warranted. Being open minded is key to your success in any peer group. Hoyt Hagens, president of ProMission, a Meridian, Idaho-based MSP with customers in several industries, revealed how he was willing to be vulnerable and make changes to improve business results, how TruPeer (TruMethods newest peer offering) has made him more accountable, and what MSPs considering TruPeer should know about the industry-leading peer group.
MSPs are getting creative with their sales conversations. For example, some MSPs are offering qualified prospects free risk assessments in an attempt to move their sales discussions along. While this is a potential strategic tool to use with qualified prospects, be careful making assessments a part of every sale, as there could be unintended consequences.
While I am in favor of anything that works, I have found that having the right pain conversation can oftentimes get you to the same place faster and without having to use so many of your valuable resources.
For instance, you can uncover common issues by simply asking a prospect a few questions. The next step would be to then have the prospect attach a value to the pain they’re experiencing and plan the next agreed upon steps. In this case, there is no assessment necessary.
Here are some of the pitfalls to avoid when offering free risk assessments to qualified prospects.
First, doing a free risk assessment for each of your qualified prospects takes up not only time but also resources, which takes resources away from adding value to your customers (you know, the people already paying for your services). Remember: Acquiring a new customer is anywhere from 5 to 25 times more expensive than retaining an existing one. Being smart with your time keeps money in your pocket and your customers happy!
Then there’s the sales conversation itself. The goal should be to always shift the sales conversation away from technology, not toward it. By incorporating a free risk assessment into your sales conversation with a client, you could swing the pendulum in the wrong direction. Instead of talking about how you can help prospects with solving their business challenges, you’re evaluating security postures and assessing risk.
The key to leveraging an assessment is to be sure you have an understanding with the prospect on what happens after the assessment. “Mr. Prospect, I am confident the assessment will uncover issues and changes that we would recommend. What would happen next?” If the prospect has no intention of working with you no matter the results of the assessment, you want to know that upfront.
Offering free risk assessments to qualified prospects can work, but first, ask if there is a way to have the same conversation without having to deploy valuable resources.
The cybersecurity landscape continues to shift rapidly. The number of attacks has increased, and the complexity of those attacks (which may involve high levels of social engineering and sophisticated phishing and email compromise techniques) has grown. Cybersecurity technologies have also evolved to meet these challenges because attacks are now harder to spot with traditional email and firewall security.
That is why it is easy to see modern cybersecurity as a continuing escalation of technological craftiness on both sides. In that context, MSPs with a security focus simply need to apply the right technology to their clients’ networks to ensure strong cybersecurity. But that approach overlooks one unchanging fact—the most vulnerable part of the infrastructure is still the employee accessing the network.
That’s why cybercriminals have shifted much of their focus from broad-based attacks to business email compromise (BEC) and other schemes that use psychology to trick end users into revealing passwords and other sensitive data and even approving fraudulent transfers of funds. With enough information gathered freely online or via low-level breaches of email accounts, criminals can craft email messages that are convincing enough to trick even somewhat skeptical employees.
That means security awareness training must be part of a holistic security offering. This ensures that the investment the client has made in advanced security technology will pay off and generates revenue and business opportunities for the MSP.
Discuss the Importance of Security Awareness Training
MSPs should have regular conversations about security training with their clients. New threats are constantly emerging, while new hires may be joining the network at a relatively rapid rate, and experienced employees may forget some security hygiene basics. The first line of defense against a successful attack is making sure employees can recognize phishing emails and have procedures to report them.
While BEC attacks (mentioned above) still account for less than 10% of spear phishing, FBI data indicates they are among the most expensive types of attacks, causing more than $26 billion in losses over four years.
For MSPs, highlighting various benefits can help convince clients to invest in security awareness training as part of their comprehensive services package. For example, a formalized program helps them track the training results (along with phishing simulation results and testing), so they can see their progress and better understand the ROI.
Leveraging training through a trusted MSP partner also saves the client time, provides access to well-developed training programs, and ensures that the training can be conducted by staff with specific expertise (which is often lacking internally). Because the MSP also provides security technology, the training can be easily dovetailed into application-specific content. After the training is complete, the MSP also has visibility into network behavior and security incidents to help identify critical areas for additional training. They can even tell which users may need more interventions by using phishing simulation and other network monitoring technologies.
MSPs can also provide ongoing reinforcement through email alerts, newsletters, gamified training exercises, and other resources that can take the training burden off the client, while providing a much broader array of support and resources that could be created internally.
Demonstrate Your Training’s ROI
For MSPs, selling security awareness training as a standalone product or part of a comprehensive suite of services will require emphasizing value upfront. With employees trained to recognize phishing, BEC, and other types of attacks, clients can reduce the number of successful attacks and improve productivity by avoiding costly downtime. They can also prevent some of the most expensive types of attacks, in which employees are fooled into approving wire transfers or sharing sensitive data.
MSPs should have data on hand to demonstrate how the cost of security incidents can erode their security ROI and how training helps spread the responsibility of security across the organization. They also need to factor in the cost of additional incident-related services they may be charged for.
For example, compliance requirements also play a role, and MSPs should be educated on industry-specific requirements (i.e. HIPAA and FINRA) that may emphasize the need for employee training. Then, make sure your training courses cover those requirements and regulations.
Phishing simulations are another critical component of security awareness. Utilizing these types of simulations can reinforce training and identify personnel who may need extra help in recognizing malicious emails. Data from these simulations can also demonstrate to the client how much education their staff may need and provide key performance indicators to show how valuable the training is.
Most importantly, a solid training program will raise awareness of cybersecurity issues across your client’s organization and help them achieve buy-in regarding new security technology, policies, and procedures. This combination of business benefits and security protections show why security awareness training should be a vital component of an MSP’s complete security stack.
Michael Mowder is the Senior Director of Global Partner Success for Barracuda MSP, a provider of security and data protection solutions for managed services providers, where he is responsible for the partner journey from on-boarding, to implementation, through professional services and finally, renewal.
I’ve found the saying “measure twice and cut once” to be so true throughout the course of my professional career.
We at TruMethods work with so many business leaders who put in a lot of effort for very little reward. This is why we at TruMethods put such a high priority on our members taking the time to create effective and thorough business plans, and the business planning process in general.
It’s now more important than ever before to have a business plan in place. The MSP landscape continues to change at a rapid pace. While one of the hardest things to do in business (and in life) is change, you absolutely need to be ready and willing to make significant changes to your business model in 2022 if you want to survive for what’s coming next.
For instance, you need more dedicated proactive resources to address security, governance and management, a more disciplined vCIO process, and more tools in your stack. Also, your average cost per seat has increased significantly. In other words, our business has become drastically more complicated.
There are several changes you can make to change your business for the better in 2022.
First, you must gain command of your business by having a clear view of your current business. Do you know your numbers? If you don’t, you won’t be able to make the right decisions quickly and efficiently. Next, it’s in your best interest to plan, plan and plan some more. You need a well-thought-out business plan with the right priorities in place. Third, hold yourself accountable by always remembering to follow through on your plan. Lastly, rinse and repeat!
We focus on the business planning process every fall for a good reason. The likelihood of you failing is significantly higher when you don’t have a business plan in place prior to the coming year. Without a doubt, fall is the best time for introspection and reflection.
It’s in your best interest to have the best business plan possible in the new year. The bad news is the risk of poor business planning has never been higher, but here’s the good news: The rewards for a great plan also have never been higher.
I’m encouraging you to fully engage in the business planning process as we head into 2022. If you don’t, I can promise you this: You’re going to get left behind.
It’s nearly impossible to make good financial decisions without having access to accurate and reliable information, but gathering that information can be challenging at times, especially when you’re being pulled in different directions. Being that financial planning is an ongoing process, the sooner you begin keeping track of your business’s finances, the better you and your business will be in the long run.
So that begs the question: What financial information should you collect and how often should you collect it?
Whether you like it or not, proper financial planning is key to running a successful business of any kind. The data you collect should be accurate to ensure the decisions you make for your business are the right ones. Staying on top of your business’s finances can make a world of difference, especially when you’re under the gun. There’s always something you can do to put yourself and your business in a more desirable or advantageous financial position.
Some tasks are to be completed annually, quarterly, monthly, and even weekly. And if this seems like too much work to you, think again. World Class MSPs complete all these tasks successfully, and you can, too. You just need to get the ball rolling.
Here’s how often you should complete common financial tasks.
Annually. There are two types of financial planning you should complete annually: life and business planning. Even though these plans are slightly different from one another, they should align strategically with your vision for success (I’ll get into that more later). Both plans ideally should encompass your vision, core values, long-term plan, strategic plan, annual plan, and quarterly action plan.
Quarterly. Your quarterly action plan should be completed — you guessed it — quarterly. For your quarterly action plan, review past quarter’s goals and actions, set goals and action items for the upcoming quarter, and involve team members when appropriate. Also, evaluate your Macro Picanomics, Micro Picanomics, and MRR evaluator.
Monthly. Then there are your detailed financial review, cash-flow, and MSP Turning point, all of which should be updated monthly.
Weekly. There are also financial tasks every you should complete weekly, including assessing your cash balance, payables, and receivables. Even though you’re more than likely already aware of these numbers (at least I hope you are), staying on top of them allows you to make decisions more quickly.
Don’t forget about your personal finances! The above advice can and should also be applied to your personal finances. You must have the same kind of concept, discipline, and command to yield the same type of results with your personal finances. Remember: Your personal and business goals must align if you want financial success in your life.
At the end of the day, visibility enables you to make better business decisions, which is why visibility is so important when it comes to your finances. Basing your decisions on knowledge instead of feelings is how you can operate a financially healthy business in the long run. Let’s go people! Get started today.
