Six Factors to Consider Before Offering Managed IT Services5 Nov, 2013 By: Michael Amiri, Continuum
Like many office technology dealers, you’re likely intrigued by the potential of a recurring-revenue business model. As office equipment such as printers and all-in-one machines become part of a larger, networked environment, managed IT services can play a vital role in growing your revenue and increasing profitability by helping you meet the outsourced IT needs of your clients. Perhaps equally important, adding managed IT services to your service offerings can effectively defend your customer relationships against traditional small business IT resellers, whose expertise in networking and data systems may otherwise give them an edge.
If you’re ready to make this move, be sure to take certain factors into consideration first. Your choices are especially crucial in light of rapidly changing market conditions within the remote monitoring and management (RMM) provider space. To help you make the most informed decisions, here are six key factors to consider before making your move.
1. Is your RMM partner 100% channel focused? This year, several major RMM providers have been subject to mergers and acquisitions by larger companies—ones that don’t necessarily have a compatible dealer-based sales model. In an environment of mergers, dealers should examine whether their RMM provider—and/or its new parent company—has a history of commitment to the channel, as opposed to a long-term model of direct sales. Choose a partner who considers your dealership, not your customers, as its primary focus. Doing so increases the likelihood that they’re concentrated on innovation, partner support and business development.
2. Does your provider fully understand the office technology market? GAP (Growth Achievement Partners), a noteworthy provider of sales and operational consulting in the office technology space, recently co-authored with Continuum an official Managed IT Services Business Model. (Details at www.continuum.net/businessmodel). The result is the industry’s first blueprint for dealers to follow when migrating to the managed network services marketplace. Such developments make Continuum uniquely positioned to support office technology dealers in their quest to profit from this model. Already Gordon Flesch, ProSource, and SolutionOne have adopted the GAP/Continuum Managed IT Services Business Model and are aggressively pursuing opportunities utilizing this strategy.
3. Does your provider offer a single-source, unified solution for RMM and managed services? If not, you could be exposing your company to accountability issues should any problems surface. When entering this space, dealers should look for an integrated platform from a partner that offers a comprehensive set of innovative RMM software and NOC services from a single vendor – and a single pane of glass. A single-source solution means there is only one company to take responsibility for its performance. With a multi-vendor solution, the minute an issue arises, each vendor directs the blame to the other. Such complications do nothing to further a dealer’s migration to an RMM model in what is currently a rapidly evolving market.
4. Is your partner vulnerable to disruption? The amalgamation of company cultures tends to breed a period of instability. This occurs by way of layoffs due to staff redundancy, or via a suspension of innovation or erosion of customer service, as regimes and policies shift. As technology dealers enter this new space, such factors could be crucial to their success or failure. Look for a partner that can offer long-term stability and an entrenched commitment to both service and ongoing product development.
5. Do you understand your partner’s business model, now and going forward? As RMM companies change hands, it’s important to consider whether your RMM vendor is facing a transition away from channel-based partnerships and instead will seek to expand the direct sales models established by its acquirer. For instance, will a provider that prided itself on a vendor agnostic architecture be able to maintain that model as it becomes absorbed by a larger entity? An open-system strategy that accommodates competing products may not serve the interest of the parent company. If an RMM dealer has been absorbed, will it still receive the same level of resources and attention as before, or will it be relegated to a reduced portion of the larger company’s business? If the purchasing company has not demonstrated a solid channel strategy in the past, dealers are left to wonder whether a smaller, channel-based RMM company will be able to muster the influence necessary to preserve its previous culture.
6. Is your sales team ready? A major challenge for many dealers is the conversion of your sales team and efforts towards IT support opportunities versus the traditional hardware, copy and print conversations. You shouldn’t assume that your sales team can immediately become IT experts overnight, but they can certainly identify IT pain-points and ask leading questions that allows your technical support team to identify quality IT support opportunities from your customer base and beyond. Be sure to select an RMM vendor that can provide you with technology training on the RMM functionality, as well as sales training to ensure your team is well-suited for success in this new arena.
Those of us who have been proponents of the remote management platform from the start are elated to see so many notable dealerships adopting our business model for managed IT services. But office technology dealers should choose wisely in order to establish a productive, ongoing partner relationship. If not, it could have a direct bearing on the dealer’s ultimate profitability as a managed IT services provider. In addition, the potential benefits of this new model are considerable. As the RMM playing field begins to level and the more channel-oriented RMM vendors forge a clear path toward symbiotic dealer partnerships, the choices that the office technology dealers make going forward can help drive the preservation of a consistently channel-centric managed IT services marketplace.
These are exciting times with a wealth of opportunities for dealerships to transform themselves to ensure success and relevance in the decades ahead. These six factors are the blueprints for dealers to capitalize on the rapidly growing $100+ billion managed IT services market opportunity.
Michael Amiri is Director, Office Equipment Industry, at Continuum. Company information can be found at http://www.continuum.net