It’s no secret. Cloud computing and low-cost competition continue to force the managed services industry into commoditisation. MSPs must innovate and enhance business practices if they wish to retain value and keep pace with competitors. With new providers emerging into the marketplace every day, this creates a “me too” scenario and standing out from the crowd becomes a difficult task unless portfolios and customer service are remarkably unique.
Making hasty decisions to lower prices in an attempt to retain and gain customers by advertising as the “best service and value” MSP creates a lose/lose scenario for all involved. Although cheaper prices may look appealing to a prospect, the last thing that they want after signing a contract signature is to discover that they are a captive and not a customer. There’s no use in MSPs going above and beyond to win a new customer and then neglecting them shortly after acquisition.
An evolved role
Customers expect their service provider to understand their requirements, goals, and challenges, and rightly so. It is no longer just about taking care of a customer’s IT needs but rather being involved in their business strategy, planning and execution and taking on an advisory role. Customers want to be informed and supported on their journey, receiving guidance on business activities like capacity planning, business continuity, disaster recovery, budgeting and right-sizing infrastructure to meet customer needs. This approach will not only improved contract renewal rates but also increase margins on accounts. A small price to pay in terms of time, in exchange for a large ROI in revenue.
Turning a blind eye
Many service providers are not actively making the effort to go above and beyond to improve customer relationships, nor do they have the will and means to do so. The main issue is the continued focus on new customers to drive revenue while ignoring the underlying issues that exist for current customers.
This is a part one of a three-part blog series.
- Written by Farrah Aslam
- Published: 04 January 2019