As we reach the half-way mark in 2017, now is the time of year to examine progress toward growth goals. If you’re ahead of plan, congratulations! But if the numbers don’t add up, a reexamination of business practices and a course correction may be in order.
For many IT Service Providers and MSPs, it’s common to pin slow business growth on sales. But the truth is, obstacles to success often extend far beyond sales. In fact, what might be missing is a business plan that considers how the company is run and the types of customers that best align with its offerings.
It all comes down to these three steps:
Take an objective look at your existing operations to understand how you got where you are today. What do you do best—what are your core competencies—and what does your brand stand for? What are your business strengths, weaknesses, opportunities, and threats (SWOTs)? From an operational standpoint, what is your revenue and profitability? What are the recent results and forecast figures, and what are the specific events that have impacted sales and revenue growth? Consider both the external and internal forces driving any changes in your business.
Also, it goes without saying that an MSP should have clear insight into what percentage of their business is driven by recurring revenue and managed services. And within managed services, the MSP should be able to rank their offerings by profit and revenue across the business, with an eye toward forecasts for future growth in each category.
Answering these questions might take some research or investigation, but only by understanding where you’ve been can you begin to understand and influence where you are going.
Next, look at your customers—who are they? What characteristics do they share? Do they represent a particular geography, industry, or other profile? What business need drove them to do business with you, and why did they select your company over your competitors? Scrutinize previous customer wins and losses over the past few years to determine what drove the outcomes, and think about what can be changed to accumulate more wins. If you don’t have this information, you may need to engage with your customers via audits, surveys, or interviews to acquire it.
With the above information in hand, we recommend that our partners then create an “ideal customer” profile sheet and then build a database of prospects that map to those ideal customer characteristics. By mapping prospects to the business’ core competencies, and steering clear of its weaknesses, you can save your sales team time and frustration, and keep them focused on the best opportunities.
Once you fully understand your business and customers, you can create an overall business plan. Your goals may include getting more similar customers, or expanding to new markets where your value proposition should apply successfully. Or you may want to boost managed services revenue share. Whichever direction you choose, make sure your sales team is on board and fully equipped and prepared to support your goals. Additionally, marketing and sales should work hand in hand, and the executive management team should ensure everyone is pulling in the same direction. Be sure to include specific timeframes and checkpoint goals within the plan to enforce accountability, and allow flexibility for course corrections to be made, if necessary.
The process outlined above will require time and honesty as you work to find out what’s working and what’s not. But because your plan will be backed by informed decisions and data—real data about your business—the chances that you will be able to find more customers and increase sales will be much higher than if you were to rely on intuition alone.
The bottom line is that every business needs a plan. Whether you’re running a lifestyle business as an MSP or your goal is worldwide expansion, think strategically and look beyond sales alone for greater business success.