Advice for Starting Out
Our MSP Advisors share the biggest catalysts for their growth and discuss a common business challenge: how to determine when it's time to hire more technicians.
November 05, 2018
Question: What is the biggest piece of advice you have for MSPs starting out?
Bruce Lach: I would say what might set you apart is if you can develop and manage a superior sales team, I mean getting out into the market and bringing your message to folks. I mean I think what we do at success is so powerful for our clients is that we literally feel morally compelled to tell people about it because they can't further their mission without the help of technology and we provide the underpinnings of that, the support that make it like the lights it's on, it works. It's not an encumbrance to them furthering their mission. So I'm bringing the message to market, starting with a professional sales team and then learning how to leverage marketing to support the sales team. So that would be number one. Number two, make sure you got great tools, great processes, support your people, whether it's a sales team or the, you know, the, the technicians or even your back office folks. Have the right tools in place. Give them the tools so that they can succeed. Let them do their work, do it well. And I'd say if you can do those two things, I think you'll set yourself apart from most other msps in the market.
Brandon Nohr: So back in the day we would just kind of do what we thought was right and really referencing the frameworks. This is key because that's really a roadmap for you to know what good looks like and you don't have to have a CTO or even really senior it staff that, uh, is, is kind of driving the direction because you're really just solving for something that they've already done. So I'd really focus on a framework, whether it's the NICE framework or the CIS controls, something like that that's simple that you can tie your, your offerings to that are solving things. Now that's might be from a management side or it might be from the security side, but it's, it's really here's what good looks like and here's how we're going to get there.
Fred Alonzi: Don't be afraid. Get out there. And, and, uh, you know, beat the pavement. There is nothing, nothing replaces good hard work. And getting the message around asking for business, I think, when I compare myself to other friends who went into business for themselves and maybe didn't fare as well, it's important to have confidence. It's important to have good ideas, but it's also important to sell yourself and not be afraid to ask for the business. I think a lot of people, especially in the IT industry where they don't have a lot of interaction with other people, sometimes they just are afraid to ask for the business. I think you have to ask for it. And, I'm always surprised at where I got the support from. A lot of my customers became my best salespeople. So it's really important to be able to do that and be able to go in and just ask for the business.
Question: What has been the biggest catalyst for your business growth?
Chris Taylor: Our biggest growth early on was really about referrals and customer base that people had contact with. And then the last five years we've really transitioned that more of a marketing focused acquisition methodology. We've moved from referral to much more of a proactive marketing and we dedicated resources and a team to that role to to generate awareness of cit, who we are, what we do more from a marketing name recognition, so when people heard the name or some, as you've heard the saying, oh, I've heard of that before ever. I know where they are,
Bruce Lach: I've been affiliated with technology for 40 years, but the decade before coming to success, I did turnaround work. I helped distressed small companies and what I learned was a borrowed some business human around a concept called theory of constraints. I borrowed it from manufacturing and I applied it to the service industry. In theory of constraints is kind of the essence of having too much of everything because we don't have unlimited capacity to serve our clients were naturally have a bottleneck somewhere inside our company. And if we understand what that bottle neck is and we can have enough capacity so that it doesn't impact our customers. So the fact that we can tell any prospective client that we have enough capacity to meet their needs, irrespective of how many other clients we have, that's a powerful message. So whether it's something that's been sold or it's literally an opportunity that falls out of the sky, we have the capacity to mobilize and deliver on the promise we make to that client.
Question: How do you know when you need to add additional technicians?
Bruce Lach: We're a little countercultural, um, but because we have excess capacity, that excess capacity is what we would call a buffer. We have some buffer capacity and the number of times we enter, we consume that. Let's say instead of adding two to three new clients a month, we have a banner month and we add seven. Well that's, that kind of absorbs that capacity. What's the frequency of absorbing that excess capacity? That's a signal. So if it happens once a quarter, no big deal, we can all scramble to handle that. If it happens once a month. And yeah, start thinking about. But if it becomes more frequently than that, that's a clear sign. You need capacities. So the traditional measure of utilization isn't often very good because people will expand their work to fill up the time. I mean, that's classic Parkinson's law. So I've looked for other measures and it usually relates to the value delivered to your client, how often you are asking for that capacity to serve a client promise or client need. And if you don't have sufficient capacity then it's a frequency of you asking for that extra work that is your signal for more capacity.
Fred Alonzi: Well, always it's a, you're listening to your customers. The most important thing and the customers are telling us, and we can certainly with our technology, we can tell if we're falling behind in our outstanding tasks or in our, you know, our call logs for our phone system. Uh, I think it's a fairly basic formula for, for, for people now that, uh, once we see the growth of calls or growth of emails, requests, it's time to look forward. Luckily again, with managed services, we have the benefit of having a longterm contracts with our customers. So we don't have a lot of the pitfalls of some people saying, well, I'd like to hire somebody, but I'm afraid business might fall off. It really doesn't happen with managed services if you're, if you're managing your contracts properly. So we've been able to do steady growth. Obviously we're not the largest company on the block, but we've been steadily growing for 10 years, we add people every couple of years as necessary.