How MSPs are pivoting to meet client needs in a post-pandemic world

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For many of us, the word “pivot” became a standard part of our vernacular in 2020 as we dealt with unprecedented change in our business and personal lives. With countless numbers of businesses forced to shift their employees to a remote work paradigm — and many unprepared to do so — managed service providers became saviors.

Gone are the days of providing customer support in traditional areas such as break/fix, onsite support, hardware maintenance, and maintaining on-premises servers. In the ensuing months after COVID-19 began in March 2020, many channel firms helped their clients shift to the cloud to enable remote work and workforce management, IT security and backup, and disaster recovery.

Kaseya’s 10th annual 2021 MSP Benchmark Survey asked 1,000 owners and technicians of MSP firms in over 50 countries about how their business priorities have evolved, and the results weren’t exactly unexpected.

“Despite the pandemic, a sweeping majority (91%) of these MSPs recognize the importance of adding new offerings to their business to increase profits and revenue,” said Mike Puglia, chief strategy officer at Kaseya.

As in past years, the survey found an overwhelming majority (73%) of MSPs identified platform integration as critically important to their business to become more efficient and profitable.

MSPs must continue shifting their businesses to help clients adapt to the demands of a changing workforce that is expected to be a hybrid construct in many organizations.

Some partners are already set up to deploy remote work offerings with PSA and RMM tools. Others, who serve hard-hit industries like hospitality and entertainment, are looking to help them rebuild revenue. Partners will be called upon to help clients strategize and rethink their business models to get revenues back to where they were pre-pandemic.

It’s all about staying secure

With high-profile security breaches like the Colonial Pipeline and SolarWinds hacks dominating the news, it’s not surprising that foremost on the minds of some MSPs is adding security services to their arsenal. For Georg Dauterman, president of New York-based Valiant Technology, the biggest pivot has been to focus on fundamental IT security as a key value-added service.

“It sounds basic, but many providers were not really looking at end-user security and there was a big rush to get people working from home last year, and it’s a much more dangerous situation than you’d think at first blush,’’ says Dauterman, who clients are in the creative industries. “All these machines used to live inside the perimeter and you could control that to some degree.”

Dauterman started with compliance as a managed service because he felt his customers “needed to be prepared from a policy perspective. Many MSPs focus on tools but security is very much a human problem -- not a computer problem,’’ he says.

Valiant’s approach has been to work with customers on their security policies and build them cohesively and collaboratively so it works for their business. Valiant is developing security roadmaps for clients and relies on the NIST framework, which is tailored to clients based on their needs.

“A lot of data shows that if you’re doing the basics well, that will protect you fairly well and if there is a breach you’ll be prepared for that,’’ Dauterman says, as opposed to putting in tech solutions “with huge, gaping blind spots.”

To prepare for this new business offering, some Valiant team members received internal security training so that Dauterman could build a “non-MSSP security practice.” Dauterman himself received his CISSP certification during the pandemic.

He has brought in external partners to deliver SOC and SIEM services. Dauterman had considered obtaining security certifications for himself and staff members prior to the pandemic, but it became less of an abstract and more of a need-to-have last year.

He decided not to go full-throttle into offering these services internally, though, because “we learned if [security is] not going to be your primary focus,” you can’t compete against the bigger security firms. “No matter how good your team is … they have massive investment behind them. The key here is knowing what you do really well and focusing your efforts on that.”

For Valiant, it was understanding the unique needs of marketing and communications companies and applying them to the current cyber landscape and cloud needs.

A more consultative partner

Probably the single biggest pivot Valiant has made is segueing to a more consultative MSP relationship rather than just patching machines.

Dauterman is looking into SaaS application management as another practice area to develop to gain a deeper understanding of where and how customers use SaaS applications. That way, he reasons, Valiant can help optimize their experience and “go beyond provisioning an Office 365 email box and calling it a day.”

It’s never been more critical for partners to become trusted business partners so their clients don’t view them as a commodity. Specializing, as Dauterman has done, will help differentiate you from the competition. If you work with small doctor practice, it’s a good time to develop HIPAA compliance reporting services.

There is a greater need for compliance services, according to the Kaseya survey. A majority (approximately 70%) of MSPs agreed that their clients struggle to meet compliance requirements. However, only about half of MSPs surveyed provide compliance services currently.

Other value-added services

Beyond the challenges brought on by the pandemic, wildfires and winter storms impacted business continuity in new ways. The majority of the MSP (75%) respondents in the Kaseya survey said they used a combination of local and cloud backup for their data. Less than a quarter (19%) were relying on cloud backup alone.

Another outcome of the pandemic is a huge jump in the number of MSPs backing up their clients’ public cloud SaaS applications -- like Office 365, G-Suite and Salesforce – with nearly 70% of MSPs now providing this service compared to only half in 2019, the survey said. As a result, 54% of MSPs reported an increase in cloud management revenue last year.

This jives with a recently released survey by Altaro, which found that 87% of MSPs are increasing their Microsoft Office 365 business as a result of the pandemic.

As industry dependence on cloud-based software and other connected technologies grows, managed service providers have a significant opportunity to develop and leverage niche expertise to help their clients.

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