MSPs vs. VARs: Which one are you?

Many of you who have heard my views on the IT channel know that I place great stock in the value of words and what they mean. Nothing could be more true than my views on channel terminology. There is a great blog written last week about the different views being expressed about our industry. On the one hand, much of the data seems very bleak; IT spending forecasts, consumer and channel confidence, and other solid data seems to be very accurate. On the other hand, MSPs are testifying to a much different experience. MSPs are describing very hectic and profitable times, presumably as their clients attempt to cut their own internal IT costs and hand off more to their trusted managed service providers.

Why the dichotomy? There are two differing viewpoints being offered here and both are correct. The confusion occurs when the IT channel applies two words (MSP and VAR) and couples them with the same meaning. This is why people are confused when they hear MSPs doing so well and VARs having a rough time. Never before in the IT channel has the difference between MSP and VAR been so stark. As more MSPs strive to add more services revenue to their mixture, they are both increasing their business stability while at the same time insulating themselves from declining product sales. It is worth noting that MSPs have also increased their leasing activities, presumably to better cope with clients who need to spread out payments for services, products, and projects.

It's entirely possible that MSPs are lying to us and giving a lot of false data. I don't think this is true since I'm talking to MSPs who I trust and they are all giving the same story. Even the international MSPs are making similar reports.

The next time someone tells you the IT industry is not doing so well, may sure you know to whom you are speaking. They might be a VAR.

Happy Holidays from MSPAlliance

The MSPAlliance wishes all our members and colleagues throughout the world a very happy holiday season. Thank you for your support over the years. We wish you a very happy and prosperous new year!

Basic Legal Protections for your Managed Services Practice

First the bad news. There are still a lot of MSPs who are in danger because they have not taken a few simple steps towards protecting their managed services practices. These companies are largely unaware of the peril they face each day by not having basic legal documents that can provide a wide range of protection. Now the good news; help is available and very easy to find. The following are just a few of the ways MSPs have left themselves exposed legally.

I have always been amazed at how some companies can do business on a handshake and still feel safe. I remember one company actually said they never had their clients sign contracts because they wanted the client to trust them. It's good to want people to trust you but not by leaving yourself exposed without a contract.

Template service contracts have been floating around in the channel for a long time. If you use a template in your managed services practice you may not be protected. Think of it this way. Templates are generic documents that only work if they are customized to fit. A template SLA was never written for your company, doesn't take into account your unique business characteristics, and therefore, cannot provide you with adequate legal protection. If you have a template SLA or other legal document, you should have it reviewed by an attorney.

There are a lot of potential threats facing MSPs today and the stakes are very high. Whether you need a contract reviewed or you need some advice about your managed services practice, you can call our legal hotline (www.mspalliance.com/legalhotline) and talk to an attorney who specializes in managed services law. Don't let your practice remain at risk.

Managed Services Practice Groups

I have been noticing a trend within the managed services professional community that is picking up momentum. Actually, this trend has been occurring for a long time but only now is it really beginning to become an accepted and useful model for MSPs. I am referring to managed services practice groups.

Think of medical practices or legal firms; small groups (sometimes large) of like minded professionals who band together to form a single source of services for their patients and clients. By combining the talents of a group of individuals (or in this case, managed services companies) the "firm" has a much broader reach in terms of expertise and resources.

Recently, I've been hearing about MSPs who have untapped resources banding together to make more efficient use of their talents. Sometimes in the form of an underutilized help desk or NOC, a partially filled rack in a data center, or maybe just an extra pair of hands, MSPs are realizing that their strength in numbers can yield powerful results. During a time when everyone is being extra careful about expenditures, letting resources go unused is a waste.

Considering that this practice has been in use for decades in other professions, it seems only natural that the managed services profession also follow suit. After all, in difficult times, strength in numbers can be a very comforting thought.

What does it mean to be a neutral MSP?

Last year I gave a series of talks about the importance of being a good MSP. This wasn't the typical speech on why you should become a MSP. Rather, it was on the virtues of being a good MSP.

One part of the speech was on neutrality and the importance of MSPs being independent advocates for their clients. As our economy puts unusual pressure on all of us, it is more important than ever for MSPs to be providing independent advice and service to their clients. I am getting very suspicious of all these new companies touting themselves as "trusted advisors". I wonder how many of these companies actually provide advice that is free from influence from a vendor or third party.

What I tell all end-users is to have a checklist based on the Consumer Bill of Rights. These are very easy to follow rules and they will steer you in the right direction as a MSP. MSPs are neutral! Don't ever let anyone convince you that you shouldn't be neutral. With so many companies trying to enter the MSP profession, neutrality and independence will eventually become one of the defining characteristics of all true MSPs!