Random Thoughts on Social Networking for Managed Service Providers

This blog has the potential to be very upsetting to some people but I believe it is an important topic that needs to be discussed in the public domain. I am particularly interested in hearing from MSP's and vendors out there who use social networking for either their personal or business lives. While my own views on the subject have been relatively settled, I do welcome ideas from others to inform my own opinions, not to mention the countless thousands who are part of the MSPAlliance.

The role of social networking sites and technologies has changed rapidly in the last few years. Just the other day I was watching a major network news broadcast and they displayed two social networking sites prominently on the screen. Social networking has become an accepted way of interacting with friends, family, and business colleagues in an era where virtual communication is now the norm. The purpose of this blog is to ask the crucial question: does social networking risk long term harm to your personal or professional reputation? Let's consider some specific issues that are of particular interest to individuals and companies engaged in the practice of managed IT services.

Professional Appearance: most social networking sites do not specify between work and personal life. Speaking personally, I have had numerous colleagues tell me that they would rather connect with me (yes I use some social networking sites) on one site versus another site. To me this says there are some sites that are less useful for business networking than others. Some of you might say that the blend of personal and business is inevitable and actually useful for business networking. The question all MSP's must ask themselves is what professional appearance do you have to your clients and colleagues when you appear on personal social networking sites?

Security: For those of you in the IT security sector you will no doubt know that social engineering has been and continues to be a major threat to companies and individuals everywhere. MSP's who advise their clients on matters related to IT security should be aware of the potential dangers of allowing social networking sites to be used by employees (both working for MSP's and clients). Just as MSP's advise clients to have HR policies prohibiting online day trading and shopping, so are social networking sites potential hazards for employees. Too much information can be disclosed about a person or their business through such sites. Daily habits, friends and relatives, common hangouts, favorite watering holes, all represent potential information that can be used against individuals or their employers. If your clients do not have IT usage policies for social networking you should have that discussion with them.

Benefits versus Costs: There is no doubt that social networking can get your name and brand out there very quickly. Think of it as marketing at the speed of light. But does this instant exposure come at too high a price? To use many social networking sites effectively requires a fair amount of time. Speaking personally, I tried social networking and found that there were some very fast benefits coming chiefly in the form of exposure to a wide base of potential colleagues. I did find myself spending way too much time on these sites and my productivity suffered. If your clients don't want their employees playing around on the Internet during work hours, social networking sites should be high on your list of items that should be prohibited.

Privacy: Social networking sites, by their nature, expose a great deal about you and your life. Unfortunately, this can include information about your work as well. While getting your personal name or business exposure, make sure it is the right kind of exposure. Think about how many clients are seeing you and what types of opinions they are forming when they see al the information you post. Your privacy may not be worth the trade off.

In the end you must decide what these types of technologies get you and what they cost. More importantly, if you are an employer you should probably know what your employees are saying about your company on social networking sites. For MSP's, the implications could be even more grave. Clients look to their MSP's to be advisors and trusted confidants. Before you make that next posting on a social network site, think about what benefits you receive and what the costs are. You may find that the scale isn't that even.

How do your clients view your managed services practice?

For those of you who do not think that there is a lot at stake in the world of managed services I hope this blog changes your mind. Every once in a while I come across someone who tests my faith in this industry. I had a couple of conversations like that this week. For those of you who know me you know that I believe in the managed services profession. I believe that managed services has a very important role to play in our global economy. It is because of this belief that I get concerned when I see certain behavior in the channel. My concern comes from my hope that these individuals do not implement policy or represent the majority view of MSP's today.

There are two types of companies in the IT channel today. First, there are technicians who happen to run fairly straightforward technical talent for hire operations. What I mean is they take an hourly fee and multiply it by the number of hours they bill a client. Pretty simple. I would also mention that this first group generally does not possess the qualifications to advise clients on business matters that happen to involve technology. The second group are businesses that happen to be engaged it the delivery of IT goods and services. Making matters slightly more confusing is the fact that group 2 has some owners who are technicians, but they also have a strong business sense.

The confusion that results occurs when end-users encounter both groups who claim to be part of the same industry, claiming to do the same things, but they end up with different results. I hear so many MSP's tell me that they are tired of going into a client after another IT provider has a messed up the network. At a time when managed services is becoming a part of the mainstream, quality control and high levels of customer satisfaction are very important.

The next time you find yourself going into a client who has had a bad experience with an "IT solution provider" do yourself and your colleagues a favor and tell them the difference between technicians and IT professionals. Your profession will thank you for it.

Winning Managed Services Deals Through Ethics?

This next story is just too good to not share with all of you. Every once in a while somebody calls up and asks the question "can the MSPAlliance help me close more business?" I usually have a standard response to those people but from now on I'm going to be referring them to this blog.

One of our members emailed me saying that they recently closed a managed services contract because of the Managed Services Code of Ethics & Conduct. Now I must admit that at first I was a little skeptical when I read this so I called up the company and heard first hand what happened. It turns out the MSP was bidding a job and had been talking to the owner of the company about their qualifications. The usual technical vetting process took place and everything seemed to check out. The client was getting replacing an internal IT provider with a MSP and the question of client satisfaction became an issue.

When they heard this the MSP told the client that included in the stack of materials provided was a copy of the Managed Service Provider's Code of Ethics and Conduct. He continued by saying that MSPAlliance members are held to a higher standard and that the client should expect no less of him. I guess that was enough for the client and they signed the deal.

This is a great testimonial of how, if used effectively, membership with an association like MSPAlliance can pay off. Clients are much more likely to trust you if you are an affiliated company rather than one who is off on your own and beholden to no one.

This should be a lesson to all our members that using a little old fashioned integrity and non-technical relationship building can go a long way in this profession.

Is Managed Services Over Used?

This might seem like a funny title for a blog coming from me but I hope it will make sense by the end of the article. Of all the people who are questioning the use of the term "managed services" today it is the mature MSPs who are most vocal. I believe they are vocal about this topic because they see a lot of young companies entering managed services and they worry about how they will care for the name. This is perfectly legitimate concern. To preserve standards and reputation of a profession is a natural instinct. However, to through away a term solely because it is at risk of being tarnished would, I believe, be an unwise decision.

When other professions come under attack (from without or within) there are any number of protections that can be implemented. Regulation (self and public), corrective marketing, and education are all effective methods for professionals to protect their trade from newcomers. What is never done successfully is for a profession to abandon the words/terms that describe them just because those words are being abused.

For example, when the attorneys had problems with "ambulance chasers" they didn't convene a committee and decide to call themselves LSPs (legal service providers). What they did was increase educational requirements and impose self regulation to prevent unsavory practices that would otherwise tarnish their profession. Nobody has successfully argued that doctors change their name whenever they make a fatal mistake on a patient. Internal self correction and policing are methods almost always employed when professions want to protect against dilution.

What is happening in the managed services profession today is not all bad. We have a continuation of the massive transition of VARs into MSPs that started several years ago and some of the mature MSPs are wanting the standards to remain high. There is nothing wrong with wanting high standards for young MSPs. The problem is when old MSPs begin to abandon the powerful marketing that is finally theirs to enjoy. MSPs are finally gaining the recognition they deserve…why change names now?

Managed Services Spending To Increase in 2009 - but don't get too excited

A recent Insight Research study says that managed services spending should continue to increase at a rate of 8% for the next five years. No surprises here, the study indicates that the current economy may actually have a positive impact on the managed services industry because companies tend to view "outsourcing" as a good choice for reducing operational expenses. For anyone who doubts whether the managed services market is really as healthy as it is, I would hope that this data would convince you. I've been posting at least a half dozen of similar reports for the last few months all indicating roughly the same thing: managed services is doing quite well.

While this is great news and everyone in this industry should be thankful for it, I would caution against being too comfortable as there is still a lot of work to be done, especially with all the new companies entering the MSP profession. The economy, while being very good for MSP's, is having the opposite affect on break/fix VARs. By the thousands companies who have made their living on reselling and reactive IT services are making the transition into managed services. Even those companies who had started the transition a while ago are feeling incredible pressure to offset reseller revenue losses with recurring revenue streams. Now, this is where it gets tricky.

I've long believed that the demand for managed services is still greater than the number of qualified MSP's available to do the work. Assuming that this is true, the number of new "MSP's" is likely to have a diluting effect on the quality of services in the next year. Two potential problems will need to be monitored very closely. One, end-user expectations and education will be critical. A loss of confidence in the managed service provider profession at this stage is to be avoided at all costs! Two, education and proper training/certification of MSP's will help moderate their expectations about the profession and help keep them on the generally accepted path towards managed services excellence.

We are already seeing evidence of end-users identifying fake MSP's and wanting a change. Let's not disappoint them!

Don't sell in a down economy, deliver value

Never before have we been in an economy where it is more important to distinguish yourself from the rest of the crowd. I've heard a lot of people talking about how to sell managed services in a down economy and my honest view is this is not a good approach. At least for the foreseeable future, managed services should be about delivering value in IT, controlling costs, and improving efficiencies, not about selling a solution. Here's why I think this way.

In today's economy businesses are searching for ways to become more lean and efficient. Company's are desperately trying to find ways to cut costs and extract more out of what they already have. The notion of "buying" something just isn't in their vocabulary right now. Some of you might be wondering why I'm saying this when managed services is expected to grow by 20% in 2009. Well, I believe we will likely hit that 20% growth mark (we might even exceed it). But I don't believe MSPs will be successful in 2009 if they persist with the same VAR mentality of selling a solution to a business. Businesses want to know that you are helping them bring their expenses into alignment, not that you are trying to sell them something. Clients want advice on how to maintain their IT without letting expenses get out of hand.

So, the next time you're on a "sales" call with one of your clients, try talking to them about how managed services can help them save money this year. They might actually thank you for such advice. I'd be curious to hear how some of you are dealing with your recent "sales" calls and how clients are reacting to the economy.