As the saying goes: If you’re not planning, then you’re planning to fail. In this blog, Stefanie Hammond looks at why business roadmaps are more important than ever to MSPs.
Here at N-able, we have identified three key market segments that today’s MSPs fall into: Emerging Market, Growth Market, and Elite Market.
What we are starting to see happening among these three tiers is a growing disparity developing where MSPs will need to make difficult decisions about the future and how they should be moving their business forward in the years to come. Unfortunately, if MSPs fail to address this growing market disparity, they are going to be left behind.
In reviewing industry news, you have likely seen a fair bit of M&A activity going on. ChannelE2E reported that in 2021 there were over 830 M&A deals that occurred and, as of January 2022, another 80+ deals have already been announced. Much of this M&A activity is being propelled by those MSPs who know where they want to take their business and who want to have a hand in shaping their own destiny. It is these MSPs that are actively engaged in the M&A activity today, and this is causing them to pull ahead of their closest competitors.
So, what can MSPs do to help close this chasm that has been developing in the industry? Ultimately, MSPs need to focus on three key pillars of their practice to drive business excellence and help reduce this gap. This involves:
1. Having a focus and a direction
As an example, if you don’t have a center of excellence in terms of your direction—i.e. if you don’t have a business roadmap in place for your MSP that documents your priorities and your actionable plans—you not be able to identify where new opportunities may lie for you in terms of future revenue and sales growth.
2. Having your MSP structured in a way that drives efficiency
Looking at things from the efficiency side, how you will manage the scalability aspect as you grow? How will you manage your levels of profitability? What are your costs? Where are your cost outlays?
Often while working with partners on their growth strategies, I’ll hear them say: “That’s too expensive,” or “We can’t afford that,” or “We don’t have time for that.” This is typically because they aren’t running as efficiently as they should because they are lacking good automation and standardization processes within their MSP.
3. Having a good understanding around what needs to be done to increase revenues and improve profitability levels to have sustained growth
The last pillar of excellence focuses on growth and all things sales. This requires you to analyze the growth trajectory your MSP is travelling and then assessing whether you are where you want to be today, and, if not, then why not? If you are finding that you are off course and not moving in the direction that you want to be, then you need to make plans to correct that. And that is where building a business roadmap for your MSP comes into play.
Here are four key reasons why you should implement a roadmap for your MSP:
- To create awareness, improve transparency, and drive accountability among team members. Having a roadmap that outlines your MSP’s vision, priorities, and deadlines will help keep everyone on your team be mindful of what you are trying to achieve and will help make communication easier among team members, as everyone will understand what their own role and responsibilities are.
- To benchmark your business year over year to see how your MSP is progressing. Are you meeting those targets and critical milestones you have set for your business? Or are you missing the mark somewhere? Only by setting a baseline and measuring your improvements against that baseline will you get the empirical evidence you need to assess how your business is really fairing.
- To align your growth trajectory to your initial vision. A business roadmap is your North Star—it is your compass. It helps to keep everyone on your team on the right path, working towards those common goals that you have deemed to be the most pivotal to your success. It will provide you with instant feedback and help you to refocus and rededicate your efforts should you run off course.
- To help protect your business. “A failure to plan is planning to fail.” Do you have the right skills and resources to reach your goals? If you don’t, what is the plan to source the expertise that you need? Or, what happens if you lose a key technical resource from your team? How will you cope? Will you still be able to manage and properly support your clients? Or will your service delivery suffer as a result? Documenting your goals and outlining what is needed to reach those goals will help you to identify cracks in your strategy and highlight what is needed to close those gaps.
If you have never created a roadmap for your MSP before and you are looking for assistance on how to get started, then I encourage you to register for my upcoming boot camp taking place March 22 called “Cracking the Code to Growing Your MSP”. I will be taking MSPs through the importance of developing a roadmap for their business and reviewing steps to improve your practice if you are finding that your compass is off course. There is still time to register and you don’t need to be an N-able partner to attend. Our head nerd boot camps are open to any MSP Business owner who is interested in spending time working on their business instead of in their business.