how to demonstrate msp it service value to your customers

8/14/2019 How to Demonstrate MSP IT Service Value to Your Customers

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From Promises to Proof: How To Demonstrate Value toYour Customers

Whitepaper

From Promises to Proof: How To Demonstrate Value to Your Customers

Table of Contents

Executive Sum mary ..... 3

The Value of Reporting... .. 5

Flexibl e Reports for Diverse Audi ences ... ... 5

Executive-level reports ... . 7

Operation-level reports... . 7

Technician-level reports ... .. 8

N-compass: Demonstrating the Business Value of Managed Se rvices ... . 9

Track Metrics that M atter Most... .. 9

A Sim ple, Efficient Reporting Architecture... ... 9

Four Comprehensive Analysis Features ... ...10

Better Information = Greater Value... ...12

Conclusion ... ..13

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Executive Summary

Managed services is one of the f astest growing sectors of the technology industry . This trend towards morepredictable, proactive IT serv ices is providing tremendous opportunities to IT serv ice providers, particularlythose targeting the small- and medium-sized business (SMB) market.

This mov e towards managed serv ices is occurring f or two reasons. VARs, sy stem integrators (SIs) and ITservice providers are under severe pressure f rom high customer turnover, low technician utilization rates andshrinking margins to change the way they do business. As a result, more and more IT serv ice providers aremov ing away f rom time-based, break-f ix serv ice models and transitioning to managed serv ices v alue-basedengagements that provide predictable and proactive business-f ocused IT services.

The second impetus in this t rend has been SMBs. They want I T service prov iders that can deliver betterservices, more eff iciently, and can help mitigate compliance and security risks , all at more predictable costs.And because SMBs make up 48 percent of ov erall U.S. IT spending, according to a recent Forrester report,they wield considerable power. By 2007, Forrester expect s SMB spending to eclipse enterprise IT spending.

The challenge with managed serv ices, though, is that while they of f er customers true value by seamlesslyf ixing problems before they impact a customers business, demonstrating and proving this v alue hastraditionally been problematic. The simple reason for this is that many of the aspects of managed services aredelivered in an automated, behind-the-scenes f ashion; c ustomers dont see what it takes t o keep their business

running smoothly .To combat t his problem, MSPs must regularly report their activ ities and successes to managers at all levels ofthe customer organization technician, operations and executive as well as to authorities outside theorganization such as auditors. While each audience cares about dif f erent iss ues, they all need to understandthe v alue that managed services provides both on a daily IT basis and f or a companys long-term operationaland fisc al health. Such reporting needs to be f ully integrated and f lexible to ensure that dif f erent managersreceive the information that matters most t o them in a format that is both informativ e and actionable. Whensuccessf ul, a consistent reporting eff ort can literally transf orm a customers perception of managed serv icesf rom a v endor who promises v alue to a partner who delivers v alue.

While most reporting solutions targeting MSPs are f ocused on operational technical reports, one solutiondelivers the reports needed by the dif f erent s takeholders in the organization. N-compass MSP PerformanceReporting solution f rom N-able Technologies prov ides extensiv e reporting capabilities that allow y ou toleverage predefined IT serv ices, m anaged VoIP and security reports, incorporate data from m ultiple sourcesand create unique customer reports. The ability f or an MSPs customer to easily v iew and understand ITperformance data helps them make better, more informed decisions f or the successf ul operation of t heirbusiness. Also, by showing customers that their IT infrastructure is perf orming at an optimal lev el under theMSPs management, customer satisf action increases - and, most importantly the MSP has the history and

credibility to take on the role of t rusted advisor.

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Getting More from Managed Services

The Move to Managed Services

As a business and service delivery m odel, managed serv ices is revolutionizing the way VARs, sy stemintegrators, and IT serv ice prov iders are doing business. A desire to deliver predictable and proactive,business-f ocused IT services, rather than relying on the traditional reactiv e break-f ix serv ice approach, isprompting more IT service companies t o transf orm themselves into true MSPs.

For most MSPs, the f astest-growing source of new customer accounts is t he small- and medium-sizedbusiness market. According to Gartner, the SMB IT serv ices market was estimat ed to be worth $220 billion(USD) in 2003 and is expected to grow at a compound annual growth rate (CAGR) of 7.6 percent f rom 2004 to2008. A recent study by Forrester cited the SMB market at 48 percent of the overall U.S. I T spending, st atingthat it will surpass enterprise IT spending by 2007. And channel partners-the v ery companies t ransformingthemselves into MSPs-influence more than 90 percent of IT purchasing decisions in the SMB market, whichtotals $374 billion.

But thats not t o say that the SMB market f or traditional hardware and software sales is a guaranteed source ofinstant profit. I n the increasingly competitiv e race to attract SMB customers, IT serv ice providers find they mustcut their prices. The price of commodity hardware is plummeting, so VARs, SIs and others have seen theirprofit m argins s teadily wane. This has f orced MSPs to lean more on their service of f erings, t hus changing their

business model.

Theres also pricing pressure on the serv ices s ide. New market entrants, trunk slammers, Telcos, the bigboys, and point solution providers are undercutting prices on delivering reactive serv ices. And because mostIT service providers have time-based engagements with their customers, instead of ones that are v alue-based,they f ail to establish tight bonds with customers the kind of bonds that protect them from losing lucrativeaccounts to lower-priced competitors.

This increase in competition has f orced many I T service organizations to ev olve and mature in order toincrease their productiv ity , eff iciency, service levels and market diff erentiation.

The Irony of Managed Services

With the help of t he business t ransformation serv ices dev eloped and delivered by N -able Technologies,hundreds of MSPs have ev olved their businesses beyond the strictly reactiv e, break-f ix model to one thatproactiv ely anticipates and prevents f ailures. More than 900 MSP partners rely on N -able solutions to delivermanaged serv ices to more than 30,000 customers worldwide.

Solutions like N-ables N-cent ral remote monitoring and management (RMM) platf orm have helped thesecompanies track the status of their customers ongoing IT operations. RMM solutions provide notifications and

reports about specific incidents, dev ices and services that can impact ov erall IT perf ormance and themanagement tools to remotely remediate these issues. RMM solutions like N-central are invaluable guides totelling the MSP where to prioritize its attentions to ensure that problems are mitigated as soon as, andsometimes before, they occur.

But a success f ully implemented and maintained RMM solution may result in unintended consequences f orMSPs. A well-designed RMM platf orm can so ef f ectiv ely keep problems at bay that operational and, especially,executive personnel may lose sight of the v alue that MSPs prov ide. Even if a problem does occur, it is of tenf ixed remotely with little or no impact. The customer may not even know that a problem had occurred.

In the break-fix model, the customer calls t he service provider when they have a breakdown. The prov idersends out a technician to f ix the problem. The customer recognizes the problem and sees the technician f ixingthe problem, so there is no overlooking or f orgetting the pain and the v alue delivered.

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When IT problems are so well managed that they rarely reach the radar screens of C-level executiv es, t hepain once caused by regular IT failures is quickly f orgotten. Indeed, the irony of managed services is that ajob well done may cause customers to wonder just what theyre paying f or. And as the service deliv ery getseven sm oother and more sophisticated, the less v isible the value becomes.

The Value of Reporting

For MSPs st riving to build lasting, loyal relationships with their SMB customers, the importance of illustratingthe v alue they bring has never been greater. In other words, properly communicat ing the genuine value of MSPoff erings can reveal the savings that y our serv ice is prov iding f or your customers every day: like reduction insecurity risks, elimination of emergency IT services or a reduction in costly server down time.

Todays end customers arent really interest ed in knowing which components make up their IT inf rastruc turebut they are very concerned with how the sy stem as a whole performs. Poor performance or any degradation ofresponsiv eness will often lead end customers to f ind a new serv ice provider. To retain these customers andattract new ones, MSPs need to distinguish their service by ensuring they can deliver high-level performance.

The challenge f or the MSP isnt just delivering a high-level of performance; its also demonstrating its v alue.MSPs create v alue very diff erently f rom the ty pical break-fix approach by continuously monitoring the endcustomers environment and proactiv ely f ixing incipient problems. Most value-creation activ ities occur off siteand so are not v isible to the SMB decision maker; unlike the break-f ix approach where the technician is alwaysonsite and theref ore visible. This is why serv ice level agreements (SLAs) and scorecard v iews are critical to anMSPs success.

SLAs are contracts between serv ice providers and customers that define and outline:

The scope of work to be prov ided

Acceptable and unacceptable service levels

Problem management actions

Compensation

Customer duties and responsibilities,

Warranties, legal compliance and resolution of disputes

Terms and conditions f or termination.An SLA protects t he MSP by defining the level of serv ice to be delivered and stating explicitly how this will bedone and under what terms and conditions. SLAs also def ine the business v alue the customer expects in t erms

of iss ues like av ailability of key business sy stems. The MSP can then use these key metrics as the basis todemonstrate the v alue delivered. Scorecard v iews t hen report against the def ined perf ormance.

Flexible Reports for Diverse Audiences

To communicate y our value, nothing is more ef f ectiv e than well-designed reports that target the audiencesmost concerned with gauging a company s return on IT invest ments. While every company wont have allaudiences, reports should be directed at f our primary groups: executiv e (such as business owners or C-lev elexecutives); operational (including line of business v ice-presidents and directors); technician (or hands-on ITpersonnel); and external (like auditors f or security ).

Depending on the target audience, reports should answer common customer questions, including:

Is our inf rastruct ure supporting our business goals as defined in the SLA (both operationally andstrategically)?

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When it doesnt work, are we getting the service that we are paying f or?

What do we have to do to keep it working?

How can we minimize cost impacts?Reports must also take into account the context of the data, such as a baseline to understand what thenumbers mean. A baseline is an external standard by which y ou can compare and trend y our data. This allowsan MSP to compare a customers one-month call activ ity against t heir 12-month running average, f or example.Trended usage levels like these help support purchase requests and budget forecasting. Baselines also allowMSPs to compare key business service av ailability against t he average for all customers t o show a customerhow they compare to the average.

Figure 1 N-compass Firewall Incident Trend Report

As the table below illustrates, dif f erent reports can address dif f erent lev els of concern. At the highest lev el,reports should provide a broader scope of activ ities and results, with a longer-term v iew of trends and costsav ings. As the audience grows m ore technical, reports should feature more granular information that armstechnic ians with actionable information capable of prompt ing more immediate response.

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Strategic Tactical

Executive Cost of downtime

N/A

Strategic planning

Relationship buildingOperations

Reporting against SLA Summarized activ ity reports

Validate current spending Incident reports

Budget planning Security activity reports

Capacity and growth Recognize short-term threatsplanning to business activity

Technical N/A Detailed reports

Specific incidents

Designed to guide immediateactivity

Executive-level reportsThese can speak to iss ues that hit an organizations bottom line and address a company s ability to serv e itsown customers while dovetailing with overall strategic goals. F rom an MSPs perspectiv e, these reports shouldhelp drive f uture spending on MSP off erings. Ov er time, they can be used to build a business case f oradditional customer investment in y our services. Executiv e-lev el reports might include:

Analysis of costs by business service. How can we improve our business through the use oftechnology?

What if scenarios. How would investm ent in this area impact downtime costs ?

Comparison to baseline. How do our failure areas or cost categories compare to that of ourcompetitors, or to our historical averages?

Operation-level reports

These should include inf ormation that illust rates how operations personnel can v alidate current spending andavoid short-term risk. These personnel are consistently evaluating whether or not they are receiv ing the level ofservice f or which they are paying. They are keenly interested in such metrics as success or failure of certainobjectiv es (as def ined by the SLA), summ arized activit y levels or trended usage levels t hat might supportpurchase requests or budget f orecasts. Operations-lev el reports might include:

Service lev el reports. Are we succeeding or failing on certain objectives as def ined by our SLA?

Summarized usage reports. How do our activ ity levels or usage trends impact purchase requests orbudget f orecasts?

Short-term recommendations. How do current-vs .-historical costs inf luence our plans f or f uture capacityupgrades?

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Technician-level reportsThese reports should prov ide data that help inform imm ediate IT needs. Technicians care most aboutinformation that allows t hem to clearly prioritize tasks . As a result, technician-level reports tend to includegranular, specific information:

Notif ications

Detailed reports on specif ic incidents / devices / services

Short-term trend reportsAs we have seen, diff erent audiences seek out and require dif f erent inf ormation to assess t he value of anMSPs off erings. But to communicate value in the most ef f ectiv e way , reporting tools must be f lexible. Forinstance, in the SMB market, executive and operational concerns m ay be addressed by a single audience. Toprovide the right mix of information, MSP solutions should of f er integrated reporting so reports c an becustomized, dif f erentiated, informativ e and interesting.

While most MSP management tools lack these f eatures and level of integration, N-able Technologies hasdeveloped a solution capable of helping elev ate MSPs to the cov eted role of a trusted advisor.

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N-compass: Demonstrating the Business Value of Managed Services

Track Metrics that Matter Most

There is one solution that provides the of f line business reporting MSPs need to demonstrat e to customers thebusiness v alue of managed serv ices: N-able Technologies N-compass Perf ormance Management solution. N-compass enables y ou to report on key serv ice performance metrics such as uptime, capacity , and security,allowing you to demonstrate the true value of the services y ou prov ide.

N-compass prov ides extensive reporting capabilities that allow you to lev erage predef ined IT services,managed VoIP and security reports, incorporate data f rom multiple sources and create unique customerreports. The ability f or your customers to easily v iew and understand IT performance data helps them makebetter, more informed decisions f or the successf ul operation of t heir business. Also, by showing customers that

their IT inf rastructure is perf orming at an optimal level under your management, cust omer satisf actionincreases and you take on the role of trusted advisor to y our customers.

N-compass is highly integrated with N-central, the leading RMM platform deployed globally by MSPsservic ing the SMB market. Built on Microsoft SQL Serv er and the Microsoft Reporting Services engine, N-compass includes an of f line data warehouse and reporting infrastructure that prov ides extensive andcustomizable reporting capabilities without impacting t he data processing activ ities of N-central. Multi-serversupport allows y ou to collect data f rom multiple N-central servers and provide aggregated reporting on thebusiness v alue of y our managed services of f ering.

N-compass t racks comparativ e baselines, a running av erage gathered against customer inf ormation based ona given metric. N-compass can track perf ormance against any metric f or the purpose of business impact andpredictiv e analy sis to help y our customers make informed business decisions.

A Simple, Efficient Reporting Architecture

The design of N -compass is based on an of f line data warehouse. This warehouse is a uniquely designeddatabase optimized for reporting performance and ease of report development.

Leveraging industry -leading technologies f or data collection, transf ormation, and s torage and retrieval, the data

warehouse can gather data f rom N-central, aggregate it and make it available for reporting in a simple andeff icient manner. N-compass scorecard v iews quickly demonstrate to busy customer executives the businessv alue of theirmanaged serv ices and whether you are meeting or exceeding your SLAs.

By tapping the power of Microsof ts SQL Server Reporting Services, N-compass prov ides a simple-to-usereporting user interface t hat is seamlessly accessed f rom within N-central. This allows any N-central user toaccess N-compass reporting without requiring additional credentials.

All reports are branded with y our information and can be run on demand or scheduled for automat ic deliv ery .Delivery f ormats include Microsoft Excel, Word, Portable Document Format (PDF) and CSV.

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Figure 2 N-compass Architecture

Four Comprehens ive Analysis Features

N-compass includes f our important f eatures that can be leveraged to provide comprehensiv e analysis f or use inexisting or custom reports. The analysis based on these f eatures play s an integral role in helping y oudemonstrate the value of y ourmanaged serv ices of f ering. These f our features prov ide the critical missing linksto historical information, relevance and contract comparison that help y ou demonstrate the business v alue ofy our services while helping your customers executiv es make important strategic decisions.

Comparative baselines f or insight into current results. Comparative baselines prov ide the ability tocalculate data for other time periods or devices and use them to prov ide insight into the current results f or agiven dev ice or service. This helps to provide insight into the historical lev els of service and helps to justifyf uture costs such as f urther inv estment into a project. Baselines include historical and program-levelinformation, which provide comparisons against other customers and put results into context.

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Fig ure 3 N-compass Downtime Cost Impact Report

Cost of downtime - a critical investment metric. Cost of downtime is a critical measurement(?) to determinewhen further inv estment is required in key sy stems. N-central allows y ou to enter a cost v alue into ev eryservice group, a grouping of lower lev el IT elements that f orms a mission-critical business serv ice like email. N-compass uses this v alue to show how downtime, when aggregated over t ime, can cost a business.

Service level agreements - a summary of customer expectations. You and y our customers outlineexpectations in SLAs. These documents out line what serv ices will be rendered, what serv ice levels will beprovided, what recourse y our customer will hav e if they are not met, and what the cost of the services providedwill be. N-compass reports can demonstrate if y ou are delivering on y our contracts and meeting or exceedingy our SLAs.

Program lev els - comparison of av ailable MSP programs. Quite of ten y ou will have sev eral standardizedprograms that y ou market to your customers. N-central and N-compass support the subdiv ision of y ourcustomers into groups so that y ou can assign baselines, SLAs and other key information to them. This givesy ou the ability to measure service lev els on a program-lev el basis, allows comparisons across program levels,and allows y ou to assign standardized SLAs at each level mak ing reporting more relevant and easy t o use.

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Better Information = Greater Value

By regularly supplying the three key customer audiences with accurate, insightf ul reports, N -compass allowsy ou to realize a broad range of benef its.

Maintain and increase service lev els - Quickly create reports that ev aluate mission-critical businessservices such as email, network and security to ensure you are performing according to your servicelevel agreements.

Better plan customer IT inv estment - N-compass comprehensive trend performance, businessimpact and predictiv e analytical capabilities allow y ou to help your customers make better businessdecisions and plan future IT investm ents.

Increase technician utilization rates - Highly integrated with N-central, easy set up and configuration,auto-upgrade capabilities and predef ined reports lower your overall cost of serv ice delivery andincrease technician utilization rates.

Build the role of t rusted advisor - Take on the role of trusted adv isor and reduce the probability ofbeing displaced by eff ectiv ely managing your customers IT inf rastructure and measuring the resultsagainst serv ice level agreements.

Better dif f erentiate yourmanaged serv ices of f ering - Strengthen and diff erentiate y our managedservices off ering by providing your customers with more reporting capabilities that demonstrate thebusiness v alue ofmanaged serv ices.

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Conclusion

ForMSPs aiming to serv e small- and medium-sized businesses, the ability to capture and retain lastingcustomer relationships is proving to be a determining fact or for long-term profit ability . Only by clearly andconsistently communicating your value to y our customer can you hope to attain the role of t rusted adv isor-aposition that will help protect y ou f rom losing business to lower-priced competitors. An integrated, of f linereporting solution such as N -compass f rom N-able Technologies can ensure that y our customers alwaysperceiv e y our value in the ways that matter m ost to all managers within the customer organization. With N-

compass, ev eryone understands your v alue, so y ou can f ocus on delivering even more to your customers inthe future.

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Disclaimer

This executiv e brief m ay include planned release dates f or service packs and v ersion upgrades. These datesare based on our current development plans and on our best estimat es of the research and development t imerequired to build, test, and implement each of the documented f eatures. This document does not represent anyf irm commitments by N-able Technologies Inc. to f eatures and/or dates. N-able will at its best ef f ort, try to meetthe specif ied schedule and will update this document should there be any significant changes. N-able reserv esthe right to change the release schedule and the content of any of the planned updates or enhancements

without notice. Publicat ion or dissemination of t his document alone is not intended to create and does notconstitute a business relationship between N-able and the recipient.

N-able Technologies is a market driv en organization that places importance on customer, partner and alliance

f eedback. All f eedback is welcome at t he f ollowing email address: f [email protected] .

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About N-able Technologies

Founded in March 2000, N-able Technologies is the market leader in transf orming serv ice organizations intomanaged serv ice providers (MSPs). N-ables combination of products, people and processes help serv iceproviders, develop, sell and deliv er highly profitable managed serv ices to the small- and medium-sizedbusiness (SMB) and mid-enterprise markets. N-ables product line provides complete s olutions to m onitor,

manage and optimize information technology and security f rom a business perspectiv e to ev olve IT serv ices

f rom reactiv e to proactiv e to managed. www.n-able.com

Copyright

Copy right 2006 N-able Technologies.

All rights reserv ed. This document contains inf ormation intended for the exclusiv e use of N-able Technologiespersonnel, partners and potential partners. The inf ormation herein is restric ted in use and is strict ly conf identialand subject t o change without notice. No part of this document may be altered, reproduced, or transmitted inany f orm or by any means, electronic or mechanical, f or any purpose, without the express written permission ofN-able Technologies.

Copy right protection includes, but is not limited to, program code, program documentation, and materialgenerated from the sof tware product displayed on the screen, such as graphics, icons, s creen displays , sc reenlayouts, and buttons.

N-able Technologies, N-compass, N-central and Monitor Manage Optimize are trademarks or registeredtrademarks of N-able Technologies International Inc., licensed for use by N-able Technologies, Inc. All othernames and trademarks are the property of their respectiv e holders.

www.n-able.com

[email protected]

1-877-655-4689

MA-NCP-2.0-WP-1.0-ENUS-RES

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