5 Tips for MSP Success Based on the 2021 Channel Outlook
First off, a big congratulations to all the MSPs and SMBs who made it through 2020! You’re doing something right and we want to help you keep going in 2021. So we compiled some industry leaders to get their take on the 2021 channel outlook. David Bennett, CEO at Axcient, Ben Nowacky, Senior Vice President of Product at Axcient, and Eric White, Executive Vice President & General Manager at Emburse, provided the following takeaways based on trending data, what we learned in 2020, and the realities of doing business during a pandemic.
Emburse provides expense management and accounts payable automation solutions, so Eric is familiar with introducing technology to hesitant customers. He also has experience in the channel as the President of Axcient, so he’s aware of the challenges MSPs are facing.
Thankfully, the MSP industry for SMBs is extremely resilient due to the IT, business continuity and disaster recovery (BCDR), and security solutions you provide. SMBs are easily utilizing technology to enable remote workers, and adopting necessary security protocols to thwart the spike in cyber-attacks. Utilize the following tips in your 2021 marketing strategies, content distribution, culture building, and sales outreach to grow your business in spite of, or because of, the ‘new normal.’
#1: Capitalize on required change.
When COVID hit there was an immediate pull-back on implementation projects at Embruse, so they confronted those fears with the reality that change and digitization is necessary. Remote work isn’t going away anytime soon and the manual processes of the past slow business and cost more.
Eric says, “When I think about the MSP community, that’s an opportunity to go in and provide capabilities and solutions that allow people to do things from all over the place. One of the things we hear from our analysts is COVID actually accelerated the digitization of the finance department by about five years. And I think there’s probably parallels in the SMB space in terms of the services that MSPs offer.”
David agrees, adding, “COVID has forced businesses to think very differently. It also forces an interest and opportunity for an MSP to get ahead of the marketplace, and really drive change in segments that typically are slow to change – like finance and legal.” Embracing the fact that your solutions have the power to grow business during a down time, and yes, will require change management, has proven successful for Emburse. Since sales and project managers started highlighting the benefits of digitizing during a pandemic in their talk tracks – something that’s not intuitive – customers are more willing to move faster on projects. Eric credits this approach as the “key to acceleration”.
#2: Double down on security.
Ben notes that security has become increasingly more dominant in his conversations with Axcient Partners, and it makes sense. He says, “When we look at things from a security side, obviously the threats that MSPs are having to deal with are exponentially greater.” The work from anywhere environment introduces a slew of challenges for the MSP industry to figure out. From protecting remote endpoints and device management, to uncontrolled networks, and sharing public Wi-Fi access points – MSPs have to provide the multi-layer security approach necessary to keep customers safe. Especially because ransomware and phishing attacks have spiked since the pandemic hit.
Additionally, Ben highlights the need to scale remote environments established in March for longtime use. “We also saw this massive, quick, very fast exodus to the work from anywhere environment, so lots of solutions were put in place that people through would be a temporary stop-gap thing.” Now that we know remote work is here to stay, MSPs need to be thinking ahead. With vaccines rolling out, Ben asks, “How do we return people back to an environment safely? Where I can bring devices back into my work environment, disinfect them, get them sanitized, bring them back onto a corporate network, and make sure everything is secure.”
David emphasizes the need for security using cloud-based solutions because the whole structure of IT management and security is perimeter. Before, SMBs utilized on-prem firewalls and appliance-based BCDR solutions because they were cheaper and there was only one perimeter to protect – the corporate office. Now, each remote worker is a perimeter, and David and Ben agree that moving traditional workflows to the cloud is the only way to protect each perimeter.
#3: Focus on the cost equation.
Across industries, companies continue focusing on cutting costs due to the unprecedented events of 2020, and the unpredictability of 2021. Axcient established a ‘COW,’ or cut out waste program, incentivizing employees to find areas where costs can be reduced without losing productivity or functionality. Eric recently found $150k of potential savings through a similar program, so reevaluating the way you do business, and encouraging customers to do the same, can add a lot of company-wide value.
In 2021, MSPs should consider the effects of vendor sprawl and manual reseeding, their Reference Architecture, and operational maturity. In assessing your total cost of managed services (TCOMS), you can find a variety of ways – including simplifying solutions and standardizing your tech stack – to not only reduce costs, but streamline operations, and unlock BDR growth. Ben recommends that MSPs look at everything they use, “from soup to nuts,” and ask yourself, is this the best way we could be doing this? Or, is this just the way we’ve always been doing it?
Eric credits widespread cost reduction as one of the reasons Emburse has been so successful in 2020. Companies are looking for ways to change their processes in order to save resources, and IT solutions and digitization is key. Eric says it can cost companies up to $50 per invoice to process if they’re still relying on manual protocols. He uses these types of examples to highlight the benefits of moving with the digital transformation.
Eric says, “That’s certainly part of our talk track when we talk to companies now. And for MSPs, if you’re not reducing your customers’ cost, then there’s a problem. There needs to be a benefit, either in terms of the cost, or the revenue equation. And right now, with so many people focused on the cost equation, I think that’s where the opportunity is.”
#4: Embrace and enable flexibility.
The truth is, we can’t know how 2021 is going to play out, and that’s ok, because it has to be. Embrace the murky future by equipping yourself and your customers with cloud-based solutions that enable flexibility. It’s much easier to manage change in the cloud, where you can switch things on and off, or change subscriptions. David says, “The more you can do cloud-centric, the more flexible you can be with it in the marketplace, or meeting the needs of end users, or your own employees.”
Eric mentions a recent article showing the business divide between the ‘haves’ and the ‘have nots’, depends on how flexible, mobile, and digital the organization is. Emburse has worked this into their sales and onboarding talk tracks to motivate adoption of the digital transformation we’re experiencing. A good entry point when speaking to customers or leads is asking, are you flexible enough to be ready for whatever comes next? Referencing the article, Eric says, “The fact that COVID has accelerated the divide between those that are doing well and those that are not – and it’s all about technical enablement – which is so much driven by the MSP community, and so many segments of our economy, it speaks to the tremendous opportunity for MSPs.”
#5: Have faith in 2021!
Believe it or not, both David and Eric reference a number of positive statistics and economic outlooks for the future. At Emburse, Eric saw travel expenses hit zero in March, but establishing work from home environments filled the gap with a 30% boost in non-travel related expenses. He’s seen SMBs in particular invest a lot in their digital landscape, and today, the amount of invoices and spend is pretty close to where it was before March. Eric credits the economy, stimulus legislation, and PPP loans for helping some businesses recover and balance.
Another point of optimism comes from recent labor market insights. Eric acknowledges that while the labor market in general is experiencing high unemployment, and is pretty bad – some segments, including go-to-market sales and technology in general, are expanding. When you see certain sections of the labor market increasing, especially in sales, it’s typically a signal of economic expansion going forward. Eric says, “When I’m able to couple that with what we see on the invoice data, I think it speaks to strength coming out of this pretty dark period.”
David shares Eric’s optimism for the future based on the number of mergers and acquisitions in 2020. David explains, “There’s actually been 515 transactions completed this year in the MSP or MSSP (managed security service provider) marketplace – be that vendor consolidation, MSP consolidation, or a PE (private equity) coming in and investing in people. And so, PEs don’t get involved in a marketplace if they don’t think there’s a good outcome in the future.” PEs and their investors put a lot of time and effort into making sure their investments will provide a return, so that’s just one more sign that we’re headed toward growth.
It’s time to do just what these experts recommend – explore your options against the processes, solutions, stack, vendors, etc. that you’re already using. Start a 14-Day Trial of any product on the Axcient x360Platform, Schedule a Demo, or Contact Us with questions. Axcient simplifies BCDR, cloud to cloud backup, and secure sync and share with one platform for MSPs to Protect Everything ™.
Here’s to 2021!!
About the Author:
Liz Mellem // Technical Copywriter, Axcient
Liz Mellem has been a freelance copywriter for over three years in the technology, education, and alternative medicine industries. She produces content, sales collateral, and email marketing campaigns that contribute to digital marketing strategies for sales growth and brand awareness. In her free time, Liz enjoys reading, exploring Austin, and Netflix with her cat, Harlem.