2020 will surely go down as one of the most challenging times in modern history. With the final stretch of this unparalleled year winding down, many MSPs are, with good reason, looking optimistically to the future despite the uncertainty around when businesses will return to some form of normalcy.
What will change? Which temporary workplace adjustments will become permanent or morph into some alternate business environment? While MSPs who act as trusted advisors will have some insight into those questions, those situations may not play out until long after the COVID 19 pandemic passes.
The naysayers suggest it could be 2022 before many leaders feel comfortable removing all the current restrictions and letting everyone go back to life (and work) as usual. Despite that discouraging prediction, there are a number of reasons why MSPs should be optimistic looking forward, including a few channel trends that will positively affect your business.
#1 The value of IT services is rising
Perhaps the biggest positive from this disappointing year is the elevated status of the tech community. When state and local governments began rolling out pandemic restrictions in March, MSPs and other IT professionals were recognized as essential workers. That designation did not receive the attention it deserves.
Where would millions of organizations be right now without skilled tech professionals making sure their systems and people are able to work from virtually anywhere? MSPs provide much of the support that keeps the SMB community operating and should be fairly compensated for those efforts. The goodwill created between providers and their clients over the past several months should fuel the industry for generations. Your actions should put you in the driver’s seat and well-positioned to drive additional revenue in 2021.
#2 Upmarket opportunities growing
Scalability has never been a more significant opportunity for MSPs. Many businesses have been caught off guard by the pandemic and government-mandated WFH directives, including Fortune 1000 companies. More are looking to the channel to fill in gaps in their IT support capabilities. MSPs can gain a foothold in the mid-market and enterprise space by partnering with peers and other suppliers to deliver local support and specialized services.
Those relationship opportunities may still be in the early stages, but 2021 could see demand rise exponentially as more organizations adjust to the new business norms. By offering co-managed services and aligning with larger partners with unique (and less seldomly needed) skills, MSPs can scale their support capabilities to attract bigger clients.
#3 Push solution boundaries to increase wallet-share
Many of the “tech innovators” are thriving during the pandemic. MSPs who successfully guided their clients through cloud and mobility transformations over the past few years are enjoying the fruits of that labor, with MRR streams on the rise and fewer WFH-related headaches. Good customers need and should appreciate your IT leadership.
What new solutions and services should those businesses be assessing in 2021? Continually evaluating your clients’ current and future needs, especially with the shifting workplace and economic drivers, is a great place to start. Keep your team focused on gaining “wallet share” with innovative new services and solutions that give those businesses more capabilities and greater efficiencies.
Consider services that fall outside your firm’s standard portfolio. MSPs often submit proposals to prospects with greater needs that they can support independently, then find capable partners to address potential gaps in resources and proficiencies. That may mean pitching your financial services clients a security operations center (SOC) to meet rising compliance requirements. Partnering with a Microsoft Dynamics-certified firm to support a larger manufacturer in need of an ERP and CRM application is a great way to protect wallet share and increase your profitability. Aligning our MSP with the right people and the right solutions is a sure way to break new boundaries in the new year.
#4 A resurgence of M&A
IT services firms represent one of the best investments in the current business environment. While some industries are struggling or face uncertainty with future revenue streams, many MSPs, vendors, and other companies in the tech supply chain are financially strong. M&A activities are sure to gain speed in the new year, with venture capital firms leading the charge.
#5 Automation on the rise
Between increasing competition and revenue pressures, every business must put more focus on efficiency in 2021. Automation and integrations should be a big part of that conversation, especially in the IT industry, where providers rely increasingly on tools that gather and distribute information relating to their clients’ networks, devices, and applications. With numerous applications at your disposal, it is easier than ever to create large-scale platforms that can significantly reduce labor costs and expand capabilities for both MSPs and their clients.
Get a head start of 2021
You don’t have to wait for January 1st to take advantage of the five trends listed above. Any day is a good day to work on building and implementing your strategic plans and, as 2020 winds down, wouldn’t you rather be looking further ahead?
Despite all the challenges in the current business environment, now is an excellent time to be an MSP, with even more opportunities to improve that situation in the coming year. What are you and your team planning to do to move forward?