Implementation of the Virtual CIO Services with Rich Anderson

Implementing vCIO services can be a challenge. New ways of thinking, new lines of services, pricing and packaging, and service delivery all abound. Rich Anderson, CEO of Imagine IT has been working on this for a couple of months now. I asked him about his experiences, challenges, solutions and results. If you are thinking on implementing Virtual CIO services, or if you have been working on that already, let’s pick his brain. He’ a smart guy and explains everything very clearly with tons of hints and tips. Enjoy!

Delivering Business Focused QBRs

ADAM WALTER AT VIRTUAL C

You would like to be a high-value business partner in your client’s eyes rather than a basic technology service provider. Your QBR process is a critical part of influencing their engagement up to a higher level. Watch this recorded webinar with our vCIO expert guide, Adam Walter, who has shared his 5 step process to make any technical QBR into a business-focused one.

6 Best Practices of Top Performing vCIOs

ADAM WALTER AT VIRTUAL C

Watch this interview with our vCIO expert guide, Adam Walter, to learn how to be more engaged with clients by finding best practices for becoming a trusted business advisor in 6 single steps.

 

Starting vCIO projects the right way

Many IT managed services providers see opportunities with their clients that aren’t related to the existing infrastructure. Clients are instead looking for help deciding which CRM they should use; how they should migrate their many Excel spreadsheets to a Process Management application or with something else that needs IT management expertise. You want to help them, of course; you are the trusted advisor, even a dedicated vCIO. The main question is: how do you start a project AND start charging for your project management duties from day one?

The short answer is that you can start planning a solution, if you have the right scope for the project. However the process of scoping the project takes time, research and meetings. Clients are reticent to pay for this because it takes place before the sales cycle. To overcome this challenge, you have to make a deliverable product out of this process.

For that you need to apply a Project Best Practice called "Visualization" to be able to get from vague ideas, concepts and needs, to a written document that consists of everything needed to start planning the project. Without this Best Practice, the process is not tangible to your client and thus not a billable item.

For example, you may be approached to give suggestions for productivity suites, where some basic collaboration tool can be considered as a small-scope project. Medium-scope projects are a review of the current accounting system and giving some suggestions, or being asked to help them fix one process of their teamwork with some project management tool.

Anything bigger like Document Management and Sharepoint-type projects are large or custom projects.

Still, in the end your product will be: enabling your clients to make decisions, and finding the right solutions for their business problems. We can can design some project planning and strategic implementation, but we have to create a separate service for that!

The result of not having proper visualization up front: showing up to the client with no value for necessary visualization phase.

What is Visualization?

Visualization means clearly picturing the desired results before embarking on the project. It answers the questions of what we want to achieve and why. For a small project, it is enough to have an informal call with every stakeholder to find out what they need at the end of the project. For a more complex project, this needs to be in a written format so priorities among the different issues can be set. The more people involved the more sense it makes sense to communicate the priorities in one statement that includes all of the stakeholders. This creates more alignment upfront; however, it takes more time to complete. For larger initiatives, serious kickoff meetings need to be facilitated to talk through the problems and discover opportunities, threats, and different opinions.

Our objective at this point is just to create a Visualization of the project. It has a defined deliverable, the process to achieve it and a price tag to sell it.

We have developed a Use Case showing how to start vCIO services with activities like visualization to bring more value to the client here:

Goals of Visualization:

1. Starting with the end in mind; defining the "why": Visualization is going to create a picture of the end we have in mind to remind us why we want the solution. What is the original problem we want to solve? What would be needed for success? What does success mean anyway? If we are putting together a cloud strategy for the client, what is the overall need or business case?

2. Defining the required outcomes: To properly evaluate the project’s progress, the desired outcomes must be drawn from the client - not always easy to do. We need to have more than a ‘feeling’ of what needs to be done, or we can easily fail. The required outcomes are statements of what the client needs.

3. Feasibility check: Dreaming big is easy, but executing the project with a positive ROI is critical. There is a chance that the solution is will not produce a minimum required return. We need more time and money to invest where we can see results. In most of these cases we figure out a compromise to get the required outcomes - such as scaling back some features.

4. Broad Alignment: Alignment on what we need to achieve and what are the factors of success is needed among the client and vendor teams. As virtual CIOs, we are not going to manage only our team’s infrastructure projects, but projects involving different vendors as well. We have to create the necessary baselines for working together.

5. Assign the potential resources: Before we plan, we have to understand what capacities the client has and what is needed from outside. This is of course a project design input but will also determine the potential budget of the project. The more resources they need from outside, the higher the budget will be. We must also understand required amount of project management to determine the proper amount of support.

6. Create the inputs for the planning phase: We have to put all of this together to make sure we can proceed to the planning phase. Set clear goals, keep the end in mind and focus on required outcomes for a quick plan. Anticipate unforeseen questions will arise in the planning phase...this just means some more meetings, more changes and more work for everybody.

Process of Visualization:

1. Key Stakeholder Interviews: Key Stakeholder interviews are necessary to learn all that is needed from key people. A stakeholder can be the CEO, the owner, the manager of the department or even an employee who will benefit from the project. Our goal is to discover their need, the outcome they are looking for and their priorities.

We sit down in a 1-1 setting with the stakeholder and conduct the interview. It should be a formal meeting, but it can be done over the phone if needed. We highly recommend using a template like the vCIO-Project-Stakeholder-Sheet in our vCIO Quickstarter Workbook. It helps you stay organized and keep track of every detail for later. It is a fairly simple process to follow.

For a small project, it usually takes 1-2 interviews, for a medium at least 3-4 to find out the needed deliverables. You can count on 30-45 minutes each.


2. 10 Point Exercises: We have been using the 10 Point Exercises in many ways: during sales, to find opportunities, for vCIO activities and so on. In most cases, we sell a 10 Point Exercise that raises the questions that come with “we need a project.” It can be sold in a Quarterly Business Review, or it can be sold during the vCIO process, and will function here to support the goals of visualization.

The exercise itself is a group session in which you facilitate the people involved in the project to make decisions. They need to prioritize the various aspects of the project and understand each other's individual perspective. It is a very powerful exercise!

The end of the exercise is a prioritized list about the needed deliverables of the project.

For a small project, you need 1-2 exercises; for medium projects it usually takes 4-6 sessions. One session takes about 25-30 minutes to do. If you put together 2-3 sessions in one, you can save time.

3. Project Initiation: If we have agreement on the project definition and a vision of the requirements for success in mind, we can proceed with planning. This means putting some integration and making some decisions. For a quick overview, you can use the vCIO Project Management Workspace.

We can put together the Start/End date, the roles, the project manager, vendors if any, and so on. That means, if the team agrees on the priorities, we can move forward and start the plan of the project.

Putting together all the things needed for a small project with little research takes 1-2 hours. For medium projects, it can consume 4-8 hours to put together your thoughts.

Check this video for further information about visualization.

  

Conclusion:

Without having the process to get together all the preliminaries of starting a project, we would be in trouble. Either we have to pay forward a lot of hours to make it happen for free, or we start project planning without knowing the priorities.

A small visualization with 1-2 interviews and 1-2 10 Point Exercises takes about 3-5 consultation hours to conduct. It is somewhere in the $500 - $1000 range. It is great for choosing SaaS applications for productivity and process management for even smaller team collaboration tools.

A medium visualization with 3-4 interviews and 3-4 10 Point Exercises takes about 4-7 consultation hours to conduct and is in the $1500 - $2000 range. It is great for choosing a CRM, or for a basic accounting review and evaluation package, project management tools and advanced collaboration tools.

Calculating the utilization and profitability of a vCIO

How many clients can a vCIO viably service, and what is the utilization rate? How much revenue does a virtual CIO need to generate? What is the W2 goal rate for a virtual CIO? Many questions like these need to be examined if we want to structure our virtual CIO services successfully. Let's use the vCIO calculation sheet to figure it out!

How to transition from the server room to the boardroom

This week's question: How do I become a virtual CIO when I'm “just a tech?”  This week Denes and Myles Olson discuss a path to transition to the virtual CIO role. You may be more comfortable in the server room, but now you're needed in the boardroom.

To learn more, visit our MSP 2.0 Business Building Platform. 

Delivering Business Focused QBRs

ADAM WALTER AT VIRTUAL C

You would like to be a high-value business partner in your client’s eyes rather than a basic technology service provider. Your QBR process is a critical part of influencing their engagement up to a higher level. Watch this recorded webinar with our vCIO expert guide, Adam Walter, who has shared his 5 step process to make any technical QBR into a business-focused one.

6 Best Practices of Top Performing vCIOs

ADAM WALTER AT VIRTUAL C

Watch this interview with our vCIO expert guide, Adam Walter, to learn how to be more engaged with clients by finding best practices for becoming a trusted business advisor in 6 single steps.

 

The secret to making money for IT consultation

We have been using a very basic management tool called the 10 Point Exercise, where the goal is to channel client issues into a defined consulting "product" rather than just having discussions pro-bono….getting people together to ask specific questions, getting everything out on the table and developing a plan. It’s easy to learn and it turns IT tech guys into business advisors in 20 minutes.  Most importantly though it let them charge for their knowledge instead of giving it away. Let's see how...

Get long term client loyalty with regular and strategic Quarterly Business Reviews and IT strategy meetings

We aren’t going to teach how to use it here. You can learn and practice the 10 Point Exercise in many ways.

Our focus now is on how it can be used to turn your free advice into something that both helps the client and generates revenue.

Create a process to solve problems

Let's imagine we run into our client who happens to have an issue with their IT, people or systems and are actively seeking advice. Of course we engage and try to help them. However, we do not have a process; so we miss the chance to understand the root problem together, from the start. We probably sit d

own with the client several times, as we’re often their Trusted Advisors for IT, and we don’t want them to go somewhere else. Ironically this can mean both that they don’t get immediate value, and we don’t get paid for that service.

Now imagine you have a process to turn vague issues and problems into tangible results. When next you discover one of these issues just say: "This is a perfect place to have a 10 Point Exercise!" This means sitting with a few people and doing a quick and easy exercise.

There are telltale signs to identify the proper 10 Point Exercise for solving the problem based on their scope and goals. We need to keep end goal in mind: what we want to achieve.

Create alignment

Usually when these issues/opportunities for improvement arise there are differing perspectives.  While there may be agreement on the symptoms, there is no alignment about what causes the problem, so no clear diagnosis. This is vital to get at the beginning. 10 Point Exercise questions like these can help: “What are the most common reasons our employees spend so much time searching?”, “What are the underlying causes of the low productivity of office workers?”, or “What are the most important issues behind our apparent problems with working together as a team?”

Solve a problem

Our goal now is to find how we can solve the given issues. We have alignment on the problem, we’ve defined it, but we do not have a strategy to solve it yet. There are methods that work on a general level. Questions like this can help: “What are the next steps we can take to solve the internal communication problem?”, “How can we ensure we solve the team productivity problem by the end of this month?”, or “What specific actions can we take to reduce time-wasting document searches?”

Opportunity discovery

We need to clearly identify a business opportunity out of this issue, and what we need to do to capture it. Questions like these can help: “How can we improve our internal processes?”, “What is the best way to leverage our current IT tools for better collaboration?”, or “What actions should we take to make sure we can develop the service on time?”

Project visualization

The goal in this is to be aligned with the team on what we need to achieve at the end of the given IT project. Regardless the type of IT project and before anybody jumps in and starts planning, we know what success means to every stakeholder. Questions may include: “If we think about the Document Management project, what are the deliverables we expect from this?”, “What exact results are you looking for at the end of the productivity improvement project?”, or “How would you define the success of the collaboration project?”

Decision making

Now we need to make decisions and have a commitment to particular solutions, the scope of projects and needed deliverables. Questions may include: “Which collaborative solution are we choosing for implementation?”, “What are the expected deliverables and priorities for the productivity project?”, or “Which application should we use for internal chat?”

The more complex the problems the more sessions involved. We can start to clarify the issue with an Alignment session, then have a Problem Solving session and then jump into a Project Visualization. The sequence can be 2-4 sessions in a row, or on an improvised schedule as it progresses. There can be a natural sequence here. The outcome of one session can be the input for another. As we move forward we have to set expectations about how far we need to go in certain exercises.

If the team is bigger, we need more of the same exercise and to aggregated results. Do the same exercise in smaller teams and compare outcomes. Afterward, summarize the results and present that to the board.

Nice, but how do we make money?

Most of the time we are going to charge for these sessions. On one hand, we can do it ad-hoc, but we think it’s best to have prepaid packages of 5 x 10 Point Exercises, or part of the vCIO engagement.

If we see that one session takes 60 minutes of our time not including travel, prep and follow-ups, a session can easily cost us $250-$400.

We should demonstrate the exercise in real life first, so as to prevent the client from seeing it as a cost. We want them to see it instead as a great investment to solve problems with an outside party. Being unaligned, spinning the wheels and having arguments last for weeks, are very inefficient ways to solve IT problems. The $150 to $400 we are asking for the exercise has a significant return.

An IT related project can easily cost the client tens of thousands, plus applicable internal utilization of resources. Having a 3-4 session sequence of workshops can leverage that investment in a big way. Having more precise projects, better alignment and more teamwork is worth the investment and can get rid of unmanaged, ad-hoc projects.

Conclusion:

Learn and use the 10 Point Exercise, to create an entry type Virtual CIO service. The service leads you naturally to formulate and close more projects. Your time will be monetized, and your clients will come to expect to pay for reliable and prompt solutions. They’ll get a process to solve problems while you get funding for spending time with them as a vCIO.

Trusted Advisor or Technician, Which Pays More?

Most IT managed services providers we work with suffer a fundamental problem: the definition of who they are. The lack of a clearly defined definition of the business can be the biggest obstacle they face to success in the MSP 2.0 environment. The statement "I am a tech" needs to change to "I am a IT consultant." Unfortunately people often underrate themselves because they lack an MBA or they’re uncomfortable with so called “sales.” This limits them and their teams in engaging with more clients and prospects in a meaningful business way.

However, being a business consultant is just a role, a mode of operation, a mindset and the subject can be anything technical. Consulting is a behavior, a set of skills and tools that anybody can learn and implement. We are creating a series about being a consultant so you can harness the power and reframe how your clients see you.

In this first blog episode I will show you the circumstances in which it is better to act like a "consultant" rather than an "technician"

What is the consultative (trusted advisor) vs. tech (technician) mindset

First, many MSPs are under the false impression that they are having business conversations with their clients.

Be aware of this! For your clients, discussing the ROI of a VOIP is still just tech talk. Even having a chat about the financial aspects (OPEX, CAPEX) of the cloud is still tech talk. Discussing how a CRM could boost their top line is still tech talk.

The reason these are all tech talks is that in many cases the problem is created by the solution, not the other way around. This means we need to switch the conversation to talking about a potential business opportunity which the given tech-related solution could exploit. In most cases, the client did not say: "I have too much telecommunication expense", "I have too much CAPEX and want to transfer to OPEX" or "I have a sales problem” but with your expert consultation, they will be able to relate those to a technology solution you can offer. The client might be relating to these ideas in mind, but not in heart. Purchasing decisions are made using emotions backed up by logic, not the other way around.

Unfortunately the logical mind of a technician wants to speak of solutions in logical terms. That is the "I know what is best for you" mindset. And that is the telling mindset. This serves your business more than your clients, and ultimately makes your offering an expense, rather than an investment.

What if we address the business issues first and let them come to the conclusion that they have a problem? Spending time on questions and going deep into the subject not only means we understand them, but that they feel understood. Every solution we bring will be the result of a dedication to solve the problem stated. In this case, the tech projects become business projects.

This is the vCIO consultative mindset we need, and has nothing to do with having an MBA or wearing Armani suits. It is about sequence, tool set and mindset.
Let's have a look where we could use this mindset in our MSP practice:

All meetings with prospects

Every time we have a meeting with a prospect, we should wear the consultant hat. If we do, we immediately stand out in a big way. The main differentiation is that prospects usually expect to have a tech talk with a geek instead of a business conversation with an informed and experienced business consultant.

If we do not overshoot the role but just ask the proper questions and be genuinely curious about their business, we might hear something like: "Hey, I have been talking to other vendors and nobody was asking these questions..." This is the distinction we need to make..

Be open and try not to sell; you will make the sale eventually. If we trust ourselves and are courageous enough to go off the solution and focus on the issues and the problems that could form, then we are smart enough to convert those problems into tech solutions.

Firing up solutions without the business context is only noise for the client, and a false assumption for us that we have created interest.

Quarterly, yearly client meetings

I have reviewed many mature MSP's Quarterly Business Reviews. My conclusion is: reviewing MSP services like technology roadmaps during meetings is not the right way to engage clients. A consultative role lets us ask questions about their sales performance, obstacles of growth and the processes with which they are are struggling. We have to find out why the CEO is not able to sleep at night, and then help with that. In this case the meeting would be the review of their business instead of a review of ours.

Let's be proactive and challenge our clients. The best way is to start where we have experience. Every managed services provider is a process machine. Our MSP business model is all about processes, streamlining and automation. That is why every managed services provider leader has great experience with processes, human aspects, software automation, and so on. Let's start analyzing the client processes. You are going to find holes and great solutions that you can implement. These will come from your core business competencies.

Before and during projects

Technology Projects are a great way to leverage our consultative mindset. Before the project we should understand why the results of the project are required. What business benefits or deliverables will the project provide? Create a simple "Vision Statement" collecting the expectations of all stakeholders; this is a small investment of time but can be put to use during and after the project.

Use the "10 points exercise" from our MSP 2.0 Quickstarter Kit to have a better, common understanding about the goals, benefits, and expectations.

And believe me, not so many IT companies have asked the accountant or the operations manager what their expectations of the project are beforehand. So focusing on their problems and them as individuals will pay off in the long run and distinguish you now.

Any request, call we have from the client's C level

Of course, if a C-level executive calls you with a problem, there is something behind it. Most of us tech people immediately jump to conclusions, and search for solutions and so on. But our consultative mindset has to make the hard stop and ask "why?" Why do we even have a problem? Why do we need a solution at all? What are the goals, the circumstances, the context? In most cases, this is what the client really needs - to think through the problem with someone with an outside perspective who can help them to see different points of view. After a session like that you will get more phone calls about solving business problems than about fixing routers… (don’t worry, you’ll still get those calls too).

These are great ways to engage clients and open up discussions about problems that need to be solved. From this point forward nothing is going to be a tech-based project, initiative or conversation.
 

Conclusion

If you can just change this one thing about your communication it will pay off heavily. It differentiates you; it teaches your people how to communicate and it shows your client who you really are. This will help you to define your purposes and to communicate them accordingly. It will help you to stay always curious and focus on what matters to the client, instead of the perspective of the tech.

Building up a 45 people rock solid MSP

Chris Day is a Maverick in the MSP world. He is running one of the most advanced and mature IT managed services providers with his partner Sharleen Oborowsky. I had a chance to have a chat with him and to dig deep on how they achieved that success in a short time.

Chris seemed to crack the code on growth: people and execution. He is an avid book reader, community builder, leader, and an authentic down to earth guy.

You can expect: great hints, tips, honesty, bold statements and no nonsense. If you are just a little serious about your managed services provider it is a must-watch video.

Develop and operate a scalable and structured account management and vcio operation in 30 days

My key takeaways:

• How to build a rock solid company culture
• How to price for double profit
• How to "interview" your clients before you "hire" them
• How to attract the best people in spite of labour shortage
• The principles of the execution and absolute accountability
• Processes and operational maturity for scalable growth

Visit Chris's Website 

Visit Chris's cool Initiative

6 Vital Elements of a Successful Business Building Process
REX FRANK AT SEA-LEVEL OPERATIONS
Watch this interview with our MSP operation excellence expert guide, Rex Frank, to learn how to make a profitable operation by familiarizing your MSP with the Annual Strategic Operations Plan’s best practices to leverage your RMM and PSA tools that will drive down costs, manage your engineers and guide behavior

Our first book: MSP 2.0 - The Managed Service Revolution

I have to admit we haven't done a lot of blogging lately and there hasn't been a lot of new content, sorry. We do have an excuse: we have completed a book about the MSP 2.0 business model.

We got your awesome feedback on our content- thanks - including the observations that our ideas were all in little pieces, lacking real connection. We needed a more comprehensive and linear format to digest this new concept, and thought that the best way to do so was to write a book. Have a look at what we have to offer in this format, and how you can become a contributing part of the story.

The concept of this book is first to analyse the current situation and then to create the practical but holistic approach to make MSP 2.0 a reality. We wanted to deliver a business-minded explanation about the industry we are in. We have an MSP (Hauser Canada) that we plan to make successful over the next 5-10 years. Everyone sees the problems and the turmoil in the industry, but not the complete solution. We didn’t want to talk tactics, or how to sell the cloud, how to price, or package better. We wanted to show a very viable strategy toward the next evolution of the MSP model and what is needed to move quickly on that path.

We observed that while there is proven prosperity in the MSP program, on the ‘break and fix’ model, but we didn’t have a complete business strategy. It has been a long process to change the model, and most IT managed services providers still have a majority of these contracts. Our goal is to clear the slate and see what’s next:

Introduction:

The MSP 2.0 business model is a great blend of the MSP fixed-fee model combined with the much broader scope of IT Consultancy. This book illustrates that new model such that you can see how an MSP can build a scalable business around it.

Chapter 1: Business Focus or Technology focus:

Many IT companies says they are "Business Focused" but what does that really mean? What are the prerequisites to be able to make that claim? What is behind the value proposition?

Chapter 2: Why the MSP 1.0 model is broken?

Unfortunately, the initial Value Proposition of the IT managed services providers is broken. Nobody really cares about the infrastructure any more. It is a commodity, like electricity, and thus the subject is not part of the C level conversation. 

Chapter 3: Opportunity of the MSP 2.0 model

Meanwhile a substantial untapped potential is arising from the client side: the quest to be more competitive with the help of IT...to grow faster, service clients better, and communicate more efficiently. How do you address this huge opportunity?

Chapter 4: Why is it so difficult?

Do you remember how hard it was to switch from the ‘break and fix’ model to the MSP? There are two major obstacles along the way to implementing the MSP 2.0. This is going to be work too, but there are shortcuts.

Chapter 5: Requirements of the next generation program

If we want to tackle this in a systematic way, what do we need to address - the hurdles along the way we need to prepare for eliminate? What should be the scope for such a program, and what types of components should it have?

Chapter 6: The first Complete MSP 2.0 program

The complete program has many layers, like the framework, education, software, community, business building, and processes for each and every stakeholder. The client, who gets the value, the virtual CIO who delivers that value, and the leader of the MSP who is building the business.

Chapter 7: The Client Perspective

What does the client need to achieve competitive edge? Reduce the complexity of the IT, create transparency and a systematic approach to progress, ensure accountability, and effective collaboration.

Chapter 8: Virtual CIO Perspective

What the Virtual CIO needs to deliver is value in a scalable and efficient way: quick client discovery, implementation of core vCIO services and an IT management framework, effective management of IT Projects including collaboration with the clients.

Chapter 9: The Leader of the MSP perspective

What does the leader need to build a business? A Transition Blueprint Program, Self Assessment, Business Model Analysis, Creating the MSP 2.0 Value Proposition, Inbound Marketing Engine, Lead Generation engine, Predictable Sales, and Implementing the Virtual CIO services.

Chapter 10: The Roadmap for success

What is the typical roadmap for IT managed services providers of different maturities, size, and service offerings? What are the foundations and services needed to implement immediately and grow quickly?

STRUCTURE, MANAGE AND AUTOMATE YOUR ACCOUNT MANAGEMENT AND VCIO PROCESESS

How does the current definition of "IT" hurt your MSP business?

There was a State of IT Budget Report - a microscopic view of North America IT spending in 2014 from Spiceworks (RMM tool) during the weekend. It was all about analysing IT expenditures based on a 450 sample size "IT Pro" survey.It was a good report, well-thought out and executed, but there was something bothersome to me that wasn’t the fault of Spiceworks: the general industry definition of scope of IT, and because this is the industry definition, it’s usually our clients’ as well.

Differentiate yourself from your competition and

become sales ready in 30 days

I would like to highlight the flaw in an MSP defining their arena of activity based on the same definition. There is a debilitating pattern of industry players limiting the scope of the possibilities of their clients (MSPs) by limiting the scopes of the definitions of what they do.

OK. See how Spiceworks sees the "world of IT":

Hardware:

• Networking
• Server
• DesktopLaptop

• OS
• Productivity
• Virtualization
• Security
• Database

• Online backup/recovery
• Email hosting
• Web hosting
• Application hosting
• Productivity solutions
• Content filtering

• Connectivity/bandwith
• Storage/backup/archiving
• Hosting
• IT service providers
• Consulting

You can download the report from here. Again, it’s a good one.

I think this is a very good classification of the different items a general client is buying now. However, it doesn’t at all address some great opportunity aspects. This is just the traditional MSP 1.0 classification.

1. I don’t see any "new" budget sections that somebody could create based on services addressing client's problems, and suggests that they are not shopping around. The biggest missing point is IT management services. I see a category for IT consultancy, but IT management services are not consultancy. Vendor management, IT reporting, IT budget reconciliation, managing SaaS subscriptions, NIST cyber security compliance in general and so forth are not consulting services, but I don’t see the place for those.

Because these are quite new services, clients aren’t yet aware of these solutions - though they do know the problems right now. Service providers should now create budgets for these types of these types of MSP 2.0 services. This is also putting into practice what we learned from the book "Challenger Sale."

2. I also can’t see an "IT Budget" for ERP, CRM, B2B, B2C, custom software developments, online marketing, etc. These are not just "consultancy" or "software" categories. A lot of progressive IT managed services providers are making money on third-party evaluations, project managements, etc.

It is clear that the report reflects only the "IT Infrastructure" type software and has nothing to do with other "enterprise" or internal process management, reporting, and client services like software. This report would have been better titled "2014 State of IT Infrastructure Report." In my opinion, it is critical, not just semantic, that the definition of IT not be limited to infrastructure, software, and hardware.

We limit ourselves in the perception of our clients as well. When we say "IT" or "technology," their definition will be the infrastructure, and if we support this we’ll get more isolated into this slot. 

What does it mean to you?

If you are talking to your clients, they are likely to think of "IT" the way Spiceworks' termed it: infrastructure. But of course you are thinking on a broader perspective: Everything that is made of '0' or '1' is IT. If you do not address that, the new IT-based opportunities such as MSP 2.0, vCIO, reselling cloud-based business applications are not going to be a part of your portfolio.

You have two options:

1. Reframe your clients. Check this short video about reframing what IT can do for a client. This is a 10-minute presentation that shows how easily it can be done. We use this type of discussion with clients to make sure we define what IT really means, and we "redefine" IT using stories.

2. Use different terminology: In this case, you try to introduce new terminology, words, and phrases that help you create the difference in understanding. This is more difficult as you’ll regularly be trying to speak in jargon they won’t understand, like "holistic IT" or "business-focused IT".

Conclusion:

The IT industry has created a world that could limit you, where IT gets defined as IT Infrastructure. This is a limiting factor to you because you are in the IT industry. You need to differentiate yourself either by reframing your client's understanding of your trade or teaching them new terminology.

Practice-building or Business-building Discussion

James Vickery, a very progressive MSP CEO, had a couple of thought provoking questions. We’ve created a short talk to cover the issues he was curious about.

The main issues we are talking about:

• Scalability of the consulting type businesses
• The capacity of an average MSP 2.0 vCIO
• Training and retaining high profile virtual CIOs
• Managing, motivating and keeping virtual CIOs
• Building the practice for ourselves or building a business
• Transitioning to the MSP 2.0 business model
• Importance of checking the current and future business model
• Importance of very consciously developing services

Check the audio file for the 20 minute talk here:

Open the audio in a new window: MSP_QandA_with_James_Vickery

More about James Vickery and his managed services provider "I know IT" here:

http://www.iknowit.com.au

If you too have questions like that, let me know and set up a short session like this!

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