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Build a Better MSP - Blog

2 min read

Start vCIO with Quick Productized Projects

By Denes Purnhauser on Mar 2, 2017

Starting vCIO services can be a struggle not just for you and your people, but for the clients too. There are some established expectations of vCIO services, which sets a hurdle right at their kickoff of these services. There is, however, a natural way of solving this problem: use easy to sell and easy to deliver productized vCIO projects.

Of course, developing such effective and elegant solutions does take time, so we’ve set up a shortcut to start, and let you build up vCIO Project products instead. Don’t worry - this isn’t taking on new work - just solve problems you’re expected to already, but start getting paid for all you do.

Let's see seven examples of typical vCIO products:

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5 min read

Systematic service development process

By Denes Purnhauser on Feb 17, 2017

One of the hot topics in the bootcamp was a typical MSP issue - managing client agreements. The problem gets verbalized in different ways: "I have many new services I would like to sell to existing clients" or "I have to re-onboard all of our customers because the agreement is very old" or "I want to increase our prices to reflect the improvements and additional tools we introduced" or "I barely make any money and I need to renegotiate our prices". Sound familiar? We’d like to introduce a systematic approach to solve this problem for now and the future.

 

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7 min read

ROI Calculation of the Account Management role

By Denes Purnhauser on Feb 2, 2017

If you’re running a successful, growing and modern MSP practice, you either have solid Account Management / Technical Account Management practice in place, or you’re still doing it ad-hoc, and plan to develop a clear structure as soon as possible. In both cases calculating the ROI of the new role is critical, as well as setting goals and realistic expectations for the employees. Check out this ROI calculation and the huge potential of proper Account Management to growing your business.

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4 min read

Managing "unrealistic" expectations

By Denes Purnhauser on Jul 25, 2016

I just watched a hilarious 2 minute Youtube video where a comedian recounted the tale of someone righteously indignant over the atrocious inconvenience of the wi-fi breaking up during his trans-Atlantic flight. It made me ponder the trend of setting unrealistic expectations when it comes to technology. We have a short memory for problems fixed, take progress for granted and miss the chance to revel in our achievements.

Then I was thinking that perhaps this reminds you of a type of client of yours who is spoiled by all the progress and never satisfied. Who set these unrealistic expectations? How can we make sure we're not creating the problem ourselves? Check out this quick video and see what we can do to prevent it happening.

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1 min read

What is your pink cable?

By Denes Purnhauser on Mar 16, 2016

This is a motif that’s had some traffic in the last few weeks in several situations, coming up in conversations about differentiation, going the extra mile, remarkable service, engaging clients, building a brand and the use of stories in this business.

One of our managed services provider clients told us a story about a fashion design client in Los Angeles with fashion conscious California team members. The office is artistically designed of course, with bricks, standing desks and an open cafeteria with bar tables. Lots of nice, creative radiant people having lattés while working makes this the place where techs are making up reasons to go every day.

He had some work out there and got inspired by the environment to get expressive, so he bought pink cables instead of the boring black ones.

He was just having fun. He didn’t predict the result...

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6 min read

4 Disciplines of MSP Service Development

By Denes Purnhauser on Mar 4, 2016

  One of the most under-appreciated success factors of an MSP is its capacity to develop services. We’re the purveyors of Managed Services; there are hundreds in the repertoire of any given MSP. This keeps us busy - going from concept to a product that can be sold and delivered is a long road. While product based companies have a process for product development, we service companies too often overlook the value in this powerful business practice, where all our innovation, differentiation, profitability and growth can be formulated in advance.

The trend of fragmentation in services - into verticals, delivery tools, integrations - just multiplies the need for planned process.

The usual development process for managed services providers is to do a project - develop something that solves a problem for (and with) a specific client and standardize it later. This can lead to long term future revenue, but without a clear process mixing up service development and the real revenue generating activity of the company will not only kill our internal productivity, but likely our relationship with the client, if everything they see is always in beta testing.

Let’s identify some basics to ensure our process is better than the average and pull ahead of the competition.

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4 min read

Trending Topics in the MSP 2.0 Peer groups

By Denes Purnhauser on Feb 19, 2016

A few months ago we started sessions of real peer groups, to get people together to discuss real issues, problems and challenges we’re all facing and hopefully to come up with some individual plans that boost the accountability of process execution. From these I’ve compiled a list of topics that are front-of-mind among participants. I can report that the discussions dealt with the problems in a very forward looking manner, with creative solutions and not stuck in status-quo thinking. In my opinion these sessions are giving a unique insight into where the industry is going.

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2 min read

Teams vs individuals for IT management roles

By Denes Purnhauser on Feb 11, 2016

Baby boomers, Gen X, Millenials: the different generations in the workplace set some challenges for IT leaders and service providers as well. Who’s best suited for the vCIO role?

I came across an illuminating infographic in the last week that discusses the different strengths and weaknesses involved in these demographics.

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7 min read

The Fall of the Era of Free IT Advice

By Denes Purnhauser on Jan 21, 2016

 Many IT managed services providers (MSPs) and internet telephony service providers (ITPs) are suffering the challenges of charging for IT consultation. The IT industry has taught its customers that we sell big expensive boxed packages that come with free consultation, placing the value in the big boxes and none in the advice. There are no big expensive boxes anymore, but still the advice remains free. However a systemic shift is taking shape finally reversing this conundrum. It is about offering low-cost SaaS applications and solutions with high-grade consultation fees, placing more value in the advice rather than the tool.

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10 min read

7 requirements for a scalable vCIO offering

By Denes Purnhauser on Jan 11, 2016


The MSP 2.0 model is catching fire around the world. Many MSPs have already started to design, sell and deliver vCIO services. Adding $2.000 - $4000 of vCIO monthly recurring revenue (MRR) to a current 40 seat $5000 MSP MRR is now doable but requires some preparation. We’re going to take a look at the requirements (which can be easily overlooked) of the delivery to make sure we make it profitable.

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1 min read

MSP Financial Intelligence with Larry Cobrin

By Denes Purnhauser on Nov 27, 2015


Larry Cobrin, CEO/Founder of MSP CFO, has been working on a project to make financials available for IT managed services provider to make better decisions. In my first call with him I knew we needed him to talk about finances! I was fascinated by his insights about clients’ profitability trends, classifying them and taking actions for better profitability.

He shares a lot of hints and tips about different data you need to look into (which are mostly available already in your PSA) for your organization to make better decisions. If you feel you are leaving money on the table check out this interview!

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10 min read

12 mistakes most MSPs make with their Virtual CIO services

By Denes Purnhauser on Nov 19, 2015

 

The Virtual CIO phenomenon is not new, yet the promises of the role have not been realized across the industry. Some mature MSPs who believe they have a functioning Virtual CIO practice, on closer inspection, still show challenges with delivery, scalability and profitability.

While we could go in depth to identify the root of these problems, instead here we'll highlight the twelve most common mistakes MSPs make with their vCIO. At the end of this article there is a questionnaire where you can measure yourself against other MSPs.

#update - We released this blog a year ago. This is an updated version covering the latest developments. It seems that the MSP 2.0 community was able to solve most of the issues during the last year. These mistakes now can be prevented. It has been a long year, for sure... :-)

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1 min read

Increase revenue with process related Virtual CIO services

By Denes Purnhauser on Oct 8, 2015

Ryan Williams is a superstar CEO of the ProcessPlan SaaS application. He really knows the MSP arena well, as he is also VP of Business Development for the MSP Nexxtep

I was intrigued to have an interview with him because of my belief that IT companies are specialists in process. Clients need process management experts, but that’s usually seen as a management role, and not a tech discipline. Ryan has changed this with his tool: ProcessPlan is awesome software that can be used for planning and managing processes. It makes the process problems tech problems, so the IT managed services providers can leverage them to sell process related Virtual CIO services to their clients.

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1 min read

Implementation of the Virtual CIO Services with Rich Anderson

By Denes Purnhauser on Sep 17, 2015

 
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!

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6 min read

Starting vCIO projects the right way

By Denes Purnhauser on Sep 11, 2015

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?

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1 min read

Calculating the utilization and profitability of a vCIO

By Myles Olson on Aug 20, 2015

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 vCIO? Many questions like these need to be examined if we want to structure our vCIO services successfully. Let's use the vCIO calculation sheet to figure it out!

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1 min read

How to transition from the server room to the boardroom

By Myles Olson on Jul 29, 2015

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

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1 min read

Preparation for a vCIO budgeting meeting

By Denes Purnhauser on Jul 17, 2015

This week Denes talks about how to manage other vendors during the vCIO budgeting session. This small template can help you manage the discussion.

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2 min read

Defining vCIOs from around the world: Part 4 - United States

By Péter Torbágyi on Jul 17, 2015

After Canada, New Zealand, and Australia, we take a look at vCIOs in the United States.  70% of all registered Virtual CIOs operate in the USA. Because of this dominance the US vCIO trends are often difficult to separate from the international scene. When we talk about US trends, we are talking about the international trends at the same time.

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2 min read

Defining vCIOs from around the world: Part 3 - Australia

By Péter Torbágyi on Jul 10, 2015

As part of our work with companies in the process of implementing virtual CIO services we are interested in the general vCIO movement worldwide. So we’ve created a series of research discussions country by country.

Although the largest vCIO movement is resident in the U.S.A., we also observe distinct trends in other countries where the movement is under way. Having looked now at Canada and New Zealand, let's travel to Australia and see where the vCIOs reside down under.

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2 min read

Defining vCIOs from around the world: Part 2 - New Zealand

By Péter Torbágyi on Jul 2, 2015

As part of our work with companies in the process of implementing vCIO services we are interested in the general virtual CIO movement worldwide. So we’ve created a series of research discussions country by country.

Although the largest virtual CIO movement is driven by the US, we think it’s important to have a global perspective so we try to present trends of other countries where the movement is visible. After Canada, let's travel to New Zealand and see how the kiwi vCIOs live.

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1 min read

How to handle out of scope/specialty requests from clients

By Myles Olson on Jun 25, 2015

This week Denes and Myles discuss how to professionally handle client requests that don’t fall into specific projects or pre-defined services, and some that fall far outside the traditional MSP service repertoire.  What do you do with unconventional questions and requests?  Watch and find out.

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2 min read

Defining vCIOs from around the world: Part 1- Canada

By Péter Torbágyi on Jun 22, 2015

We work with a variety of companies that are implementing vCIO services, and think it’s important to have a perspective on the general vCIO movement worldwide. We have thus created a series of research country by country.

Although the largest vCIO movement is driven by the US, we are starting this series of analysis on our home soil. So let’s see how the Virtual CIO movement is doing in Canada.

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4 min read

The secret to making money for IT consultation

By Denes Purnhauser on Jun 19, 2015

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...

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2 min read

Who's The Ideal vCIO Candidate?

By Denes Purnhauser on Dec 3, 2014

Typically there is a certain type of personality that is best suited to the vCIO role.

  • They have some consultative background.
  • Their “down to earth” mentality suits working with small to medium business.
  • They tend to be systematic, process-oriented thinkers.
  • They understand how to put technology solutions into a business solutions context.

Chances are you possess many if not all of these traits. But who else on your team also fits the role? The idea here we’re looking at here is nurturing and developing ideal vCIO candidates to build a hyper-successful MSP in the modern marketplace - something one can't do alone. Let’s take a look at what that will require. 

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5 min read

Trusted Advisor or Technician, Which Pays More?

By Denes Purnhauser on Nov 28, 2014

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.

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1 min read

Building up a 45 people rock solid MSP

By Denes Purnhauser on Nov 6, 2014

Build up a 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 MSP it is a must-watch video.

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4 min read

Our first book: MSP 2.0 - The Managed Service Revolution

By Denes Purnhauser on Oct 15, 2014

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.

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3 min read

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

By Denes Purnhauser on Sep 9, 2014

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.

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1 min read

Practice-building or Business-building Discussion

By Denes Purnhauser on Sep 4, 2014

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 vCIOs
  • 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:

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15 min read

The MSP 2.0 service offering in the 7C IT Management Framework

By Denes Purnhauser on Jul 27, 2014

We have been talking about the MSP 1.0 and MSP 2.0 business models recently. Now we are moving to the delivery side. What needs to be true to be able to say we do MSP 2.0?

The theories behind the business models are distinct from those behind the actual delivery. The MSP 2.0 model could be overwhelming as we’ve observed that changing the value proposition and solving the clients' IT management challenges means we must make numerous significant changes in our business approach.

We’ve developed the 7C IT Management Framework to solve this exact problem. It comprises a full suite of processes to enhance the IT management of clients in the 20-300 seat segment.
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18 min read

Cracking the code of the future of MSPs

By Denes Purnhauser on Jul 17, 2014

There’s been a lot of talk lately about a fundamental change in the MSP industry, and the subject may seem overwhelmingly complex. The change taking place is quite evident, but what’s inside the tornado? What is the force behind this change happening?

Understanding the underlying impetus will enable businesses to make more educated decisions where to drive their companies. Let’s demystify this change and put it in a very easy to digest format, as the core of the change is actually simple.

It is not our shortest Blog but I promise worth the read. You will see the change taking place and how it could help you drive enormous growth in the next couple years. So fasten your seatbelts!

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2 min read

MSP East vs West All Star Game

By Péter Torbágyi on Jun 25, 2014

We have been producing a fair amount of research on the topic of MSPs offering vCIO services.

Because one of my colleagues is a great NBA fan, we’re now able to present the “MSP East vs. West all star” comparison.

Now we’re very sceptical guys, but since this is based on work with 591 IT managed services providers, we inclined to believe that this is a reasonable view of the real situation of the US Virtual CIO market.

But we like to be sure, and you could help us!

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4 min read

The Story of the Struggle of an MSP that led to the ReframeYourClients Project

By Denes Purnhauser on Jun 23, 2014

Some of you have been asking us about our background, who we are, and why we’re doing ReframeYourClients. 

Our Challenge

One of our companies at first was an IT managed services provider. We’ve since reintegrated it into our holding company, but think telling its history will be illuminating...

We discovered that while our clients always needed consultancy on IT in general, we lacked a viable model to do it both properly and profitably. We’ve tried to incorporate the consultancy into the MSP high-end package, and tried to do T&M. Neither approach was satisfactory.

But the pressure just gets heavier as we’ve been witnessing the evaporating services on our MSP practice, accompanied by ever increasing needs of the clients for IT management, vCIO, and 3rd-party-project management, all while IT gets more complex in terms of organization management.

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9 min read

MSP 1.0 vs. MSP 2.0 [video]

By Denes Purnhauser on Jun 20, 2014

MSP 1.0 is not widespread yet as a business model, and there is already the new 2.0 model.

What are the key differentiators between the two models? The following will refer to an average MSP 1.0 and MSP 2.0 practice.

We are assuming that the MSP 2.0 model is heavily supported by an MSP 2.0 framework, which is crucial. The differentiations may seem simplistic, but our aim is to show the possible limitations and challenges of the MSP 1.0 model, and the opportunities of the MSP 2.0.

Keep in mind that MSP 2.0 is not a substitution of the MSP 1.0 model. It is an expansion. You can move your existing 1.0 services forward, but with 2.0 as a companion the new options are going to be very promising.

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