MSPs must be Business Partners not Technology Providers

“Any sufficiently advanced technology is indistinguishable from magic,” is one of the three laws of prediction formulated by science fiction writer Arthur C. Clarke. Information technology (IT) historically hid behind this fictional magic wall that created a real division within most organizations between the in-house IT staff, who were left to do the voodoo they do so well, and the business people, who were left to conduct the actual business of the organization. The IT department was essentially an internal vendor, a provider of something so seemingly magical it exempted them from being actively involved in the business.

In the early days of cloud computing, a lot of time and effort was spent trying to demystify it, to bring its magic down to earth so that business muggles might be able to understand this emerging IT model. But as muggles everywhere were growing more tech-savvy, business people realized not only was advanced technology distinguishable from magic, it wasn’t magic at all. With the spell broken, the traditional divide between the business and IT also broke down. As these lines blurred, shadow IT emerged from the shadows and the consumerization of IT meant organizations no longer had to rely exclusively on their IT department, which now realized it needed to become less of an internal vendor and more of an internal business partner in order to survive.

The consumerization of IT also fueled the market for managed service providers (MSPs) that have become accustomed to, and quite successful at, being technology providers of cloud-based services. Infrastructure as a service (IaaS) and platform as a service (PaaS) are business-agnostic, meaning MSPs are providing technology independent of, and without really caring about, how businesses use it. Even many software as a service (SaaS) offerings are business-agnostic (e.g., the generic time-keeping and invoicing SaaS I use in my business). While these services are often rightfully referred to as business-enabling, it leaves it up to the business to do their thing while MSPs just take care of the technology. But this is the very same mindset that isolated the in-house IT department and made it so easy for organizations to replace their services with MSPs in the first place.

If MSPs want to avoid repeating history, they need to reposition themselves as providers of business-partnering services. In other words, as Pedro Pereira recently blogged, MSPs need to integrate business workflows into their services and offer solutions customized for vertical industries such as healthcare and banking. MSPs must be business partners not technology providers. Partners are hard to replace. Providers are easy to replace, especially with someone cheaper and/or faster. 

This post was brought to you by IBM for MSPs and opinions are my own. To read more on this topic, visit IBM’s PivotPoint. Dedicated to providing valuable insight from industry thought leaders, PivotPoint offers expertise to help you develop, differentiate and scale your business.