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Acer America
Acer America Corp. is a computer manufacturer of business and consumer PCs, notebooks, ultrabooks, projectors, servers, and storage products.

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333 West San Carlos Street
San Jose, California 95110
United States

WWW: acer.com

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October 21, 2022 | Shawn Sailer

Automation Can Help MSPs Improve Valuation and Profit Margin

Automation of repetitive and mundane tasks allows MSPs to free up employees to focus on more profitable aspects of the business, improving their firm’s overall value.

COSTS ARE INCREASING everywhere for businesses, and managed service providers (MSPs) feel the pinch too. While MSPs have sought to reduce unnecessary costs, streamline operations, and increase profit margins, they have another lever they can pull to improve valuation: acting on insights hidden deep within an organization’s data to automate processes.

Automating discovery and documentation while actively monitoring IT systems empowers MSPs to audit their customers to understand growth opportunities, proactively identify changes to stay ahead, and free up employees’ time to focus on more profitable aspects of the business, thus improving their company’s overall value.

MSP buyers are primarily interested in a company’s value and customer base. A valuation is heavily focused on recurring revenue, not professional services or project work. That’s because professional services and project work can go away overnight, but recurring revenue attracts potential investors who want a healthy cash flow.

There are two ways for MSPs to increase their profitability: increase revenue through sales or become more operationally efficient by harnessing the data at their fingertips.

This is not a binary choice; successful MSPs do both.

Automation Is the Answer

To be operationally efficient, MSPs can’t operate with humans alone. People call in sick, have personal problems, and take vacations—all regular occurrences companies accept and work around.

Automation, in contrast, doesn’t need time off or long weekends. It alleviates the need to hire additional employees for recurring tasks and empowers team members to accomplish even more.

MSPs often spend an inordinate amount of time focusing on the seemingly endless list of mundane chores, such as updating documentation. What can feel like just a few minutes every day adds up quickly across all resources. As systems grow in complexity and volume, it is increasingly difficult for team members to manually check systems, verify the security state, or confirm which upgrades are urgent.

MSPs trying to complete these tasks with humans are effectively running on a hamster wheel, because these systems are continually evolving—someone is always making a change, whether it’s on their team, at the customer level, or a third party.

With so many moving pieces, documentation can quickly become outdated. Manually updating it is almost an exercise in futility, requiring additional time, effort, and expense, effectively throwing away hours of technical resources on a problem that doesn’t drive revenue.

Automatically documenting systems with reliable accuracy couldn’t be done previously. Today, once operationalized, it happens almost instantly.

Data Is King

To be effective, MSPs need to know everything possible about the state of their customer base.

When MSP team members work to solve a problem, 95% of the effort is research, and the other 5% is knowing which system to change to achieve the desired outcome.

They can manually check every system to figure out what needs to be done, which takes enormous time, or they can turn to a tool that automatically collects the data from these disparate systems to help them make an educated and immediate decision.

Automation is the key to a data roadmap that directs MSPs to the most efficient solution quickly. In other words, that data leads to insights, and those insights lead to powerful outcomes.

There has been a persistent theme around automation reducing the number of jobs available. But automation doesn’t eliminate workers; it makes them more impactful.

MSPs that embrace automation tools will rise above their competition, improving their service to their customers while increasing profit margins.

MSPs that do not embrace automation to get the data they need to ensure they deliver for their customers while boosting profits and valuation are doing themselves a disservice. More importantly, they’re doing their customers a disservice.

SHAWN SAILER, vice president of sales at Liongard, has more than 20 years of experience in solution selling and management, focusing on improving business processes and leveraging technology.

 


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