10 Growth Opportunities IT Service Providers Need to Know
by Chris Preimesberger
Growing Demand
From hiring to revenue, there will be increases in the ITSP industry throughout 2014. What’s driving demand? Sixty-five percent of respondents said new client requests, followed by the need for new skills and geographic expansion. ITSPs need to be prepared to be able to evolve quickly to remain competitive.
High-Growth Client Bases
Which size company is growing the most? At 48 percent, midsize businesses (25 to 99 employees) are growing the most, and the fastest, followed by small business (1 to 24 employees), at 32 percent, and large businesses (100-plus employees) at 20 percent. Consider targeting SMBs that are growing, and ride the wave.
Decline in Client Renewals
Even a loss of clients can present an opportunity. In a growing market, the more efficiently an ITSP operates as its revenue expands, the better positioned the provider is to drive up profits and improve ongoing performance. In fact, an improvement in customer service is the No. 1 driver of client renewals (and a great way to ensure that you keep recurring revenue already earned).
Technician Value
Without knowledge and expertise, what value do your technicians (or your business) bring to the table? Knowledge and customer satisfaction ratings rank as the top two measurements of technician value. Technicians’ billable hours or utilization come in at a close third—a metric a lot of ITSPs don’t forecast correctly or measure for success. Take advantage of the technical expertise available to you, and let your clients know that it is available to them.
Microsoft Windows XP End of Support
While the Windows EOS deadline of April 8 has passed, reassure clients that there is still time to migrate successfully to a modern solution. This is a great opportunity for ITSPs to build stronger relationships with clients by being a trusted resource that informs and educates them about their options—and how your business can help them take advantage of the opportunities available to them.
Cloud Adoption
Migrating to the cloud is increasing in popularity. Cloud technologies continue to disrupt the ITSP channel, both in the marketplace and within business models. Respondents stated that the expansion to the cloud/hosted apps is the No. 1 technology that’s changing client expectations and driving growth and efficiency.
Cloud Security
Security is the top priority for ITSPs’ clients in 2014, ranking above mobile-device management. Security is more than the antivirus and anti-spam solutions ITSPs have been delivering for years. ITSPs should seek out new security solutions to meet the challenge presented to businesses to secure their piece of the cloud and the technology infrastructure supporting business operations.
Automation
Duplicate data entry, inaccurate billing, sub-optimal scheduling, on-premises hardware and software maintenance, and disparate system maintenance are actions that when performed manually can lose ITSPs up to 20 billable hours per month. Add each of these five tasks, and ITSPs are facing a loss of 100 resource hours a month. Automation, eliminating nonessential tasks and streamlining business processes could potentially trigger a six-figure increase in revenue or a reduction in costs, leading to increased profitability.
Metrics That Matter
Are you tracking client goals and satisfaction levels against industry benchmarks? How easy is it for you to determine client and contract profitability, or gross revenue? If you can understand the key metrics that matter in your business, you can set a path for growth and success through a continual improvement approach.
Surveys
Survey respondents ranked customer satisfaction as the top measure of business health, but they report less-than-rigorous methods to measure that metric. How can ITSPs know their client satisfaction rates and benefit from client insights. Use surveys. While 52 percent never use a survey to gain insight into customers’ satisfaction, for those who do use surveys, email is the most used method. Find unhappy clients before they leave, or find your next case study by surveying your clients.