First, remain calm and carry on smartly because your clients will always need technology to run their business. The question is will they get the technology from you? The type of technology that they need is also changing. In the new channel, your sales may decrease but your margins should increase. You may also need less people working for you as you implement process automation systems.
MSPs are closer to the new channel business model, but many are also challenged with making their business work. Delivering services with the wrong infrastructure means that their cost will be too high to generate a good return on the monthly recurring revenues.
So, how do you successfully transition into a recurring revenue business model to be successful in the next generation channel?
Try following these eight steps:
1. Ensure that you know your clients well. If you do not know them well, you will eventually loose them. The more you know about the strengths and weaknesses of your clients, the easier you can recommend the technologies to help them. You also need to know their competitors so you can help them to benchmark their technology needs. Implement a CRM tool to help you to manage these relationships better.
2. Review your own strengths and weaknesses and ensure that you have an action plan to improve over time. To deliver the new technologies, your business needs to be well streamlined and managed. If your overhead is too high and your processes are too clumsy, then your profit margins will drop and you will become vulnerable to your competitors.
3. Sit down with your team and review your business vision. Explain how each employee plays a role in attaining the vision. Review their strengths and weaknesses and give them the training and tools that they need to do the job. Remember your profitability requires an efficient process and your team is a big part of that.
4. Audit your vendor partners and customers. Consider cutting those who are not adding profits to your bottom line or those who simply eat up to much of you time. You do not have to stop doing business with these vendors or clients, just move them to a self-serve model online.
5. Vendors and distributors management. You need to manage your suppliers as best as possible to generate as much margins and support as possible. Support is just as important as margins. With proper support you can generate sales leads and finance marketing campaigns.
6. Focus in specific areas in which you have big wins. If you have clients in legal that like you, then leverage this to expand throughout the legal sector. Dominate a sector and then move on to the next. Growing deep vertically will increase your revenues. It is good to have a big piece of a smaller pie than the crumbs of many pies.
7. Develop a good marketing strategy and execute properly to generate qualified sales leads for your sales staff. If you are not sure, seek professional help from someone who has the right experience. Do not use your sales staff to find qualified sales leads. This is not their job. Their job is to nurture leads, close them and then maintain them to squeeze out as much business as possible. Marketing’s job is to figure out how to find qualified leads by leveraging all of the good value that you offer.
8. Get your managers to be on the ball. If they are weak, nothing will work. They must coach and lead. Professional coaches can help you to figure this out. A solid manager is worth their weight in gold because they will inspire, motivate and help your staff reach their goals.
There are other things that you have to do, but if you can master these 8 tasks, then you are well on your way to remaining relevant in the next generation channel.