Navigate 2015 is fewer than 10 days away! In preparation for the conference of the year, we've created a special Navigate series for MSPtv highlighting some of our key speakers who will share what to expect during their sessions. Continuing our MSPtv Navigate Special series, we have Chris Johnson, CEO & Founder of Untangled Solutions. In his session, Chris will provide strategies to create a custom-service package for each of your customers, give real-life examples of how to structure unique service packages for SMBs, and more! Tune in now!
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Scott: Hi. I'm Scott Glidden, and welcome to a special series of MSP TV. We'll be profiling speakers who will be presenting at Navigate 2015 this coming September 27 to 29th in Las Vegas, and with me here today is Chris Johnson, CEO of Untangled Solutions out of Los Angeles, California. How are you today Chris?
Chris: I'm good. Thank you.
Scott: Excellent. So you're going to be covering Customizing Managed Services to Create Profitable Packages. Wanna give us a little overview on the subject matter?
Chris: Sure. It's an interesting topic that I think is pulled from the fact that as managed service providers, we're constantly diluting our content offering by bundling more and more into the same price-point. The reason I got asked to speak on this topic is I think there's any opportunity to sort of unbundle, if you will, some of the pieces of our managed services and offer them separately at a higher margin.
Scott: Good. You know there's a lot of, obviously a lot of different ways to go about things, but I think you've kind of hit on some really important topics here about why is it important to create individual solutions for a prospect? Why should an MSP be investing that kind of time?
Chris: Well, I think it's two-fold. I think the first one is I have not ever met two clients that were exactly the same. And second, when I go into a client using the template, if you will, from the previous client, it often gets muddled or in the way of trying to really understand or show that I'm listening to them. When we have the conversation around what is their pain point and why am I in the room to talk to them about their needs for IT infrastructure.
Scott: Right. And you never really know if there's going to be another MSP knocking on their door as well, so you really want to differentiate yourself quite a bit.
Chris: Absolutely. It's interesting that we're having this conversation today. I actually just lost an opportunity with a rather large business and the contender was, "We're going with another managed service provider." And when I asked the question, "What was the differentiator?" and they came back and said "Well, they were a lot less money." I said, "Well, good luck, and hopefully you won't be calling me in the near future to revisit the decision to make such a big impact on your own business by the deciding factor being dollars."
Scott: Yeah. Sure. Yeah, it's a...our computer systems, our IT networks and so forth are such an integral part of the success or failure of many small to mid-sized businesses, and it's no longer a 'want to have,' but a 'need to have.'
Chris: Absolutely. You get into the...if you think about going into a business and talking to them about their needs, we've gone in talking to them about predefined solution stacks that have nothing to do with that customer. It has everything to do with what we know, in theory, at the infrastructure level that they should have in their environment. But what we don't do a very good job is educating them on why they need those things in their environment. And I think if you can get past those things and start talking about their unique needs, you actually start to create a package that's very unique to that opportunity, that can be priced accordingly.
Scott: Yeah, yeah. So when you're going in and you're thinking about what you need to put together in terms of a proposal for a potential new client, what are some of the main points that you feel are important to hit upon?
Chris: I think there's two really big ones. One of them is their business continuity, and have they ever even thought about it? Most small clients or smaller businesses are often caught up in making sure they have a backup. Their mind is wrapped around whether it's a...I won't say vendor names, but whether it's a consumer-based product or not, it's really about how do I get my data from point A to point B? What they should be concerned about is, how do I get my data back? That's really the...data accessibility is such a big deal right now, and all of the compliance and regulations surrounding data accessibility has a huge impact on whether or not you stay in business, should the unforeseen happen. So there's that.
And then the second one is, do they really know what is on the machines, and the environments that their end users are working from? It's interesting that we've seen prospects where they talk about how they help their existing IT support group do things like defrag their hard drive. And you know, you chuckle and you think it's ironic and it's humorous, and it is to us because we've been doing this for a long time, but it's like, "Hello this is not 1999 anymore." We have tools that do that for us. We don't need people to defrag a hard drive manually. In fact, if you're doing it manually, I'd raise a red flag as, "Are you going to be able to defrag it correctly?"
Scott: Yeah for sure. Yeah. Certainly going in and making a proposal to a new client and hoping to turn that into a long term success to me is a two sided coin. And one of that is as you just described, technology and making sure you understand the client's needs and future requirements as well, but it's also customer service and sometimes...and that relationship that you build with clients. How do you...what's your go-to when you walk into a client's office there, your first impression with them?
Chris: I think the first impression is always...we are here to listen and hopefully provide some education in the process, so that if I leave the room they're better for it, and so am I. I don't necessarily need to land every conversation or convert every opportunity into a deal. My lead engineer said it best at one of our recent meetings. We were meeting with a prospect, we thought it was a slam dunk sat down and my engineer just goes, "I've got to stop you right there. This is what is our differentiator from our competition." He goes, "We don't do it like they do." And I was like, "That is a really simple line, what do you mean?" And he goes, "Our value play is that we're going to be as proactive, so that you don't have to be reactive."
And I think most managed service providers, particularly ones that are drinking the Kool-Aid, if you will, of leveraging the Continuum products and will be at Navigate, is that we do things proactively so that we're not getting that phone call at two o'clock in the morning that says, "Hey I'm trying to update an Excel spreadsheet and my computer just rebooted and it's giving me the blue screen of death."
Scott: Yep. Quite true. So what kinds of strategies or points do you go into around service types of levels that you create for a potential client, may be using some of the Continuum products?
Chris: Sure, there's a couple significant plays and one thing we try not to do is to get caught up in the, "We can provide you with a basic level of support for XYZ dollars per month, and then there's the middle ground for a little bit more, and then there's the elite package," if you will. And of course, then the customer's like, "Well I want elite, but I want it for the price of the first set." How do we get to that? How do we negotiate all that? And so, I'd like to say that it really boils down to not negotiating and to not...to be willing to walk away from the deal on the table, because their gut reaction is, "Well, our budget really doesn't...you know that's $750 or $800 more month then I wanted to spend." It's like, okay, notice the words were "wanted to," or "wasn't planning on," didn't say, "don't have the money to." They're looking to get you to automatically respond with, "Well, if we make some changes here, we can get you within your budget."
That's not the goal. The goal is to provide value and service at what it should be, and to not compromise on that. I think as soon as you start subtracting dollars, and try to still include the service offering without changing what's gonna be provided, both parties lose.
Scott: Right. Yeah, I've heard it from many MSPs before that if you walk in the door and they're going to start competing with the next MSP next door strictly on price, it's a rabbit hole that you just don't wanna go down.
Chris: Absolutely. I think that...I forget who had said this and I'm sure it's been said by more than one. There are three things that are at the top of everyone you're going to meet with. It's gonna be quality, cost, and response time. And you can't have all three. You can two out of three, but you can't have all three. So if cost is the leader, if that's the one at the top of the list, I would even argue that you can't have the other two.
Scott: Yep, if that's a restriction. Any real life examples about how you structure a service package level for MSPs?
Chris: Sure. The service level is never client-facing, in our book of business. Service level is always internal. I think as soon as you go and have a conversation with a client about, "Our response time in your office is two hours," well then they're gonna hold you to that. And suddenly you've created an SLA with a client that didn't ask for one, but they're gonna hold your feet to the fire when that SLA gets broken.
Scott: Yep. Yep.
Chris: So our rule is, we make a best effort, we do everything within normal business hours. We make exceptions, we try not to ever include those in the discussion of closing the business. But really once your foot's through the door, once you've onboarded the client, in my opinion the SLA or the goals here are really about how do you farm that client, going forward? Because none of us wanna be hunters forever.
Scott: Right. Any final words for those out there about how best to approach when you're putting together a proposal for a potential new client?
Chris: I think for us, the biggest thing is be prepared, and any opportunity that you walk into to have the conversation, that you're prepared to walk out with a contract. Just because you don't know the ins and outs of their business doesn't mean that they're not ready to write a check. And those sometimes are the best opportunities in the world, because the number one reason they're asking you to be in the room is not dollars.
Scott: Right. Right. Quite true. Well, we're really looking forward to your talk at Navigate, Chris, and I really appreciate you taking the time out of your day to give us an overview of what you'll be presenting.
Chris: All right. Thanks. We'll see you guys at Navigate.
Scott: Excellent. Thanks so much, and I hope to see everybody out there at Navigate as well, in Las Vegas on September 27th to 29th, and look forward to talking to you soon. Thank you.