How much real value does your managed IT service provider (MSP) add to your business? Can you measure their impact beyond cost in the books?
Now, more than ever, Chief Financial Officers (CFOs) face the ongoing challenge of enhancing operational efficiency while maximizing profitability. Your MSP’s effectiveness is a huge factor in overcoming this challenge.
But understanding the full scope of your MSP's contributions—both tangible and intangible—often feels like navigating a maze without a map.
Luckily, this article aims to help you navigate this complex landscape.
As experts in providing managed IT services, we at Intelligent Technical Solutions (ITS) are committed to redefining the role of IT in your organization. We believe in converting IT from a support mechanism into a strategic powerhouse that propels your business forward.
This is why we wrote this article: to arm everyone with a framework for accurately measuring their MSP's value. Craig Anderson, ITS Director of Client Success, will also comment on this topic.
1. Financial Performance Indicators
The first step in evaluating your MSP's contribution is to examine financial metrics such as cost savings, ROI, and overall impact on the bottom line. Key factors to consider include:
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Cost Effectiveness
How has the MSP helped in providing more value for your company? Do they improve resource allocation, automation, or vendor management?
“It's not really ‘Have you spent less?’” Anderson explained. “It's more, ‘Did they help you plan and predict those upgrades and expenses? Were they proactive? Or are you constantly being faced with surprise repairs, surprise expenditures, and surprise equipment?’”
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Return on Investment (ROI)
What is the ROI of the services provided by the MSP, considering both direct costs and indirect benefits such as increased productivity and reduced downtime?
“You should look into getting more from the dollars you spend,” Anderson said. “Make sure that those dollars are directed in a way that benefits your business. That's where ROI comes into play.”
RELATED: How to Determine the ROI of Your Managed IT Services
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Budget Alignment
How effectively does the MSP’s service delivery model align with your budgetary constraints and financial planning? Has your MSP helped you predict your expenses vs. surprise expenses?
“At the end of the day, your IT is your IT. And if you're being proactive, you have to invest in it no matter what,” Anderson said.
And that’s where a great MSP helps: with solid, predictable, and value-based billing.
2. Operational Efficiency Metrics
Beyond financial metrics, you should assess how your MSP influences operational efficiency and business agility. Consider evaluating:
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Service Availability and Uptime
How reliable are the services provided by the MSP? A reliable MSP ensures that your systems and services are consistently running, minimizing downtime that could lead to lost productivity or revenue.
This continuous operation supports your business operations and improves overall efficiency and customer satisfaction.
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Response Times and Resolution Rates
How quickly and effectively does the MSP address issues? The speed and effectiveness with which an MSP addresses and resolves issues are crucial to your satisfaction.
Fast response times minimize disruptions to business operations, while effective resolution rates ensure that problems are not just temporarily patched but properly fixed.
An MSP that excels in these areas enhances your business continuity and reduces the long-term impact of IT issues.
RELATED: What SLAs Should Your Business Look for in a Managed IT Provider
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Innovation and Scalability
Does the MSP proactively offer innovative solutions that support your company's growth and scaling efforts? Do they offer new technologies and services that align with your business needs?
Done right, they can help you stay ahead of the competition and adapt to market changes. A proactive MSP not only supports your current IT requirements but also anticipates future needs.
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Proactive vs. Reactive IT
Are they focusing on preventative maintenance? Do they conduct continuous monitoring and provide updates to ensure your IT infrastructure remains secure?
With proactive IT, an MSP can help you avoid costly downtime and disruptions, supporting continuous business operations and improving overall IT system health.
3. Strategic Value Contributions
Lastly, assess the strategic value your MSP brings to the table. This encompasses:
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Alignment with Business Goals
Does the MSP understand your long-term business objectives and tailor their services to support these goals?
Do they exceed expectations by providing solutions beyond standard packages – that are specifically chosen and configured to help your business thrive?
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Proactive Risk Management
How does the MSP contribute to your risk management efforts, especially in areas like cybersecurity and data protection?
An effective MSP will use advanced tools and practices to continuously monitor your systems, address vulnerabilities, and ensure compliance with relevant regulations.
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Partner Ecosystem
Does the MSP leverage its partner ecosystem to bring you the best technology solutions and expertise?
This access allows them to deliver solutions that suit your needs. In addition, through these partnerships, an MSP can often provide these solutions at a better value, with faster implementation times and enhanced support.
Ready to Evaluate Your MSP?
It's clear that CFOs play a pivotal role in ensuring their MSP adds tangible value. By consistently evaluating your MSP, you can more effectively build a true partnership for improving your IT.
As you reflect on the value your current MSP adds, consider scheduling a consultation with ITS. ITS brings a wealth of experience and a proven track record in aligning IT services with business objectives, ensuring our clients not only measure but also maximize the value their MSP provides.
But if you want to continue evaluating your MSP on your own terms, check out these other resources:
- [CHECKLIST] Questions to Help You Evaluate a Managed IT Provider
- Why MSP Pricing Varies (& How to Evaluate a Provider)
- ITS Pricing: How Much Do We Cost? [Updated]
