In this time of crisis, the response of managed service providers has been strong as they have stepped up to support customers
Covid-19 and the lockdown presented government, societies, organisations, businesses and people with a number of challenges that had to be confronted and mitigated in a very sort space of time. The same was true for IT.
One of the consequences of the lockdown has been to demonstrate the value and credibility of the managed services model and the role that managed service providers (MSPs) play for their customers.
As Jim Lippie, senior vice-president and general manager for partner development at Kaseya, says: “At the outset of the crisis, it was all about being able to quickly and efficiently move customers to remote working. The workloads of our MSPs were up around 50% in March due to the rush to transition to remote working.
“Expert MSPs were the ‘go to’ option for many businesses as they scrambled to get staff up and running in the home environment. In many respects, MSPs and IT professionals became the economy’s first responders.”
According to Richard Blanford, chief executive at Fordway, MSPs can provide three main benefits to customers in the current climate – support and resources, flexibility and expertise. On the subject of flexibility, he makes the point that, like other MSPs, Fordway’s contracts are “user or consumption-based, so where customers have had to furlough staff, they no longer need to pay for them while they are not working”.
The company’s services also allow for flexible working.
Pete Watson, CEO of Atlas Cloud, says the service desks at MSPs “are well-equipped to deliver the same level of service remotely from any location”, adding: “The fact that there is zero travelling time involved when working from home brings joy to your average service desk analyst.”
Francis O’Haire, group technology director at DataSolutions, says a lot of organisations may not have the skills in-house “to implement or manage the required IT systems or processes to maintain their businesses during this crisis”, but that MSPs “have the economies of scale to maintain skills in areas such as business continuity, cloud computing and secure remote access, which are so critical right now”.
MSPs ‘an ideal partner’
George Anderson, director of product marketing at Webroot, notes that MSPs are “an ideal partner for businesses forced to work remotely”. He adds: “They have already integrated security solutions within their remote monitoring and management [RMM] and professional service automation [PSA] platforms. This means they can already manage and grant users the normal access they need without them having to be behind the office walls.
“In addition, the built-in flexibility of MSP services enables them to accommodate client needs to operate efficiently and effectively, even under current circumstances.”
Anderson says established MSPs have the experience, remote management, existing business IT services and pricing models “to make accommodating the current circumstances a far less daunting IT task for small to medium-sized businesses faced with working from home challenges”.
But while Covid-19 has served to reinforce the value of MSPs to their customers, it has also presented them with some challenges. Dave Adamson, chief technology officer at Eacs, talks of having to adjust to a “massive uplift in calls”.
With so many businesses across the country working remotely, he says, “there has been far more need from customers for user support, as they have different capabilities to connect in from their home”.
Adamson says Eacs has “doubled the volume of calls and service tickets from our customers almost overnight, as our customers all wanted remote technologies, such as VPNs, Microsoft Teams, Citrix and anti-virus, and every ticket was urgent as the UK prepared for the inevitable lockdown”.
Colin Knox, head of community engagement at SolarWinds MSP, says a big issue for MSPs is that the effect on their customers is not universal. “While some verticals are relying on MSPs more than ever to solve challenges around home working and security, others are essentially shut down and don’t require any service at all,” he says.
“Only lucky MSPs will find that this balances out – most will find they are under pressure to provide increased support, with some offering payment holidays. Some specialist MSPs may find almost all of their customers want to suspend their service, leaving them in a tricky situation. Do they risk a long-term relationship for the sake of their revenue today?”
Mike LaPeters, vice-president of worldwide MSP and channel operations at Malwarebytes, says another big challenge for MSPs has been “the inability to go on-site”. This has made it difficult to bring new customers on board, which usually requires some level of face-to-face interaction, he says.
Also, critical issues on corporate or home user assets require “creative workarounds to resolve what typically would take an hour or so on-site” and can extend to hours or even days, says LaPeters.
Mark Lee, business development director at GCI, agrees, adding: “The most immediate challenge for us so far has been that, in almost all cases, our engineers are unable to go onto customer sites. This has made some project work more tricky to complete, but we have been able to handle most cases working in tandem with our customers by shipping equipment to them preconfigured and then taking them through initial installation on a call and doing the rest remotely.”
Gerry Tombs, CEO of Clearvision, identifies a number of issues. “For example, some customers have furloughed staff who are our primary contacts within the organisation, which can bring some communication challenges, especially with those customers that follow a hybrid model where an externally managed system links to an in-house system,” he says.
Security is another area of concern, says Tombs. “Various systems have approved and non-approved network addressing. When everyone suddenly moves from a single approved network address to hundreds or thousands of home-based network addresses, this could create challenges to ensure data integrity is maintained.”
Equipment is another issue because not all staff who are suddenly forced to work from home have had the correct equipment, says Tombs. “This can create an increase in support tickets because some users may be unable to tell if the problem they are experiencing is related to the managed service, or to their equipment being at fault,” he says.
Kaseya’s Lippie chooses to concentrate on another very significant consideration – money. “One of the biggest challenges MSPs face is a shortage of working capital,” he says. Workloads are up because they are setting up and supporting customers’ remote workers, he says, but “revenues are under growing pressure as customers delay or reduce their payments”.
Many consumer-facing small businesses – from hairdressers to dental practices to cafes – have been hard hit by the crisis, says Lippie. “They are slowing payments to MSPs and that is impacting on MSP cashflow and working capital. This combination of rising workloads and falling fees is putting significant pressure on MSPs, especially in the short term.”
So are MSPs coming under pressure to provide discounts, payment holidays or deferrals? The answer seems to be: it depends who you ask. Paul Colwell, technical director at OGL Computer, says there has been some pressure, “depending on the industry the customer is working in”. He adds: “Hospitality, recruitment and some of our stockist and distribution companies have been hardest hit.”
Malwarebytes’s LaPeters says: “About 25% of our partners have reported their clients requesting some sort of financial assistance, be that extended payment terms or partial discounting. So far, our community seems to be able to hold the line. We feel it has to do with the mission-critical nature of security and the assistance we provide our partners in demonstrating value to their clients.”
Scott Dodds, CEO at Ultima, says: “It is understandable that some customers are asking for payment deferrals as their industries are in total lockdown and they have no cash, or they have furloughed staff, so they no longer need certain services. We’ve been discussing payment options and terms as a result, and we aren’t going to charge for services that people can’t use.”
Webroot’s Anderson notes that the way in which MSPs are paid, either on an invoice per user per month basis or an over-arching service contract paid monthly, means they “will face pressure to accommodate additional work at next to no increase if part of a monthly agreement”. Those that just provide maintenance during the lockdown “will be facing pressure to supply discounts and deferrals” he adds. “Both of these need to be considered based on the relationship with the client and the actual that costs the MSP is incurring.”
GCI’s Lee reveals that his company has “seen a few requests for payment deferrals, particularly from clients in the most badly affected sectors, such as leisure and travel”. He adds: “We are working with each client on a case-by-case basis and being as supportive as we can.”
But Eacs’ Adamson says his organisation has “not been under any pressure to provide discounts on our services and solutions”, adding: “We are lucky to be in the position where we are a part of an honest, responsible and generous partner ecosystem, which means we are able to offer a number of free-of-charge and discounted subscriptions on software applications.”
Many horror stories
Fordway’s Blanford is another who has not come under pressure from customers, mainly because “the majority of our clients are UK public sector and larger enterprises outside the worst-impacted industry sectors”. But he adds: “We have heard many horror stories from other resellers and service providers.”
Shaun Lynn, CEO at Agilitas, makes the point that the IT industry is no different from other industries at the moment, whether it’s travel, car or finance. “What your customers will remember on the other side of this situation we find ourselves in is how far their MSP partners have gone to support not only their technology needs, but also their commercial needs – how have they tried to help when customers are faced with cashflow challenges?” he says.
“MSPs should not be waiting for a customer to ask for a discount – they need to be proactive in offering these cost-associated services.”
But Lynn stresses: “There should not be a race to the bottom, as everyone involved with the IT channel understands that won’t help the supply chain and service quality in the long run. Payment deferrals and payment holidays are something that will begin to become increasingly popular.”
So what should MSPs be doing to maintain and strengthen their relationship with clients during the lockdown? The biggest priority for most MSPs is communication. Webroot’s Anderson believes that “communication with clients during this crisis has never been so important”.
Most small and medium-sized businesses are suffering, he says, or see potential barriers and challenges to their existence, depending on how long it will take to get back to some sort of normal. “They want great advice and guidance as to how their MSP partner can help them function both cost-effectively and business efficiently.”
OGL’s Colwell describes communication as critical. “Our account managers are talking to customers regularly to understand their challenges and to see where we can help,” he says.
Jason Howells, director international at Barracuda MSP, agrees, saying: “In order to build trust, communication is key and MSPs must be as responsive as possible, utilising multiple platforms, such as phone, email, Slack, Skype and WhatsApp, to keep the lines of communication open at all times.”
Eacs’ Adamson says his company is “trying to maintain communication as much as we can” as it seeks to keep employees happy and working effectively. “Working from home and being locked down are hugely challenging for all of us,” he says. “When you are not able to have direct contact with your colleagues who are usually just a desk away, it can have an impact on you.”
Mark Sawicki, senior vice-president at Guidant Global, agrees that “displaying sympathy and empathy will go a long way professionally and personally when it comes to building long-term relationships”.
SolarWinds MSP’s Knox says all businesses are “going through the same thing right now”, and owners are worried about the short- and long-term future and concerned for the wellbeing of their employees.
“MSPs shouldn’t be afraid to simply pick up the phone and have a conversation with their customers, especially with those that they may have lost touch with a little over time,” he says. “This is good business practice and will strengthen relationships, but I think these owner-to-owner conversations have a much greater value to MSPs and their customers at this time.”
Knox adds: “It can be a lonely and stressful time at the top as business owners face an uncertain future and may be making difficult decisions. Being able to have open and frank conversations with someone in the same situation has never been more important.”
So, what about the future? Everyone is agreed that things are likely to be much changed. In the words of Logicalis CEO Bob Bailkoski: “If this period has shown us anything, it’s that remote working works. Organisations have adapted quickly to remote working and continued business as usual as much as possible.
“Once the lockdown starts to ease, I anticipate flexible working arrangements will become more commonplace as organisations look to differentiate themselves as a tool to recruit people.”
Bailkoski adds: “MSPs must be prepared to accommodate future fluctuations in customers working from home. This will lead to an increased demand for cloud skills to manage these fluctuations in flexible working arrangements and help customers thrive on this new normal.”
David Tulip, managing director at Network Group, agrees that the crisis has thrust remote working into the mainstream. “Businesses that saw remote working as impossible or only of limited use before, have had to engage with it, dragging them into the 21st century,” he says, “and they’ve seen that the technology does work. Remote working is now no longer a future possibility, but something that is familiar and they are increasingly comfortable with.”
The new normal is a recurring phrase in many conversations. “When we go back to this new kind of normal,” says Atlas Cloud’s Watson, “I don’t think today’s experiences will leave us. I think we will work from home a lot more. Many of us will invest in better Wi-Fi and broadband, maybe buy a desk for the space where we like to sit instead of piling books on our coffee table to stand our laptops on.
“We will do this with our partners and even friends, sit in our homes and maybe there will be a growth in local coffee workspaces in our community. We will question if we need to make the four-hour drive to our customers or a team meeting, when we all know we can get by with some of the excellent tools out there, like Microsoft Teams, and not pollute our environment unnecessarily.”