Tuesday, September 09, 2008

SMB Consulting 3.0

I can't reveal details yet, but I got an email yesterday that makes clear how much the world of SMB Consulting is changing in the next year.

We are truly entering the stage of SMB Consulting 3.0.

SMB Consulting 1.0 had a long history. SMB Consulting 1.0 consists of:
- Doing all work manually
- Doing all work in person
- Little or no reporting of details to client ("fixed exchange")
- All tools and software sold and managed independent of all else
- Trading dollars for hours: Limited capacity per person
- Specific jobs might be flat fee, but the basic model is hourly labor
- Growth comes from hiring more people, allocating work between levels of technicians
- Break/fix because that's all there is
- Tiny (microscopic) communities online and offline

SMB Consulting 2.0 has a shorter history. For most people, it has been adapted over the past 3-5 years:
- Client systems monitored 24x7
- Patching and updates done "automatically" (or at least in bulk)
- Some work done by scripts
- A significant amount of work done remotely with remote control software
- Reports to clients can be rich and useful. Range from one-page summaries to dozens of pages per month.
- Many tools now combined, including hardware and software (e.g., spam and virus filtering built into firewall)
- Flat fee pricing is becoming the norm, filled in by hourly project labor.
- Specific work outsourced to NOC (MSPSN, Zenith, etc.).
- First level of growth comes from assigning more and more work to NOC, allowing smaller MSP to take on more clients.
- Second level of growth includes hiring staff, knowing that you have the NOC behind them.
- Third level of growth comes from bidding on much larger jobs because you have automated support and capacity-on-demand.
- Monitoring, managing, and maintaining systems is the core requirement. Break/fix is much reduced.
- Communities are flourishing. SMBTN, MSPSN, HTG, MSPU, SBS user groups, Yahoo Groups, ASCII, Comptia, etc. Exploding. Each with a unique contribution to the mix.

But now I've seen the future.

Here are a few secrets whose details will emerge in the next 4-6 weeks:

- Books and products you didn't see coming. Great stuff. Prices are NOT in the $599 / $999 range. More like $150, $100, even $60.

- Alliances between organizations that give preferred pricing and benefits will continue to evolve.

- One of the current first-tier conferences will eclipse SMB Nation within six months of today.

- Deeper channel involvement with the SMB consultant community will mean faster tech support, better free training, and deeper discounts.

- Group involvement in purchasing power for next-generation technology will put participants way ahead of those who do not participate.

I know these are vague, but very specific announcements are planned soon. Add all that to the amazing, over-the-top training and best practices from MSPU and the awesome growing communities at MSPSN and SMBTN, and the future is HERE!

SMB Consulting 3.0 is still evolving. Many businesses (all sizes) have not moved to 2.0 yet.

And what will be so next-generation in the next year?

- Standardization. And Standards.
- Client requirements for managed services.
- True professionalism of organizations. Again, standardized roles, training, certifications that aren't from vendors.
- Dramatic reduction in tool prices. Perhaps even consolidation of the industry.
- A clear change of who the most important players are in the space. In conferences, in training, in tools, and in online resources.

What a great, exciting time to be in the business.

- - - - -

These changes are taking place at three levels: The clients, the MSPs (VARs), and the support communities for the VARs.

The support communities have really matured. We might last another 15 months before consolidation begins, but I don't think so. There are too many spectacular organizations, and they all want to provide everything.

The VARs or MSPs are embracing the tools. Anyone who is completely break/fix on January 1, 2009 had better start polishing the resume. You don't have to call it managed service and you don't have to offer flat-fee pricing. But you better have a ticketing system (e.g., Autotask), a delivery system (e.g., Zenith or Kaseya), and a back-end NOC arrangement (e.g., MSPSN or Zenith).

Part of the consolidation is going to come from the fact that you can now buy world-class tools on a one-by-one basis (e.g., Secure my Company or MSPSN). So the smallest VAR has no excuses not to participate.

The Biggest Change that's coming is Client Sophistication.

If you haven't already run up against it, you will start finding clients who expect remote monitoring, patch management, regular reporting, flat fee pricing, remote desktop support, monthly maintenance, and vendor management.

Think about it: If you are buying a firewall or a laptop, what do you do? You make a little checklist and compare three or four options.
- LAN speed
- Accepts SSL certificate
- VPN built in or extra cost?
- Maximum VPN connections
- Spam filtering built in?
- Virus scanning built in?
- Three year warranty?
- Remote management

and so forth.

Skip ahead.

Your prospect is looking for a new service provider to manage their network. The last one was a mid-sized VAR with 20 technicians who promised managed service but really only did remote monitoring and remote desktop support. They had a ticketing system but zero understanding of true managed services.

The tools do not make the consultant.

Now the client is looking for a new consultant. Checklist time:
-- Remote Monitoring
-- Patch Management
-- Reporting - how much and when?
-- Flat fee pricing?
-- Ticketing system with the following features . . .
-- Remote desktop support
-- Monthly maintenance included
-- Vendor management (ISP, live of business, etc.)
-- Outsourced CIO: included or extra fee?
-- Includes Spam Filtering service?
-- Includes Anti-Virus service?
-- Offers Hardware as a Service?

How many of those boxes can you check?


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