MSP Value Chain: Firm Infrastructure

BY IT GLUE | March 22, 2018

If you had to go back and do it all over again, would you build your MSP the exact same way? Probably not, right? For most companies, even the great ones, mistakes were made along the path to success. The most important thing is how you apply these lessons going forward. This is why thinking about what you’d do differently is a good exercise, one that makes a significant contribution to becoming a Lean MSP. Optimizing your firm infrastructure is one of the most important ways to improve your company’s value chain.

Re-invention adds value

The reason you want to think about how your company is set up is because when a lot of companies start becoming lean, they immediately jump into looking for obvious waste reduction opportunities. But after all the low-hanging fruit is out of the way, the gains become more incremental in nature, and the law of diminishing returns sets in. That’s when the biggest improvements aren’t from process tweaks or new tech, but from a more comprehensive re-design of your organization to meet a specific objective.

If you started now, what would you do differently?

Once you’ve been in the business a while, you know what works and what doesn’t. If you think about how you’d like to have built your business, that’s actually what you need to start doing now. What will your business need to look like in order to compete going forward? Once you’ve determined that, it’s time to start structuring your firm that way.

Some of the factors you might want to think about:

  • Streamlining your stack
  • Documenting all of your key processes
  • Training all employees to have the same high level of competence
  • Being more selective about your clients
  • Optimizing your bundling and pricing

Align the factors

It is worth considering that all of these factors can be aligned. If each part of your firm’s infrastructure supports your overall strategy, it will be more efficient just on that basis alone. If you want to be that high volume, low cost, ticket-crushing, password resetting machine, then everything you do should be designed with that in mind. If you want to be the master of a specific vertical, same thing – design your business with that in mind. Any aspect of your company that does not fit with this more focused version of your MSP should be on the chopping block.

Firm infrastructure also means things like the physical space in which you work, the human resources function (who you want to hire and how you’ll onboard them), and finance (making sure that whatever strategy you implement delivers the margins needed to thrive).

Think about what your numbers look like today, and what they might look like if you could go back and re-build everything from scratch. That’s your target, right there. Keeping aiming for that target, even if it looks like a dream. Why bother? Because a new company can easily come in, set themselves up in that perfect way, and place pressure on your business.

Adjustments to a firm’s infrastructure aren’t always easy, but in the long run, you’ll be leaner, more competitive, and more profitable.

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