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Q&A With André Schindler, General Manager, EMEA, NinjaOne

What are some of the key trends in the MSP market, from automation to consolidation, and what are the key qualities an MSP should demonstrate to potential customers? Read on to find out what André Schindler, General Manager, EMEA at NinjaOne, has to say on the subject. Next month we will publish more comments on the topic from Kaseya, Barracuda MSP, Nanosystems, GoTo and Connectwise.

Technology Reseller (TR): What do you see as the key trends impacting the IT management services sector?
André Schindler (AS): Despite fears about the growing recession tech spending is continuing to grow, and companies are setting aside a portion of their budget for MSPs – mature MSPs can be seen as a risk reduction tool during times of economic uncertainty.

While some parts of an MSP contract are inelastic, a portion of the cost (project fees, licences etc.) is related to utilisation, allowing businesses to scale up and down as needed in response to changes in profitability or macroeconomic factors.

MSPs are becoming an increasingly important part of businesses’ IT infrastructures. Most small and medium- sized businesses aren’t in a position to make investments that match the in-house support services that larger companies can maintain.

Internal skills gaps and talent shortages driven by team member burnout, lack of available new hires and the high cost of training and re-training are also driving market need for MSPs.

It is almost always less expensive to leverage MSP services than to hire for highly specialised IT skillsets in the SMB and lower mid-market space. Security talent in particular is often priced beyond the reach of SMBs and small mid-market companies.

TR: To what extent is automation a key differentiator for managed service providers?
AS: Automation is a critical part of IT optimisation and plays a major role in digital transformation, in a world where rapid scaling and deployment are essential. It also makes it possible to drive down operational costs by shifting human interaction away from mundane, repetitive tasks and towards opportunities for strategic growth.

For MSPs, automation provides more time for specialisation, the proactive management of upcoming issues and preparation for future challenges.

While IT automation is already widely used by IT departments and managed IT service providers, it is continuing to evolve as the lean operational mindset impels developers to create autonomous systems that require ever less human interaction – although even now automated systems require IT professionals to create and implement certain elements, like scripts, policies, templates and workflows.

MSP tools include some level of GUI- driven automation that enables MSPs to automate specific tasks in specific pre- defined ways, such as automated patch management and automated AV scanning.

So, all MSPs are automating to some extent. However, there is massive variability in MSPs’ ability to deliver automation at scale.

Many MSPs face difficulties in building custom, complex automations: technicians may not have the skills to build robust, reliable scripts for deployment in customer environments; and moving beyond basic script deployment to complex, multi-step automation requires project management skills that may be lacking.

TR: What activities should MSPs look to improve through automation?
AS: In theory, automation can be applied to just about any IT task, but when getting started it’s most effective to target manual tasks that are easily repeatable and time- intensive. Patch management, backup management, and software deployment are all prime candidates for automation that can be completely managed by most RMMs.

TR: What are some of the limitations or drawbacks of automation?
AS: There are always trade-offs when it comes to automation. Scripts and policies that automate IT tasks can be pretty inflexible – they’re built for a single purpose and are very good at doing that one thing; IT automation systems still need to be configured and maintained, which has a cost and skill requirement; and It’s very important that automation systems are configured properly from day one and that the dangers of errors, no matter how small, are thoughtfully balanced out against the benefits.

Automation doesn’t eliminate human error. And since you really want to avoid bugs in an automated system, this is an important consideration to keep in mind.

TR: Are there more fundamental barriers to the wider use of automation? And, if so, what might they be?
AS: Fear of change is a factor. Organisations have spent years refining their internal processes, getting them to be as efficient as possible, and despite the obvious benefits and increased efficiency of automation, businesses are sometimes reluctant to change their processes in case doing so negatively impacts productivity in some way. The old saying ‘if it ain’t broke, don’t fix it’ can be a barrier to change.

That said, just because an MSP is looking at implementing automation technology doesn’t mean they have to overhaul everything at once. A good place to start is with something simple, such as patch management or data backup, and once those have been automated successfully to go on from there.

Another potential barrier is the idea that new and sophisticated automation technology will come with a high initial capital outlay, both in terms of the technology itself and the internal training required to utilise it. While automation usually reduces costs in the long term, some do still have upfront costs relating to deployment and configuration of the hardware, although many have now moved to a subscription-based model. It’s important to balance the amount of time and resources that will be saved over time against these upfront investments and any costs involved in maintenance and future upgrades.

People might be concerned about a lack of flexibility in automation – sometime you can’t beat the human touch when things go awry, processes break down or ghosts appear in the machine; and lastly, there is the fear that automation is there to take over people’s jobs and lay-off staff. This isn’t the case, and actually, technology can supplement the roles humans play and help them become more productive.

TR: Consolidation continues to be a big movement in the MSP market. Do you expect this to continue and what do you see as the pros and cons of this trend?
AS: The demand for managed services has never been greater and more MSPs are entering the industry every day. Moreover, with remote working and increased connectivity, geography is no longer a barrier to collaboration or partnership, so I think consolidation and acquisition as a method of growth will continue to be a trend over the next year, fuelled by a desire for growth as well as talent shortages.

Consolidation and acquisition will be necessary to find and acquire the talent needed to service clients. Some MSPs are choosing to consolidate and focus on one or two specific areas that they know they have a good base of talent in, while others are looking to expand through acquisition, especially those owned by private equity.

The main way such firms grow exponentially in the MSP market is to expand horizontally into new product areas that increase wallet share. These ‘growth through acquisition’ plays negatively impact MSPs by stripping innovation and dedicated development resources from the market and by destroying competition. Acquired technology never ends up with a truly single-pane product that delivers on the promised value of a unified platform.

Expansion through organic development creates opportunities for more automation, better visibility and a unified workflow that delivers radical improvements to MSP efficiency. It also leaves greenfield space for competition and innovation that gives MSPs more choice. Our goal at NinjaOne is to continue to develop proprietary solutions (we’re builders not buyers) based on market needs and customer requests.

Some customers are looking for a ‘one-stop-shop’ with managed information security and IT services combined. And big may sometimes be better in terms of being able to provide a ‘full-service’ offering to those clients that want it. It can also bring benefits such as greater access to resources, wider skills and greater depth of skills in the workforce. Limited access to capital can cause MSPs to fall behind when it comes to offering the latest skills, technology and resources, and acquisition can give them access to far greater investment.

On the flip side, smaller MSPs can offer greater agility, greater attention to detail and access for clients. They are also more able to serve niche markets and offer greater expertise in specific areas. There is room for both within the market, depending on a client’s needs, and the market will continue to grow in both areas.

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What to look for in a managed IT services provider

  1. Availability and responsiveness
    Make sure the MSP is available throughout the day. A business’s IT environment needs to be in good health and operating efficiently at all times. Make sure they continuously monitor your IT infrastructure and respond in a timely fashion when issues do arise.
  2. Future IT planning
    A good managed IT services provider helps plan for the future of an organisation’s technology. This can include yearly budget planning to look for ways to save money and enhance technology in the workplace. Look for an MSP that has the knowledge to help a company scale its IT assets as it grows.
  3. Efficient planning for tech and data disasters is another skill to look for. The University of Texas found that 94% of businesses that experience catastrophic data loss do not survive more than two years. MSPs should assist in creating a disaster recovery plan to make sure the client can stay in business, even after a data disaster.
  4. Security skills
    Security is a top priority when searching for an MSP. An MSP can oversee backups by making sure they are performed correctly and checking them periodically to confirm all data has been backed up. A managed IT services provider should also help prevent, detect and quickly respond to cyberattacks. To help them in this security process, MSPs can either use an EDR vendor or recruit the help of a SOC or MSSP.
  5. Tools and vendors
    Every MSP will use a different tool stack and many integrate with
    or utilise services provided by third-party vendors to increase their coverage of IT services. It’s important to know what they’ll be using to monitor and maintain your systems. The tools they use should meet the needs of your organisation. For example, you may need backups that are done offsite and remotely. Increasingly, many workplaces have employees who work across distributed environments. If that is the case in your organisation, it’s important that the IT set-up you choose is optimised for those needs. Other factors to take into account are the type of operating systems the MSP supports, the number of devices they will oversee, and their management style (remote or in-person).
  6. Proactive monitoring and maintenance
    A good MSP continuously monitors device and system health within
    a client’s IT environment. They also apply updates promptly to ensure that mistakes or errors in software are not exploited by outsiders.
  7. Past performance and expertise
    Find out what you can about an MSP’s experience and track record.
    If you know people who’ve used a specific MSP, ask them if they were satisfied with the partnership. You can also ask MSPs about their experience in managing IT infrastructures in industries similar to your own, and whether they’ve assisted businesses with disaster recovery.
  8. Pricing
    One of the top benefits of managed IT services is predictable costs. Choose an MSP that provides the IT services you need at a price that fits your company’s budget. If the cost seems high, keep in mind that you are paying for proactive management with predictable prices rather than replacing things as they break.
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