Skip the Root Canal: Why MSPs Should Invest in Streamlining and Automating the Autotask Invoice Process
Invoicing sucks. Most MSPs hate it. But no matter how much we avoid it, whine about it, and complain about it, we all know we must do it. At least if we want to keep eating. Sounds like a root canal, doesn’t it?
We hear stories all the time from MSPs who are too busy working tickets to invoice, or just put it off because it’s such a pain. (no, you shouldn’t invoice a Client for work you did 6 months ago). Larger MSPS aren’t immune – A lot of the “help us” calls I get are about Owners and Office Staff spending 3 weeks of their lives to get all the bills out and everything processed. They’re drowning!
And that’s just getting the invoices out. How do you know they are accurate? Nobody wants upset Clients, so you try and avoid billing discussions by giving away a little here and a little there. Or you just take a guess on the hours worked as no one has time to enter time as you do the work. Of course, since you are guessing you don’t want to risk overcharging and getting yelled at
That little bit here and there adds up.
Most MSPs we talk with admit they are leaving $$ on the table. However, they are unsure how much they are lighting on fire,, what to do about it, and whether it is really worth the hassle of Streamlining or Automating the Invoice Process just to provide more Accurate Invoices to the Clients. Isn’t “close enough” or “best guess” just fine for your Clients? If you’ve had a billing issue with Kaseya then you know the answer.
So what do you do about it
Based on Advanced Global’s experience, most MSPs are leaving 5-15% of MRR on the table in the form of uncaptured billable hours that are being written off as Managed Service Support. So, take your Annual MRR, multiply it by 5% and if it is more than 4K USD then from a profit point of view it is well worth it. If you take the same calculated # and divide it by 4K USD, you have your return on investment, and my bet is that it is between 6 and 10X.
But what about the weekend hours you give up processing A&P. If most of your time is cleaning up incorrect Time Entries, when you could be out playing with the kids or enjoying life, then the value of Streamlining the Labor Invoicing is priceless.
So, when we say “captured billable hours that are being written off as Managed Service Support” what are we talking about? Project work, Emergency Afterhours work, and sometimes Onsite work depending on the MSA. According to Gary Pica of TruMethods fame, 30% of your aggregate MRR should return in the form of Project work if you have a good preventative maintenance program. And that makes sense. If technology needs to be refreshed every three years, then 30% of your Clients are facing a refresh project every year, and it is the preventative maintenance program that identifies which Clients are scheduled for this year.
So what are the steps to Streamlining and Automating Labor Invoicing?
They are quite simple:
Understanding what is in the MSA and verifying who are the Managed Service Clients level by level
Understanding the purpose of Roles and Work Types and making adjustments based on what is in the MSA agreements
Configuring the Autotask Cascading Contract Automation
Rolling out the Automated Contracts to the Clients
All at Once
At renewal Time
Combination of the two
For some of you, those 4 steps are an “ah ha!” moment and you are already starting that email to your staff. I wish you luck. Please post on the Gladiator’s Community about your journey and if you need any help. I love to hear success stories.
Some of you may have a perfect Zen-like invoicing system in place. If so, I would love for you to also post on the Gladiator’s Community so others can envy you and learn from your experience.
The rest of you are thinking how painful those 4 steps would be to implement, and that it’s probably easier just to suck it up and keep doing what you are always doing and hope the pain doesn’t get any worse. Did you know that if you have a toothache and you ignore it a simple cavity can then require an expensive root canal? And if you ignore that you need to have the tooth pulled? I think you see where I am going with this. And continuing to speak on root canals – modern dentistry technology makes them easier, quicker, and relatively painless. You just need to use a dentist that has made the investment in the knowledge, technology, and techniques to get you in and out in an hour.
So, how about you?
How much is your inefficient invoicing process costing you? Do you have to skip billable hours to work on invoicing? Does your staff hate the process? Would you rather be home with your family or out fishing rather than going over all those numbers? Do you dread hearing from the Client after you send out that invoice? Do you just wish you could send an email and have that experienced MSP dentist with the knowledge, technology, and experience work with your team to understand the pain, develop a plan to fix it for good, and then work with your Team to implement?
Well, that’s pretty much what I do. I show your Team how to bring in more money while taking better care of your Clients. I know times are tough, so if we’ve spoken in the past and cost was a barrier, then check again. In an effort to help, I’ve got some summer deals going and have also revamped some of my most popular programs to be video based “go at your own pace.”
Help is just an email away: Info@AGMSPCoaching.com.
About the author:
Steve is an MSP Industry Continuous Operational Improvement thought leader who’s Personal Mission is “Helping MSPs see the Light.” and Believes:
Maximizing Service Delivery Efficiency is Achievable
Creating and Maintaining a Zen Work Environment is Achievable
Streamlining, and Automating a very Accurate Invoice Process is Achievable
Having Raving Fans who are Driving Sales is Achievable
The Freedom to "Go Sell Something" and Grow the Business is Achievable
In being Home for Dinner, taking Vacation, and Improving your Gaming Score is Achievable
Join the fight with us to drive the Chaos out of the Operation so that
Techs have a Zen Work Environment
Clients are Raving Fans
Profits are maximized
You are Home for Dinner, taking Vacation, and Improving your Gaming Score
Steve and Co