The Greatest Story Ever Told (by me):Process Improvements for MSPs

Hello Autotask Warriors. Some of you may think the title above to be a bit pretentious. You might be right. But hear me very clearly: This is the most important article I have ever written for MSPs! I promise its worth your time!

“Eighty-five percent of the reasons for failure are deficiencies in the systems and process rather than the employee. The role of management is to change the process rather than badgering individuals to do better.”

https://www.azquotes.com/author/3858-W_Edwards_Deming

Pause for a moment and let that sink in. Did you achieve your process improvements last year? Did you meet your sales goals? Profit goals? ANY goals? How does that feel?

We spent last year going over a proven system to grow your MSP and I am still running into MSP owners ready to give up because, “it just isn’t working!”

Enough is enough! MSP Owners deserve to make a profit and have a decent life and so do their employees!

Folks, this is not so much a math problem or “having the lobes of the Ferengi” as it is a process problem. Let’s fix this NOW!

Process Improvements goes by several names:

· Maximize Efficiency

· Leverage more of the PSA Automation

· Freedom to grow the business

Even more names on the tactical level:

· Making sure the Tech know what to work on next

· Projects ending on time and on budget

· An Automated invoicing processes

Achieving these Strategic or Tactical goals takes Process Improvement initiative/program/goals Research says that 87% of us did not achieve our 2023 goals. Why not?

Based on Clifton Butterfield and HDI, there are three things that failed improvement programs have in common:

1. No plan or roadmap on how to achieve the Process Improvement goals

2. No Success Criteria so as to know where you are going and when you arrive

3. No Champion to hold everyone accountable to stay focused, energized, and to carve out time out of a busy work week to execute the plan

Is this you? Be honest with yourself. It’s okay – I’ll explain all three right now.

So, what does a Plan or Roadmap need?

· Specific Standard Operating Procedures (SOPs) improvements to implement

· Tool changes to support the SOPs

· Data to Set Benchmark, Track Results, and Guide the SOP implementation and/or improvements

Hold on…breathe….use a paper bag if you need to….these sound harder than they are. MSPs always want a boilerplate plan, so keep reading as it’s coming.

So, what does a Success Criteria look like?

If full operational optimization is the desired end goal, or at least the general direction of operational efficiency improvements, then we strongly recommend borrowing from LEAN Process Profitability KPIs:

· Inventory => Billable Hours or Resource Utilizations

· Throughput => SLA or Mean Time to Resolve (SLA w/o wait states) Performance

· Efficiency => Reactive Hours per Endpoint per Month

However, these are the result KPIs to determine if you are heading in the right direction or even achieved Operational Optimization. Where we need to focus is

on the leading indicators. The leading indicators for each area of an MSPs operation (Sales, Finance, Back Office Support, HR, Project Management, and Service Delivery) are all different.

(I said KPIs – many of you want to tune out – it will be okay – keep reading)

For the Service Delivery Area (we start here because Labor is the biggest expense, and there is usually more labor on the Service Delivery Team than any other Team) leading indicators can be grouped into three areas:

· Intake and Open Ticket Management

· Tech Performance

· Client Experience (CX)

Intake and Open Ticket KPIs:

There 9 leading Dashboard KPIs in this area that should be check at least once per week:

#1 New Tickets sitting in the Triage queue:

#2 Coming up on Next SLA Due Date - Overdue:

· Triage

· Tech Engagement

· Completion

#3 Waiting … with last Activity date greater than 2 days ago

#4 On Hold with past Due Date

#5 Maintaining the Ready to Engage widgets - no tickets Next SLA Due Date more than 24 hours past due

#6 All Open Tickets greater than 20 per Tech

#7 Tickets requiring scheduling without Service Calls

#8 Non-Triage, Alert or NOC tickets unassigned

#9 Worked Hours greater than the 2X of Estimated Hours

And a few Autotask Advanced Live Reports

#1 Scheduled Tickets with No Future Service Calls

#2 Backlog List of Tickets (BLT) greater than 5 per Tech

#3 Advanced Workflow Distribution report

#4 Advanced Service Delivery Forecast report

#5 Advanced SLA Performance report

(if your chest is tightening and the panic attack is coming, take a moment and breathe…eat these like an elephant – one byte(or just a Nibble) at a time. My team is here to help. Keep reading - your team deserves it.)

Tech Performance KPIs:

Typically, there are 9 Advanced Live Reports in the Tech Balanced Scorecard, and then a cumulation score for the month, qtr. or year. These should be run monthly, and many MSPs use it as a bonus or profit-sharing criteria at the end of the year.

1. Resource Utilization

2. Real-Time Time Entry

3. SLA Tech Engagement performance

4. Mean Time to Resolve

5. Escalation Rate

6. Re-Open Rate

7. 1st Contact Resolution

8. Backlog List of Tickets

9. CX score

10.Cumulative Score

CX score KPIs:

· Following the Client-Facing Communications Protocol

· Company Real-Time Time Entry average delay

· Client Survey Score

(Breath…use that paper bag…take several deep breaths…you can absolutely do this…you are not alone)

So, what does a Champion need and need to do?

The first thing that comes to mind is accountability. But in reality, they keep the energy up throughout the program, make sure everyone on the Team is focused on their part, and carves out time to meet their commitment due dates.

The Champion (or Guide on the Side) also tracks the metrics and lets the Team know how they are doing. They are responsible for maintaining the plan/roadmap and document collaborations changes from the original vision.

On yea, they also hold everyone accountable, including themselves to make sure the program is completed on-time and on budget.

(“OMG – I can’t do this alone…Working 100 hours a week in the MSP has got to be easier, right?” Stay with me – you’ve come so far. I’m going to show you my plan right now)

Why should we care?

The results of an Operational Efficiency Improvement Program are significant and usually return 6-10X of the investments. Here are some specific returns that you can expect for an average 6 Tech Shop:

a. Resource Utilization: for 6 Techs and an SRR of $150, a 10% improvement means you can sell an additional $187K per year in MRR or Professional Services without hiring another Tech

b. Advance Contracts: Capturing 5% more of Non-MSA billable hours that today are being written off as Managed Service Support could net $7,533.30 per month in additional T&M billing

c. Sales Dashboard and Opportunity Training: Increase Sales efficiency by 10%, yielding another $18,683 per month in revenue

d. Building a Better Client Experience: In one Client with 103 Managed Service Clients, reducing Churn by 50% was worth $240 per Client or $24,720 per year.

Example: Bundled all together: $28,299 per month, or a whopping $339,588 per year.

Wrap-Up

Thanks for staying with me. I imagine many of you are 30 seconds from cardiac arrest as “this sounds so hard,” “I don’t have 6 Techs”, or I’ll just never grow.” ENOUGH! I’ve got the plan and Team to help you. You can take my boilerplate above and DIY, join our Gladiator’s Community for guidance, or you can work

hand in hand with my team to grow your MSP and build a Happy Team with raving fan Clients. Embrace the Suck! Get ‘er done. You can do this!

Advanced Global’s Process Improvement for MSP in a box program:

Drive to Thrive:

1. Intake

2. Categorization

3. Triage

4. Tech Allocation & Scheduling

5. Prioritization

6. Service Coordination Dashboards, Introduction and Training

7. Tech Dashboard Lunch N’ Learn

8. Other

Streamlining Labor Invoicing:

1. MSAs

2. Roles and Work Types

3. Contract Templates

4. Cascading Contract Template

5. Copying Contracts into Client Accounts

6. Client Facing Contracts

Building a better Client Experience:

1. Clear, Concise, Client Friendly Notifications

2. Automated Client-Facing Communication

3. Tech Ed

4. Real-Time Time Entry Culture Change

5. Internal Testing

6. Pilot Group Rollout, Feedback, and Adjustments

7. All Client Rollout

Service Delivery Gladiator’s Community: Home - The Service Delivery Gladiators (agmspcoaching.com)

Unshackled e-book: https://www.agmspcoaching.com/unshackled

(Learn how to apply the 6 keys to MSP Service Delivery Optimization)

Talk to me: info@agmspcoaching.com

Steve & Co.