ServiceVAR CategoryCore Revenue Source Resell Product Time & Materials Traditional VAR Product Sales Support Product Product To Pull Technical Services.

Office 365:Making Money With Managed Services

Jeannine EdwardsDirectorConnectWise Community

CLD03

Lisa SlimMicrosoft Alliance Business Manager

Hewlett-PackardMPN partner since 1989HP Enterprise Business

Ro Kolakowski

Company Partner

6th Street Consulting

MPN partner since 2006

SharePoint

How We Will Spend Our Time TogetherWe’ll look at…

Why Managed Services is essential to the profitability of your cloud business

Which key business components add the most leverage for an MSP

What 5 actions you can do to build your managed service practice

Source: Everything Channel State of Market, 2010

The Typical Managed Solution Provider

25%

21%

54%

Hardware

Software

Services

Time In Business 8 Years

Length Of Customer Relationship

7 Years

Revenue From Existing Customers

72%

# Of Customers 180

Vendors Per Technology Category

2-4

$3.3M Total Gross Revenue

May Resemble One Of Four Business ModelsService VAR Category Core Revenue Source

• Resell Product Time & Materials Traditional VAR

Product Sales• Support Product

• Product To Pull Technical Services

Solution VARProject/

Professional Services• Technical Services To Pull Product

• Professional ServicesMSP / T&M Hybrid VAR

RecurringService Sales• Professional Services To Pull Technical

Services

• Independent Software VendorSolution VAR Consulting

• Consultant/Influencer

Recurring Service Sales

• Predictable annuity based revenue

• Consistent use of resources

• Manageable budgets

• Pro-active opportunities

• Sticky relationships

• Increased company valuation

Resell

Managed Services

Cloud

Resell

Managed Services

Cloud Business Is Just A Managed Service

• Customer Relationship Management (Updates, etc)

• Ent. Application Management (Line Of Business, Server Side)

• Desktop Application Management(Microsoft Office)

• Network Infrastructure Management (Routers, Switches, etc)

• Help Desk

Top Managed Services

• Tools(BDR and antivirus)

• Applications(Hosted Exchange, hosted SharePoint)

• Infrastructure(Storage, data storage, security)

• Virtual Desktops(End user experience in the cloud)

• Vertical Market Software(healthcare, financial, legal)

Top Cloud Managed Services

If it can be monitored and managed...it can be put on a contract

Key Leverage Points Determine Success

• Expand To Larger Customer Base

• Initiate Longer Contracts

• Set Minimums, Charge For Value

• Radiate Your Services

• Aim For Shorter Sales Cycles

• Improve Service Process Efficiency

• Automate With Tools

• Remote vs. Onsite

• Develop Repeatable Business Processes

• Drive Sales Efficiency

• Implement Effective Comp Plans

• Outsource or Partner for “A”

• Maximize Billable, Minimize Support

Drive More Revenue Minimize COGS Control Expenses

Back to Basics: Revenue – COGs = Gross Margin – SGA = Net Profit

MSP and Cloud Profitability: The Big FiveDefine & Execute A Strategy For Growth(Don’t “Wish” It)

Sell Beyond the IT Department (Paradigm Shift)

Pursue New Technology Solutions Opportunities (RMM + Cloud Offerings)

Invest Back Into Your Service Capabilities (Professional Service Automation)

Tune Your Skill Set Mix(Evolution Not Revolution)

Source: CompTIA/MSP partners

Recurring Revenue Practice

Define & Execute A Strategy For GrowthMSP & Cloud Profitability: The Big Five

Who Owns…

• What we sell & how we package It

• How we migrate customers efficiently

and effectively

• What skill set we invest in

• How we drive profitability

• Where we’re going and what we do

• The customer relationship

• Customer satisfaction

• How visible we are the customer

• Customer support

• How we evaluate our approach and evolve accordingly

Back End Support

Process/ Infrastructure

Service Delivery

Business Management

Planning & Strategy

Finance

HR

Admin

Customer Engagement

Marketing

Sales

Implementation

Support

Technologist

Business Advisor

Shift Your Paradigm

Cu

stom

er V

alu

e

Business Evolution

Technologist

• Here’s how the technology works

• Implement…and Manage

Business Analyst

• Understanding Business Objectives

• Creating Efficiency and Productivity

Business Advisor

• Stickiness

• Sustainability

• Grow their business…and yours

Business Analyst

• Trusted Advisor Relationship

• Helping Customers Proactively Manage Risks & Costs

• Unique understanding of Specialized Technologies• Exceptional Technical Support

• Fast Turnaround and delivery

• Trusted Advisor Relationship

Pursue New Technology Solutions

+Remote Monitoring & Management Cloud Offerings

Without ConnectWise

ChaosWith ConnectWise

Control

Invest In Service Capabilities

The Impact on Your Business: Technology

Managed Services

68% 72%

Invoicing

51%59%

PSA

60%69%

RMM

42% 46%

SLA

65% 65%

Systems Management

57%63%

TroubleTicketing

Average

BIC

CloudAverage

BIC42%

68%

46%

62%

48%

65%

38%

62%51% 56%

45%56%

Invoicing PSA RMM SLA Systems Management

TroubleTicketing

Technology Adoption Rates:Increase Of Best In Class Compared To Average Companies

The Impact on Your Business: PSA

Anticipated Revenue Growth: Next 12 months

Decline Maintain Moderate Hyper-10%

0%

10%

20%

30%

40%

50%

60%

Average

5-15% >15%

19%

1%

13%9%

34%

54%

34% 36%

Tune Your Skill Set MixTraditional Solution

Provider Managed Service Provider Cloud Integrator

4. Marketing

1. Technical: Monitoring

5. Technical: Monitoring5. Marketing

2. Marketing

4. Sales

2. Sales

3. Sales 3. Business: Consulting 3. Business: Consulting

1. Business Consulting

2. Technical: Consulting

4. Technical: Consulting

1. Technical: Break/Fix

5. Technical: Break/Fix

MSP and Cloud Profitability: The Big FiveDefine & Execute A Strategy For Growth(Don’t “Wish” It)

Sell Beyond the IT Department (Paradigm Shift)

Pursue New Technology Solutions Opportunities (RMM + Cloud Offerings)

Invest Back Into Your Service Capabilities (Professional Service Automation)

Tune Your Skill Set Mix(Evolution Not Revolution)

Source: CompTIA/MSP partners

Infrastructure

Vendor Management

Professional Services

Internal IT Department

Security

Remote Monitoring and Automation

Voice Networking (VoIP)

Help Desk

Software as a Service (SaaS)

Storage, Backup and Disaster Recovery

Digital Signage

Hardware as a Service (HaaS)

Surveillance

Email Management and Administration

Telepresence

Printer Management

Website Management Mobile Telecommuting Cloud Services

Office 365 Go Do’s

At WPC After WPC Moving Forward

Enroll In Cloud

Essentials

Learn About Office 365

Determine How You Fit

Build An Attached Service

Business

QuickStart for Microsoft Online Services: A partner onboarding experience

www.quickstartonlineservices.com

© 2011 Microsoft Corporation. All rights reserved. Microsoft, Windows, Windows Vista and other product names are or may be registered trademarks and/or trademarks in the U.S. and/or other countries.The information herein is for informational purposes only and represents the current view of Microsoft Corporation as of the date of this presentation. Because Microsoft must respond to changing market conditions, it should not be interpreted to

be a commitment on the part of Microsoft, and Microsoft cannot guarantee the accuracy of any information provided after the date of this presentation. MICROSOFT MAKES NO WARRANTIES, EXPRESS, IMPLIED OR STATUTORY, AS TO THE INFORMATION IN THIS PRESENTATION.