Growth Culture For MSPs: Rethinking My Position on the ‘Startup’ Mentality

Over four years ago, I published an article on SmarterMSP about integrating startup culture into a Managed IT business. I’ll never forget that article, because it was one of the first times that I published something that got an immediate “reaction” from members of the IT community. We had just launched this blog a few months prior and mostly to the sound of crickets, so finally getting feedback from readers was exactly the high we needed at the time to keep publishing. 

While it makes for a delightful story, looking back on it now, the article itself seems a little disjointed. I still agree with the general premise and the anecdotes ring just as true as they did back then, but there are major points of emphasis that I missed or brushed over without the depth that they deserve. This could have been due to lack of time and effort, but most likely it was because I didn’t have the knowledge that I now have, four years (and 2 more start-ups) later. 

For all of these reasons, I want to give this topic another go, but this time I hope to really connect the dots in a way that I did not before and in a more organized fashion. I will do this by clearly drawing the intersection between the values of a start-up and the characteristics of an MSP and how one can apply this ideology to their business immediately:

Values of a Startup

Let’s first start by introducing what I believe to be the core values that make up the “startup mentality.” It’s not about what industry the company is in, how many employees they have, or what product / service they sell. These values can be applied to any business of any type, size, and maturity. It’s a mindset and a culture first and foremost, and one that often cultivates growth as a result. This is the special sauce. 

To truly embrace a startup mentality, one must have: 

• Customer-Focus – Startups often prioritize their customers above all else. They strive to deeply understand their customer’s needs and pain points, and aim to provide the best possible solutions for them. This often involves a heavy emphasis on customer service, engagement, and retention strategies.
• Speed & Agility – Startups tend to act and adapt quickly. They are built to handle uncertainty, pivot when necessary, and respond rapidly to changes in the market or customer demands. Traditional bureaucracies, long decision-making processes, and red tape are typically absent in this environment.
• Risk Tolerance – Startups, by their very nature, involve a significant degree of risk and therefore require risk-tolerance. Founders and employees are often willing to leave more secure jobs to pursue an idea they believe in, but only after properly evaluating risk versus reward. This risk-taking mentality also extends to the strategic decisions the company makes, whether that’s experimenting with new product features, entering new markets, or fundamentally changing the business model.
• Open Mindedness – Startup teams often keep an open mind to achieve the flexibility and adaptability required in such a rapidly changing environment. It enables founders and teams to absorb new ideas, accept and learn from failures, and pivot strategies as needed. Moreover, open-mindedness encourages a culture of innovation and continuous learning, crucial attributes for staying ahead in competitive markets.

Characteristics of an MSP  

Now that we have a good understanding of the mindset of a true startup, let’s just take a look at the construct of a Managed Services Provider. Typically, you can identify an MSP by the offering of very specific core services on a recurring basis. Bear with me as this will all seem a little obvious to those who walk in these shoes everyday, but defining these characteristics will prove to be important later on when we map these together. 

To characterize a business as an MSP, it generally provides: 

• Help Desk Support – Front-line Help Desk support is the most recognizable service offered by MSPs. It is also the most frequent touchpoint between the MSP and its customers. This service ensures that technical problems, whether software or hardware, are resolved quickly and efficiently, minimizing downtime and maintaining business productivity. 
• IT Project Management – MSPs often provide project management services to handle complex IT initiatives, such as system implementations or upgrades. This is the proactivity that can make a good MSP great. They bring structured planning and execution skills to the table, ensuring projects are completed on time, within budget, and in alignment with the desired outcomes.
• vCIO Consulting – vCIO (virtual Chief Information Officer) consulting involves providing strategic IT guidance at the executive level. MSPs offering this service help businesses align their IT strategy with their overall business objectives, offering insights on technology trends, cybersecurity, data management, and IT budgeting. This provides SMBs access to high-level IT expertise without the cost of a full-time executive hire.
• Vendor Management – MSPs often manage relationships with other technology vendors on behalf of their clients. This includes negotiating contracts, resolving service issues, and ensuring different technologies and services work together seamlessly. This service offloads the complex and time-consuming task of managing multiple vendors, allowing businesses to focus on their core operations.

Connecting The Dots

Now that we have a firm understanding of both the values of a startup and the characteristics of an MSP, let’s put them together and see what comes out the other end. I have conveniently aligned these in the order of appearance (and on a one-to-one basis) but you could draw these lines any way you wish. What is important is that we find tangible ways to introduce the startup values into our core offerings in ways to increase our likelihood of growth:

Customer-Focus ➡ Help Desk Support

Applying a customer-focused approach to your Help Desk is easier said than done. Most MSPs will slap on the “white glove support” label, meet their SLAs, and consider that an achievement in customer service. That’s the expectation, not the exception. The exception is meeting your customer where they are, even when it is inconvenient (or nearly impossible) for you to achieve. 

Here are a few ways to accomplish this: 

• Active Listening: Encourage help desk technicians to deeply understand the customer’s issues before providing solutions. This not only makes customers feel valued but can also lead to more effective problem-solving.
• Anticipate Customer Needs: Train the help desk team to anticipate potential customer issues and prepare for them. This proactivity can lead to faster resolutions and can enhance customer satisfaction.
• User-Friendly Solutions: Ensure the solutions provided are easy for customers to implement. If a solution is too complex, it could lead to more confusion and dissatisfaction, negating the purpose of customer support.
• Omnichannel Support: Offer multiple channels for support (e.g., phone, email, chat, social media, etc.) so customers can choose their preferred method of communication. Providing multiple options increases accessibility and convenience for customers.
• Value Customer Feedback: Regularly ask for, and genuinely value, feedback from customers. This information can be used to improve the help desk service, and customers will appreciate that their voices are being heard.
• Consistency Across Interactions: Ensure that every customer interaction reflects the company’s customer-centric values. Consistent, positive experiences will build customer trust and satisfaction over time.

Speed & Agility ➡ IT Project Management

IT Projects are an equalizer when it comes to MSP competition. When an MSP becomes “too busy” to complete projects, they are essentially falling back into the pitfall of reactive support, which is incredibly difficult to climb out of. Introducing more speed & agility into your project management will not only allow you to complete more projects in less time, but it takes immediate pressure off of other parts of your business. 

You might achieve this by introducing the following:

• Flexible Scoping: Allow for changes in project scope to accommodate evolving needs and emerging opportunities. This flexibility enables the MSP to pivot quickly, much like a startup.
• Early and Frequent Deliverables: Prioritize delivering early versions or parts of the project as soon as they’re ready, rather than waiting for a full, final product. This allows for quicker feedback and adjustments, improving project speed and relevance.
• Fostering a Fail-Fast Culture: Promote a culture where failures are seen as learning opportunities rather than setbacks. By identifying what doesn’t work early in the process, the team can quickly adjust and progress.
• Open Innovation: Encourage new ideas and solutions from all members of the project team, not just leaders. This can lead to faster problem-solving and innovative solutions, driving project speed and success.
• Short Feedback Loops: Implement regular check-ins and updates to ensure that everyone is on the same page and any issues are addressed promptly. This enables quicker adjustments and keeps the project moving forward.
• Time Boxing: Use time-boxing strategies, such as sprints in Agile methodologies, to limit the amount of time spent on each project stage. This encourages focus and quick execution, helping to maintain project momentum.

Risk Tolerance ➡ vCIO Consulting 

We tend to glorify startups when it comes to their risk tolerance by focusing on these mental pictures of living on a ramen noodle diet and sleeping on a futon. What we often miss is the Founder’s confidence to make these decisions and live with the result. This is why I believe that all vCIOs should have a similar stomach for risk, because it will give them the confidence to produce tangible outcomes (rewards) for their clients. This is opposed to what I see many MSPs do now with this offering, as they are all too concerned with checking boxes (thus introducing more costs) and forget that the goal is to actually help their clients win. 

Here are some methods to introduce these ideas: 

• Rapid Prototyping: Encourage clients to adopt a rapid prototyping approach, where new systems or features are built, tested, and iterated quickly. This can involve a certain level of risk, but is also key to innovation and finding unique solutions.
• Embrace Change: Help clients create IT strategies that are flexible and adaptable, mirroring a startup’s ability to pivot quickly in response to new opportunities or challenges. This means not being overly risk-averse, but understanding that change often involves risk.
• Calculated Risk-Taking: As startups often take calculated risks to achieve growth, advise clients on taking informed, strategic risks with their IT initiatives. This could involve investing in new technologies or adopting new IT practices, which, while potentially risky, could also provide significant advantages.
• Innovation Focus: Promote an innovation-driven approach to IT, similar to the culture in many startups. While new ideas and technologies can carry risks, they also offer opportunities for competitive advantage. Proper risk assessment and mitigation strategies can help balance the scales.
• Resilience Planning: Foster a culture of resilience in the face of IT risks. Startups often operate in uncertain environments and must be prepared to deal with setbacks. Teach clients how to build resilient IT systems that can recover quickly from issues.
• Iterative Improvement: Encourage clients to adopt a culture of continuous learning and improvement in their IT operations. Startups often learn by doing and iterating, using failures as opportunities to learn and improve. This involves understanding and accepting the risks associated with trying new things.

Open Mindedness ➡ Vendor Management 

One of the fundamental truths of our lifetime is that technology is and will continue to be constantly evolving at a pace that only accelerates over time. What is useful and sometimes necessary today, may be obsolete tomorrow. It’s about time that MSPs have fully embraced this idea and introduced it into their vendor management practice. If you are still renewing the same three year vendor contracts and pushing a tech stack that looks like it’s from 2015 then you need to rethink your position on this. 

Consider introducing these strategies into your business: 

• Broad Vendor Landscape: Keep an open mind to using a diverse set of vendors rather than limiting to just a few known ones. This can bring new opportunities and innovative solutions that might not be available from existing vendors.
• Adaptive Contracts: Be open to unconventional or flexible contractual agreements that might be beneficial for both the MSP and the vendor. This can encourage creativity in finding mutually beneficial solutions.
• Cross-Industry Learning: Be willing to learn from vendor management practices in other industries. Best practices aren’t always industry-specific, and a lot can be learned from how other sectors handle vendor management.
• Embrace New Technologies: Stay open to adopting new technologies offered by vendors. While there’s a risk associated with trying new things, it’s also the source of innovation and staying ahead of the competition.
• Experimentation: Consider piloting services or products from new vendors on a small scale before making larger commitments. This approach allows for testing the efficacy of different vendors in a risk-controlled environment.
• Vendor Partnerships: See vendors as potential strategic partners rather than just service providers. When there’s a synergy in vision and goals, these relationships can lead to new business opportunities and innovative solutions.

I hope that this helps to close the loop on what it actually means to implement a growth culture into your organization. As you hopefully learned, this isn’t just a cool buzzword that gets clicks. These are true methodologies that we all can embrace to stay more competitive and become market leaders. 

One disclaimer that I would like to add, which was absent from the first piece I published, is that this is not a guide on how to make your company more profitable. In fact, you could almost say it is the opposite. The objective here is to grow your customer base as quickly as possible, and in a direction of their choosing, while punting the idea of profitability well into the future (in true startup fashion). If your primary goal is to make an income today, then this advice may not be relevant to you and it’s important for you acknowledge that.

If you would like to chat more about installing these values into your Managed IT Business, feel free to reach out via LinkedIn. I am happy to take a moment to talk you through it.