The COVID-19 pandemic accelerated the adoption worldwide of a “technology first” mindset among small- to medium-size businesses (SMBs). It made distributed and remote working practices mainstream and forced brick-and-mortar stores to use technology creatively to stay in business.
These changes were on the horizon, but the pandemic forced adoption of new technologies and techniques much quicker than experts had predicted just months earlier.
To be a “technology first” company means that a business uses technology as their most important competitive differentiator and asset. It’s a term used when the next incremental dollar of a business is allocated to technology investment over everything else, including marketing, personnel, and financing. Technology is king, and everything else is secondary.
For the MSPs that support this new breed of SMBs, this has meant a new way of working all while evaluating their service offerings and tech stacks.
During his recent keynote at Kaseya’s Connect IT Global conference in Las Vegas, Fred Voccola, CEO of Kaseya, said, “Technology for small- to medium-size businesses was already in the midst of a massive change. But then the pandemic afforded no choice, accelerating the shift to dependence on technology into overdrive.”
That’s not hyperbole. Think back to the spring and summer of 2020. Without notice, every SMB was forced to adjust — or face ruin. And not in a small way. If you’re running a restaurant or bar, you immediately had to adopt online ordering and delivery. What about gyms? They had to learn how to conduct workout classes online. Law firms and CPAs had to use Zoom with their clients.
All those changes required massive IT, security, and technology investments. Today, all those advanced technology-centric business functions used to survive are now being used to augment and add to previous business practices.
Fred continued, “Today, there’s no mistaking that technology is now first. What that means to every MSP and IT professional is that we are all in the right place at the right time. There has never been a better time to be doing what we are all doing.”
Great Opportunities Bring Great Challenges
Now that SMBs have reached that “technology first” threshold, the rapid change in business technology accentuates and accelerates four critical challenges for MSPs.
Challenge 1: Unprecedented Volume
We’ve all recently experienced a tidal wave of sheer volume. The amount of new technology, software kits, vendor relationships, and workload a technician must manage has increased to the point of becoming overwhelming. Because your clients have adopted this “technology first” mindset, vendors are pushing so many more tech solutions.
“Seventy-two percent of MSPs complain of vendor fatigue. There are just too many vendors to work with. But if you choose not to have a complete software kit to address your IT infrastructure and security needs, you will have gaps in your IT infrastructure. You’ll be behind,” Fred said.
Challenge 2: Needs Outweigh Budgets
The numbers don’t lie: 91% of owners of SMBs expect to substantially increase their tech spending over the next three years. 99.5% of MSPs say their customers drastically underestimate the actual spend needed to improve their technology infrastructure.
Because your customers are more engaged, they feel like they have more knowledge, and it’s more challenging because it affects the amount of money they want to spend. Even if they are willing to spend more, MSPs are still in the same spot of doing more with less.
Fred said, “Before the pandemic, there was an arms-length relationship between clients and MSPs. They would do whatever you recommended. Today, they’re directly engaged in the technology decisions, but practically none of them have any training in IT and security.”
Challenge 3: An Upside-Down Labor Market
Everyone knows just how tight the labor market is right now. But in the IT industry, it’s far worse. The technology sector is growing about eight times GDP growth.
“Today there’s actually a negative unemployment rate worldwide for IT and security professionals. It’s at a negative 2.1%. That means there are more positions than people to fill them,” Fred said.
This widespread labor shortage presents multiple challenges for MSPs. First, many MSPs are severely understaffed. This also means you’re expecting more from every employee. Second, hiring and retaining quality employees is difficult. Those who are truly talented are seeking upward mobility even faster. Third, as the market competition increases, the average cost for an IT professional has increased by about 18% a year.
There are just not enough trained and qualified techs to go around, which affects your client load and your bottom line.
Challenge 4: A Perfect Storm Of Security Threats
Fred said, “We’ve all read the news articles, and Kaseya has unfortunately experienced cybersecurity threats as well. These threats impact our systems and our data, so they impact our way of life. And we, as IT professionals, are the defenders of that way of life.”
The recent statistics are staggering:
- Approximately 28,000 documented phishing attacks per day
- Ransomware today is a bigger profession than Coca-Cola or Nike
- Ransomware attacks have increased 800%
We have essentially backed ourselves into a perfect storm to create the most cybercrime-friendly climate ever. And there are three factors driving it.
First, there is a low consequence for actions. Robbing a bank for $10,000 results in far more jail time than a hacker who steals $1 million from that same bank. Very rarely will any kind of cybercrime under a million dollars be seriously looked at because there are just too many breaches today.
Second, there’s a law enforcement deficit and a very low probability of being caught. Less than 3% of law enforcement resources are focused on cybercrime.
Third, anonymous currencies allow for easy and untraceable cyber commerce. One hundred percent of ransomware is conducted with anonymous cryptocurrency, which makes it impossible to follow the money.
How Do MSPs Respond To Today’s Unprecedented Challenges?
As a result of today’s “technology first” environment, MSPs are saddled with increasing business needs, security risks, unrealistic budgets, and a very tight labor market. These four challenges are squeezing many MSPs.
You probably have 30–40 functions you constantly juggle. Each of those functions requires professionals using tools and techniques that are all independent. And every time two different functions have to be done, efficiency grinds to a halt. While labor is short, businesses want more and security threats are everywhere. Those inefficiencies can tear apart an MSP.
“How do you deal with constantly being squeezed? At Kaseya, we do it with ease. It’s when you must do everything, do it more affordably, do it more efficiently, and do it in the most secure manner possible. And all of that can be accomplished with our IT Complete platform — the world’s only IT and Security Management Platform purpose-built for the multifunctional needs of MSPs,” Fred said.
To learn more about how IT Complete can help your MSP overcome today’s four challenges to better serve the SMB market, watch Fred Voccola’s keynote address from Connect IT Global: https://www.connectit.com/global/.