From The Editor | August 11, 2017

Cloud Services Isn't Ready For Primetime

Matt Pillar

By Matt Pillar, chief editor

Cloud Services Isn’t Ready For Primetime

And other misinformation observed by a managed services pioneer.

Jason Shirdon is VP of operations at Ease Technologies, a 53-employee managed services company in Baltimore. He’s been there since 1999, having joined the company when it was just seven years old and back when managed services wasn’t even a concept.

Shirdon is in part responsible for the fact that managed services is far more than a concept today. Some five years before Karl Palachuk and company began advocating for the managed services business model in 2005, Shirdon was implementing it among Ease Technologies clientele. He and his colleagues at Ease just didn’t know what to call it back then.

Shirdon was among the first with enough audacity to build a structured process around project execution, routine and proactive maintenance using a fixed monthly pricing model. I like to think of a pioneer as someone who does something really important first, without necessarily knowing just how important that something is.  That’s a pretty good way to summarize what Jason did for Ease Technologies, and indirectly, for the channel.

But to talk with Jason about his role on the managed services timeline is to talk to a man with zero semblance of a self-important attitude. His retelling of events is matter-of-fact. “When I got here we were kind of your traditional IT consulting company looking for hours to bill,” he says. “I told Chuck (Bubeck, the company’s President and CEO)  early on that there had to be a better way.” Not only did Shirdon conjure up an all you can eat model of service provision on 100 percent recurring revenue, he mapped out the transition that got Ease Technologies to that state without going broke along the way. “It’s been a great road,” says Shirdon. “Lots of fun. We’re still waiting for it to slow down.”

Ease is a classic MSP. It offers an array of IT services, primarily to companies with staffs of anywhere from 25 to 100. For most of those companies, that employee count includes zero IT staffers. That equates to some fundamental IT blocking and tackling needs on the client’s part. “We’ve been handling some of the same core IT processes for clients that have been with us for 18 years,” says Shirdon. “In many cases, the fundamental problems we’re solving are the same. In almost all cases, it’s the tools in our toolbox that have changed. They get fancier, more streamlined, and more cost effective every day.”

Determining how to monetize those tools by articulating their value to clients is where many providers fall down, says Shirdon. Faced with too much objection, many choose to fight against technologies like desktop as a service and cloud security, instead of for them. “We compete with a lot of smaller MSPs that don’t have a cloud desktop services offering, and they tell our clients it’s not ready for primetime,” says Shirdon. “That’s misinformation. Four years ago, we supported 100 Microsoft Exchange Servers. Today, we have two.” News from Microsoft supports Shirdon’s claim. Last month, it announced that its subscription-based Office 365 online workplace tools brought in more revenue than its traditional on premise licensed version of Office.

Ease Technologies saw it coming. Early on, the company restructured its line card to ensure that its consulting services were separate from its service and support of Microsoft licenses. Shirdon says it’s pointless to fight cloud services in an effort to hang on to legacy application deployment and service revenue. Instead, he says, make sure you’re getting paid for consulting, not just the ones and the zeroes. So many MSPs I speak with—sophisticated, operationally mature, well-staffed MSPs—abashedly admit that they’re giving away this knowledge, this concrete intellectual property, for nothing. A few defend their refusal to define and “line card” consulting services by labeling it their “value add.”

If that’s you and you’re staying afloat, I suggest you assess your risk of pricing yourself out of play for implementation, service, and break/fix opportunities. In this market it’s the knowledge, leadership, and consultancy you’re giving away that’s most valuable to your customers. Here’s a thought—make a monthly on-site visit by a friendly tech your “value add” and charge what you deserve for your intellect.

Shirdon says it learned two important things when the company started listening—really listening—to its customers’ wants, needs, and desires. “The most recurring themes we hear are that they want predictions or insight into where IT is going, and they want to know how much they’re spending to get there.” That’s a perfect recipe for the consultancy-driven sale of subscription-based managed services.

Shirdon lauds the support of the channel-centric vendors that are crafting “X–in-a-box” solutions that MSPs like Ease Technologies can spin up quickly on a subscription basis. Ease is a Kaseya Powered Services partner, and it’s an early adopter of the vendor’s recent security as a  service offering.

“We knew we needed more login security and audit trail capabilities,” says Shirdon. “Just three years ago we offered two-factor authentication and a password library. As the business tools we sell got better and moved to the cloud, we had more to manage online.” Shirdon says in this era of hyper-security awareness, two-factor authentication, the ability to securely log passwords, and maintenance of an audit trail is sellable in itself.  The secure management of those credentials as a service is often the deal-sealer, especially in such dynamic end user application and device environments. “The markets are looking for answers to their security unknowns,” says Shirdon. “Being a thought leader keeps us relevant to the client. It’s a differentiator for us.”