What is the difference between a profitable MSP and an unprofitable MSP?  One of the major differences is Efficiency.  If I can provide the same services as my competition, but do it for lower cost, then I might survive a little longer in my market place than my competition.  Duh.

So tools, hardware and software, can help you achieve higher efficiencies.  This is true...but, the real differentiator is HOW you use your tools that will set you apart from your competition and drive more profitability for your business.  The tool itself does not define this for you.  You must know exactly what your business needs in order to choose the proper tool

For example, having acquired a PSA (professional services automation) tool will not automatically make you efficient and profitable.  A PSA tool most certainly can transform a business, but it can't do it merely because you paid for it.

You still need to know what your business does, how it does it, and what areas need improvement.  Once you know these things, you can then map your needs, workflows, and requirements to your PSA tool.  Therein lies the power of implementing any tool for your business.  Know thy self, know thy business.

To start, these are some of the things you need to know about yourself and your business before you can really grow, add tools, add staff, add clients:

·         What you're good at as individuals and as a team

·         What you're not good at as individuals and as a team

·         What business you are really in

·         What goals you have personally and for the business

·         What an income statement is and what it means, and why cash flow is important

·         What areas of your business have documented workflows and which don't

·         What your profit centers are

·         What your core competency is

·         What your client acquisition and revenue goals are

·         What your CRM, Service & Support, Communications, Resource Management, Human Resources, Sales and Marketing, Project Management, and SLA requirements and workflows are.

·         What your service offerings are

·         What your costs are

·         What your gross margin is

·         And more…

So, the hard part isn't deciding that you might need a particular type of tool, but rather analyzing your business and knowing why you need the tool and how you're going to use that tool to inject efficiency and profitability into your business.

So, once you know your business and can answer the above questions, but before you chose any tool you have to be able to answer some fundamental questions:

1.  Does this tool solve a problem for my business or my client?

2.  Will this tool inject efficiency into my business?  Will it lower costs, provide a new revenue stream, etc?

If the answers are "yes," then you need to dig deeper.

1.  What will this tool cost?

2.  What's my ROI and when will it be achieved?

3.  Will this give me a competitive advantage in my marketplace and for how long?

4.  Do I have the technical skill in house to implement this solution or should I outsource some or all of it?

Once you have answered all of these fundamental questions then you will be able to look seriously at the available tool sets and map their features/benefits to your needs.  Then, and only then will you be able to create the solutions and tool sets that will set you apart from your competition and ultimately increase your revenues.