After barely turning a profit for years, and then finally realizing success one of the most common realizations business owners come to is that things turned around when they started working on their businesses and not just in their businesses. Business Solutions’ latest survey further corroborates this finding.
And, what are the three signs a VAR or MSP business owner is working on the business? Here are the big three:
1. They fully use a PSA (professional service automation) tool. If you use one you can expect to outperform your competitors relying on sticky notes and emails by 400%, according to Business Solutions‘ survey. For some IT solution providers, the difference is even more dramatic. Case in point is Matthew Adkins, president of VanGuard Technologies, who I spoke with last year. Adkins was only a couple of months away from shutting down his company when he attended a training session that challenged him to fully use his PSA. He did and now he’s enjoying year-over-year double-digit growth. Check out An MSP’s U-turn from Failure to Double-Digit Profits to read his story.
2. They participate in peer groups. Some of the best advice you can get is from other business owners that do what you do and can offer much more accurate advice that other types of business owners you encounter at a chamber of commerce meeting can offer. Business Solutions‘ IT solution provider readers that participate in peer groups earn twice as much as those who don’t.
3. They measure every KPI they can. This one can actually be broken down into three subcategories: a. Those that don’t measure KPIs, b. Those that measure a few major KPIs (e.g. profits, expenses) and c. Those that measure every KPI they can. The more you measure the more you earn, the survey revealed. Those that measure everything out earn those that only measure major KPIs by 2.5x and they outperform those who don’t measure any KPIs by more than 6x. One of the best examples I can think of who illustrates this point is Michael Kraner, CEO of managed services provider Primary Support and co-founder and director of MSP consulting firm MSP CFO. Once Kraner found the right help and was able to extract the real-time KPIs from his PSA, he was then able to make a turnaround in his business that was so profound that it led to launching another company dedicated to helping other MSPs do the same. You can learn more about Kraner’s success story by reading “A Successful MSP Launches a New Business by Focusing on the Numbers.“