N-able Global Partner Summit 2013 Get Out of Your Trench… It’s Killing Your Business!

1. N-able Global Partner Summit 2013Get Out of Your Trench…It’s Killing Your Business! David Wilkeson, CEO dave@mspadvisor.net 330-286-9070 www.mspadvisor.net www.linkedin.com/in/davewilkeson/

2. About David Wilkeson • Serial technology entrepreneur • COO and Partner in DRS from 2005 – 2013 • Went from a 9 person break-fix shop in Youngstown, OH to an 85 person MSP and Cloud Provider with offices throughout Northern Ohio and Western PA • Participated in many industry groups – VTN, True Profit Groups, TruMethods, Service Leadership • Technical and sales background • Formed MSP Advisor, an MSP consultancy

3. The View From The Trenches • Most owners spend too much time in the trenches • The trenches are comfortable…unless they are on fire • It’s dark in the trenches – you don’t have a good view of your business

4. Two Kinds of Owners Sales Background Technical Background

5. Signs You’re in the Technical Owners Trench • You believe the project/engagement isn't worth doing if it isn't technically sound (by your standards) • You believe quality sells itself • You believe cost is secondary to design • You believe every customer is different, therefore every design has to be different  • Your new hires are predominately high end engineers • You are too light on true Management(after all, managers are one of the reasons you went out on your own!) • This works in a project-driven VAR organization • In an MSP, it impedes your growth

6. Signs You’re in the Sales Owners Trench • You believe you can sell your way to prosperity • You believe revenue is king (vs. profit, costs, etc) • You believe all deals are good deals if the customer is willing to pay a certain $$ amount • You believe you are just one sale or $X away from solving all your problems • This works in VAR, Pro Services or Cloud sales • In an MSP, it impedes your growth

7. Problems with Sales Focus • Revenue is not the ultimate KPI • Neither is Labor Loaded Gross Margin (LLGM) • Employees become overwhelmed by volume • Typically overpromise and under deliver • Constant fires • Forces everyone into a very reactive mode • Owners priority is to make more sales to fix the above problems • Owner is so “100,000 foot view” that they can't see the root causes of problems

8. Problems with Technical Focus • Typically low profit and low growth • Consistent cash flow issues • No sales pipeline insight, sales are not predictable • Unwise spending/over spending on infrastructure and tools • Labor numbers too high, LLGM is too low • Lots of chiefs, not many Indians – or no chief at all • Owner is so down in weeds that they can't see the root causes of problems

9. Balance is the Key to Success! Sales Technical

10. Balance is the Key to Success! Technical Sales Technical Sales

11. How to Bring Balance The Three P’s of Balance • Planning • Processes • Performance Indicators (KPIs) = Predictability!! Sales Technical

12. Planning • Identify (or hire or partner with) the Yin to your Yang • Commit to regularly leaving your trench • Implementation of processes is a process! • Set goals and deadlines in writing Sales Technical

13. Sales Processes Managed Services is a Product • It includes specific services and features • The tools like N-able are features of your product, not the actual product • Products are predictable • Describe your products in writing Sales

14. Sales Processes Establish a Predictable Sales Process • Sales pipeline tracking process • Deal close rate tracking • Activities to keep pipeline full • Simply answering the phone is not a predictable sales process Sales

15. Technical Processes Establish an Onboarding Process • Who, what, where, when • Standard documentation is key • Establish a standard project plan for onboarding and stick to it • Determine how many you can onboard per month Technical

16. Technical Processes Establish a Standardization Process • Goal should be 90% similarity between customers • Customers expect “Best Practices” from MSP’s • Standardization should be part of all upgrade projects • Standardization improves support Technical

17. Technical Processes Establish an Automation Process • Automate everything possible • Identifying automation targets is key • Automation decreases labor costs and improves support • Automation improves customer satisfaction Technical

18. Technical Processes Establish a Detailed Ticket Handling Process • Must focus on SLA adherence and predictability • Establish role based steps rather than employee based steps • Use ITIL “lite” as a basis • Consider a triage process Technical

19. Technical Processes Establish a Process Improvement Process • Processes must change as your business grows • There’s always a better way! • Regular formal meetings work well Technical

20. Process Improvement Meeting

21. Technical KPI’s Service Level Agreement (SLA) Adherence • Must be measurable in real-time and readily viewable • Must be clear contractually • Should be the same across the board for the same product Technical

22. Technical KPI’s Mean Time to Resolution (MTTR) • Should be broken down by ticket severity and product • Trends are more important than the number (if the number is within reason) • Should not be used as an SLA measurement in Outsourced IT type Managed Services Technical

23. Technical KPI’s Open Ticket Count • Should be broken down by ticket severity and product • Week to week trends are more important than the number • The trend is a good measure of the health of a support group Technical

24. Technical KPI’s Opened/Closed Ticket Ratio • Important number to know on a daily basis • Critical number to know on a rolling weekly basis • Consistent weekly ratio >1 is bad news Technical

25. Technical KPI’s in Action

26. Sales KPI’s Sales Pipeline $$ • Target amount varies by company • Forecast value of deals in process, adjusted for sales phase and close rate • Good sales forecasting drives managed growth Sales

27. Sales KPI’s Deal Close Rate • Varies by company, sales technique, and target market • Tracking close rates allows you to analyze your sales process • The more predictable your close rate, the tighter your sales process is Sales

28. Sales KPI’s Customer Retention Rate • Important to know what contracts are in jeopardy and why • This needs to be factored into your sales pipeline and forecasts Sales

29. Sales KPI’s Labor Loaded Gross Margin (LLGM) • MSP Revenue – Costs associated with MSP (tools, licenses, travel, etc) – MSP Labor Costs / MSP Revenue • Goal is > 70% • Ex: $150k MRR - $5k in costs - $40k in labor / $150k = 70% • Goal is only attainable through tight processes and correct pricing Sales

30. Sales KPI’s Effective Hourly Rate (EHR) • Customer Contract Revenue / Contract Hours Used • Goal is > $125 • Ex: $5k MRR / 40 hours = $125 EHR • Individual customer EHR is a good indicator of the health of that customer • Bad average indicates bad customer fits, pricing too low, or bad processes Sales

31. The Ultimate KPI Predictable and Stable Bottom Line Profit Sales Technical

32. Questions? David Wilkeson dave@mspadvisor.net 330-286-9070 www.mspadvisor.net www.linkedin.com/in/davewilkeson/