The Face of Managed IT: How Dealers Differentiate Beyond the Tech Stack

Welcome to today’s trivia question. Here we go, gentle readers: what is the primary value proposition of the modern managed IT provider? Since I cannot hear you from where I sit, let’s workshop this subject and see if we can boil it down to a single talking point.

Is it a security component that comes as close to being 100% fail-safe as possible? Is cybersecurity an extension of this or the most important aspect? Well, we know 100% guarantees are a bit risky, and liability is a dark alley we fear to tread. This one comes close.

Is it oversight of a company’s network and servers? That’s quite often part of the conversation, but maybe not comprehensive enough to qualify. Ten years ago, a case could’ve been made that this was the main thrust. Throw in help desk and you have a strong case.

Should telephony fall under managed IT? It doesn’t have to, and for our purposes, it’s a hard no as far as being the cornerstone.

Cloud services, backup and disaster recovery, software patching, antivirus, cabling, etc.? Valued members of the roster, but not the face of IT.

Even if it’s none or all of these things combined, then what about the future of IT? How will AI tools, generative or otherwise, factor into the elimination or simplification of certain processes? Do we trust it at this point, and if not, then when?

Managed IT is less a service and more a state of being. It’s peace of mind. It’s protection for all the tech assets and data in your clients’ businesses. Most of your clients have little grounding in IT. They need you to ask all the right questions, like a doctor, to get to the heart of what’s required to protect them on any number of fronts. What this looks like is going to evolve, but the constant is they rely on you to keep them safe, up and operating. They don’t necessarily need to know how you do it, but they require the reassurance that you can deliver.

Our April State of the Industry focus includes a half-dozen examples of managed service providers (MSPs) and their journey to becoming that trusted IT partner. Look for the common denominators among them, and you’ll get to the heart of our original question.

Fully Focused

Dedicated is a term that applies to the value proposition offered by Vitis Technologies, the managed IT division of Cincinnati-based Prosource. The division bills itself as an outsourced IT department for everything from help desk support for end-users to strategy planning and budgeting with business owners. Dedication takes many forms, including a sales team geared exclusively to managed IT.

It’s really our team and our expertise that we’re selling to clients.

– Jeff Loeb, Vitis Technologies

According to President Jeff Loeb, the collective and constantly burgeoning expertise has accelerated Vitis Technologies’ growth while delivering solutions more effectively than the company’s competitors. “We invest heavily in our team, talent and expertise so we can meet customer needs,” he noted. “It’s really our team and our expertise that we’re selling to clients.”

Steve Sigmon, director of managed IT growth, points out that Vitis Technologies’ dedicated customer teams are adept relationship-builders, backed by a larger support team. One major point of differentiation, in his opinion, is the way Vitis has structured its growth team.

“We have business strategists with expertise in IT solutions, and we also bring in a solutions architect—really the IT backbone we need to get the solution across the finish line,” Sigmon remarked. “At the end of every proposal, we want to have positioned our team as the only choice.”

Vitis identifies the 20-100 employee range as optimal—large enough for a company to require dedicated IT management but not big enough to justify an internal division. The personalized approach is evidenced by the smaller, dedicated customer team that managed IT clients enjoy, which includes a solutions engineer, a strategic technical account manager, a customer success specialist and a systems analyst.

At the end of every proposal, we want to have positioned our team as the only choice.

– Steve Sigmon, Vitis Technologies

Clients requiring comprehensive services mesh with the businesses’ go-to-market strategy, but à la carte services are also available. Benny Russert, director of technology alignment for Vitis, notes the latter group is at the high end of the target profile where clients typically seek cybersecurity services and consulting.

“We’re very deliberate with project work,” Russert noted. “We typically don’t engage in project work for clients who aren’t managed services customers. And that’s for the benefit of our business and our clients. When we engage in project work without having our hands around the environment and truly understanding an organization’s short-term and long-term business goals, that’s typically going to result in a less-than-ideal outcome all around.”

The dealer’s assessment strategy centers on understanding how the client offers value to its clients, Russert added, and determining how Vitis can empower them. “Usually, that means talking about operational efficiencies, but it’s also a focus on keeping them in business, keeping them safe and keeping them secure,” he said.

When we engage in project work without having our hands around the environment and truly understanding an organization’s short-term and long-term business goals, that’s typically going to result in a less-than-ideal outcome all around.

– Benny Russert, Vitis Technologies

Goal Alignment

There are valuable components to a top-notch managed IT proposition, particularly those that speak to optimizing technology infrastructure, enhancing security and streamlining operations. Loffler Companies of St. Louis Park, Minnesota, can check all those boxes. But while help desk, network management, cloud services, cybersecurity, data backup and budgeting highlight the dealer’s tech stack components, the true value is delivered through consulting with clients to make sure the solution aligns with their business goals.

James Loffler, company president, notes how the ability to address the growing complexity of technology is a key growth driver. It doesn’t seem all that long ago when managed services conversations revolved around ticket response times, password resets and data backup planning.

“Conversations today involve cloud migrations, multi-cloud infrastructure, cybersecurity training and preparedness as well as an overall closer alignment with a customer’s business goals,” Loffler pointed out. “It’s difficult and expensive to have all that expertise in house.”

Making the shift to the cloud and digital transformation has also opened opportunities for Loffler Companies to guide clients through their migrations. Client integration demands can spur opportunities for MSPs that offer holistic solutions, Loffler added.

The dealer is one of the few that have embraced all three scaling models—building, buying and partnering. Strategic technology partners help complement the in-house offering with best-in-class solutions, and the dealer is always on the hunt for M&A opportunities in which partners can help evolve Loffler’s solutions.

Fit extends beyond just technology—it includes alignment with the strategy, consulting and partnership components we provide.

– James Loffler, Loffler Companies

Mid-sized businesses that value technology and its role in achieving business goals are the prime targets for Loffler Companies. Engagements with extremely small businesses are eschewed, while enterprise businesses with complex and rigid structures—not to mention a large in-house technology team—wouldn’t be able to realize the full value of Loffler’s IT offerings (the dealer has a team selling copy/print solutions to enterprise clients).

One of the differentiators for Loffler Companies is the extent and thoroughness of its IT assessments in order to better understand the depth of solution required to address the client’s goals. This yields insight into whether an engagement is in the best interests of both parties. Being able to provide a broader managed technology stack to clients is mutually beneficial.

“Our teams become so dedicated to the success of a customer once they’re onboarded that this mutual fit is incredibly important for us,” Loffler stressed. “Fit extends beyond just technology—it includes alignment with the strategy, consulting and partnership components we provide.”

The Newcomer

In the parlance of managed services, Kelly Office Solutions might be considered a newbie, having entered the field in 2015. Considering the significant uptick and evolution of the broader tech stack and various elements, not the least of which is cybersecurity, maybe the Winston-Salem, North Carolina, dealer is more of a grizzled veteran. Regardless, Blake Renegar—the director of managed network services—confesses it took a few years for the dealer to get fully acclimated.

“Managed IT has a similar recurring revenue model and billing structure as copiers, but the actual management and servicing of accounts is quite different,” he said. “There are a lot of areas that require proficiency to do a good job for your clients. There were a lot of things we needed to work on, particularly in the early stages, to get where we needed to be.”

Renegar had no interest in reinventing the wheel, thus his company partnered with Collabrance. He’d heard the horror stories about building from scratch—the upfront costs and the expensive quest for talent such as engineers. That doesn’t take into account the outlays required to assemble a help desk infrastructure. Acquiring the competency is equally problematic; Renegar points out many managed IT independents aren’t turnkey in nature, instead subsisting on hourly work. It’s hard to create an MSP culture in those circumstances, and the true managed IT providers, again, don’t come cheap.

There were a lot of things we needed to work on, particularly in the early stages, to get where we needed to be.

– Blake Renegar, Kelly Office Solutions

Kelly Office Solutions is the face of the managed service, with its partner behind the curtain. The beauty of Collaborance, according to Renegar, is that it covers back-end services such as help desk, server management, patching, antivirus and email management: essentially, the dealer’s network operations center in white-label fashion. As for his part, Renegar took a two-day sales training course and was ready to roll.

The full-package service model works well for the dealer, but it will do project work for select contracted clients. Renegar feels the optimal end-user headcount range is 10-100 employees, and he’s found that many clients on the copier side (small nonprofits, churches) are simply too small to reap the benefits of the full IT package.

“We’ve had the most success in technology-intensive verticals and businesses that acquire and hold sensitive customer information or financial data,” he noted. “Legal, health care, finance, manufacturing and service-based industries represent a lion’s share of clients.”

Stepford-esque Engineers

From basic monitoring and update patches on the light side to the more complex server migrations, support and troubleshooting, Edwards and Virginia Business Systems (EBS/VBS) believes it can speak to most immediate and long-term needs of clients. While monthly recurring revenue engagements are prized, the Bethlehem, Pennsylvania-based dealer can also address IT projects, backed by an experienced engineering team. Having a staff with homogeneous knowledge means that, regardless of the team member assigned the ticket, clients will enjoy the same level of support and professionalism, according to Dan Lamborn, corporate director of managed IT services. Maintaining thorough documentation for all clients goes a long way toward being able to provide first-call resolution.

EBS/VBS’ ideal client profile is the 20-50 client SMB. Cybersecurity, help desk, Microsoft 365 licenses, BDR, UCaaS and top-flight support comprise a significant majority of the platform, backed by the belief that the uniqueness of each client demands a tailored IT approach.

“Because of the vast differences between the various organizations we support, we do offer our services separately and independently,” Lamborn noted. “We don’t want to exclude the small organizations that cannot afford the all-in approach. We’ve found that offering our project work has provided us the opportunity to showcase our team and support. Project work has opened many doors and is a great approach to the client coming completely on board with our IT services.”

We’ve found that offering our project work has provided us the opportunity to showcase our team and support.

– Dan Lamborn, Edwards and Virginia Business Systems

Lamborn notes that cybersecurity remains an ongoing concern, particularly for clients whose only line of defense is antivirus software. With businesses increasingly leaning on technology and given the growing complexity of IT environments, client needs mostly revolve around securing networks, cloud migration and optimization of digital operations.

“Certain traditional IT services, such as on-premises infrastructure management, have seen a decline in demand as more organizations transition to cloud-based solutions,” he added.

Client Reassurance

Confidence and comfort are the twin fortes that resonate most with clients and can go a long way toward determining the fortunes of any service provider, particularly managed IT. Erik Crane, president and CEO of CPI Technologies in Springfield, Missouri, believes a main point of differentiation is the firm’s in-house help desk. Having a local/regional feel, he notes, provides that level of comfort.

CPI offers clients the full IT monty—MNS, low-voltage cabling, VoIP and cybersecurity, to name a few—and has generated growth within its own base. A number of net-new engagements has been a gateway to proliferating the dealer’s more traditional offerings. Partnering with ConnectWise allows CPI to control its growth and not tax resources. Crane believes the client range of two to 300 endpoints is the sweet spot for opportunities.

End-users have the option of going with a managed or co-managed solution. “We’ll work to eventually be the sole provider, but understand that trust is earned, not given,” Crane remarked. “We’ll work with clients and prospects to meet all their needs from beginning to end. Our sales team works closely with the technical side to provide a comprehensive solution tailored to meet the specific needs of each client. CPI ensures that our technology stack excels in security, ease of use and reliability. This allows us to reduce future vulnerabilities and complications. CPI advocates for a holistic approach to IT solutions to ensure optimal performance and security.”

We’ll work to eventually be the sole provider, but understand that trust is earned, not given.

– Erik Crane, CPI Technologies

One of the most popular talking points is AI, with clients inquiring as to how they can leverage it in their everyday business. CPI’s ability to speak authoritatively on the topic is yet another trigger for confidence and comfort. But while AI is today’s hot conversation, network and cybersecurity remain dominant pain points.

“The uncertainty around such vulnerability will keep clients up at night,” Crane added. “Being the expert for your clients by providing the best protections is key to maintaining that relationship.”

Gradual Build

It’s no state secret that the road to scaling in managed IT is a long one, and the ability to turn a decent profit can be even more challenging. That’s what makes it so important for a fledgling MSP to have an outside support system. This has been the case for Woodland Hills, California-based GoodSuite, which sought to craft an in-house competency backed by support from ConnectWise and the Technology Advisory Group (TAG). The 2022 acquisition of Strata IT helped accelerate GoodSuite’s journey, but CEO Dan Strull knows his offering is still a work in progress.

“We have a staff of 10, and we partner with ConnectWise and TAG, among others, to make sure we have the support we need daily,” he said. “We started from nothing and slowly built it up, but the (Strata) acquisition spurred our growth. We focus our tech stack on simplicity and stick to the SMB market without any particular vertical focus.”

GoodSuite emphasizes comprehensive managed service agreements, with project work relegated to longtime clients. Cybersecurity is the number-one pain point, according to Strull, although all offerings that fall under their IT umbrella (including disaster recovery, end-user security awareness, cloud migration, help desk and on-site services) have witnessed an uptick.

We started from nothing and slowly built it up, but the (Strata) acquisition spurred our growth.

– Dan Strull, GoodSuite

“We bring on clients that prioritize technology, act professionally and partner with us to provide a tech roadmap that allows them to be most successful,” he added.