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How MSPs can capitalize on the surge in demand

In June 2022, ConnectBase founder and CEO Ben Edmond joined CloudSense’s Vice President of Industry Solutions, Vish Kumar and Vice President of Sales, Craig Stansberry, for a virtual roundtable to discuss how businesses can capitalize on the prodigious growth in demand for Managed Services.   

Gartner valued Managed Services at US$242.9 billion in 2021, and it is expected to balloon further to approximately US$354.8 billion by 2026. Businesses, both large and small, are having to rapidly adopt new technologies, cloud services and communications channels in order to keep up with their competition. 

We discussed the big questions and challenges facing managed service providers. What follows is an abridged transcript of their conversation:


Craig Stansberry, CloudSense: What we're going to be getting into today is the rapid growth in the Managed Services market, and even beyond the MSP market, covering all service providers.

In the face of rapid growth, service providers are having to deal with a continually evolving portfolio of services to accommodate their customers’ needs. With that as the backdrop, we want to delve into the challenges that MSPs are experiencing to meet that demand and capture market share. Specific to those challenges:

  • What solutions are businesses finding out there that are helping them scale? 
  • Are there certain operational challenges or scalability challenges where you don't feel like there's good solutions on the market for?
  • What are some of the solutions ConnectBase is providing, and what are the gaps you are filling?

Ben Edmond, ConnectBase: Connectbase builds solutions for the Managed Service Provider community, as more of the world shifts to the cloud and core revenue services are dependent on that network connectivity to perform, deliver security, and deliver the customer experience. 

Ultimately you can look at connectivity as the plumbing of the digital economy: how we live, how we play, how we learn, how we work, is sitting somewhere that people are not, and connectivity becomes the fabric to deliver that experience. 

Whether that experience means lower latency, more security or lower cost, it is more important than ever to navigate that rubric of choices around the last mile to get it connected into the data, applications, and ultimate computer that powers what is in the cloud.


Vish Kumar, CloudSense: With cloud comes myriad applications and technologies; what are you seeing in the market now with the products that you are selling?

BE: We see a lot of core fundamental shifts, e.g. UCaaS being embedded into just about every decision from a business standpoint. The movement to the cloud means not just one cloud: service providers are orchestrating any multi-cloud environment, and that is becoming the reality where Azure, AWS, Oracle, Google etc are all competing, but also enabling different workloads and different applications. 

They are also incorporating the SaaS applications that sit on top of those platforms - the Salesforces of the world - all key parts of the productivity drivers that have to get connectivity to deliver the right experience for those applications.

We're seeing a fundamental shift in how network is orchestrated. MPLS has been the dominant technology for the global WAN for a long time. SD-WAN is taking the market by storm and eroding IPVPN and MPLS traditional stack revenue, and this whole move to integrated security with the network with SASE is not just a fad, but a core driver of activity out there.


VK: What are some of the things that you're starting to see the customers face, e.g. where do they buy this stuff from, is it becoming more complex for them, and what are some of the challenges you are seeing in your experiences now?

BE: One of the interesting points of view we've seen around connectivity is that pre-COVID, you used to see MSPs manage their core 20 or so key relationships, and that was how they took connectivity to market and enabled their services. 

Now post-COVID, we're seeing that number shift to 100s or even 1,000s of different connectivity partners being orchestrated in (near) real time to give a competitive advantage and align to use cases that make sense for the commercial customer that they are trying to solve problems for.


VK: Extrapolating on that, when COVID hit we saw an almost tenfold increase in demand for connectivity globally. We saw application demand grow by 100% month on month - and in some cases week on week - just as businesses changed and transformed. 

What are the key things, in terms of how MSPs respond to that demand quickly? What were the challenges MSPs faced in terms of how to respond to customers, and maintain their original service level?

BE: It centers around three things: first we saw a shift to ‘purposefulness’ around connectivity, and embracing that purpose matters in the equation of unified communications, security and cloud revenue. 

Second factor is the nanosecond speed at which business is done today. It's a competitive disadvantage for those who have traditional processes that take days, weeks, or even months to orchestrate bids and proposals and satisfy customers' needs.

And lastly, it's getting into not just automating the basics, not just presenting workflow that gets superficial information, but really diving into the details that allow you to make decisions around customer experience, delivery times; the attribution that ends up making a lifetime value of a customer.


VK: How will MSPs respond to it now, and what do they need to be really conscious of to make sure their business is ready to expand like the market has been demanding over the last year and a bit?

BE: One of the themes of this cloud dominated future is that it requires business agility. It requires a mindset to have the data, the systems and the processes that are adaptable to changing needs of the market. 

These needs might be fed from changes coming from the business customer, the cloud infrastructure, the SaaS environment, or the network fabric itself. Either way, you need adaptability to that change in the processes, structure and software stack you use to power your business.

Secondly, whether you're talking about a UCaaS solution, the core, WAN connectivity, or the security framework, you want to have a mindset around how you deliver the end customer's end-to-end experience, both at home and in the office. There is a changing environment, and accommodating that and putting best practices in place to deliver your best customer experience is really important in today's competitive world.


VK: Let’s dig down into that a little bit more. Among the channels that service providers need to be cognizant of, we've always talked about self-service and self-enablement, but what is it now? What do service providers need to be aware of, and what environments and channels do they need to make sure they're successful?

BE: There are marketplaces being formed that are important destinations for their purposefulness. There is a customer expectation that they can get their information and make their decision whichever way they want. 

So service providers need to not just define their own ideal world, but accommodate their business customers' ideal world too. 

That means some brands that are strong in one area might have their own marketplaces, where you might not need to participate, while different products and services might be on another marketplace where you do need to participate. 

You might have partners that are go-to-market drivers who need their information and workflow in real time that you want to enable in your way, but those partners might have their own internal applications. So you have to think about the API framework, the integration stack and the enablement, in addition to the core workflow, data, and the engine that you orchestrate.


CS: Everybody has friction in their sales operation and is trying to improve efficiency. What is the greatest source of friction that you see in your sales operations, that slows you down and decreases your win rates?

BE: Sales friction is just a reality. It takes hard work and purposefulness to remove the friction, but the power in doing so is monumental. It's a key growth driver out there, and frankly, a differentiator as you get into the bidding process to win business. People that remove the frictions and elevate their internal teams or partners, end up having a higher propensity of closing.


Managed Services roundtable