Balance, Managed Services, and My Systems Model
I mentioned in my last post, Business Computer Systems Guide – Part 1, that VARs are an odd lot. Some VARs purchase the latest “how to be a computer business” course and enter the business with cookie-cutter marketing programs. However, most VARs are well established business people that sell specific software solutions or systems solutions in a carefully crafted vertical market.
The computer systems business attracts poorly capitalized, contractor dependent individuals that acquire business skills from computer systems business consultants of online “how-to” fame. Consultants like Robin Robins and Joshua Feinberg are legendary in the business. Their material, although compelling, can be a loaded canon in the hands of inexperienced business people.
These systems VARs are dependent upon selling service contracts and emergency repair services. They are not interested it business systems structure or best practices. The marketing consultants push reoccurring revenue over everything else. They also push immediate profits from canned solutions like Microsoft Small Business Server. Mention balance between systems deliverables and business need and they will not know what you are talking about.
Hidden among the flashy, out front systems VARs, are the vertically focused solutions providers that provide excellent service to their chosen market. These hard working business people provide software for such niche markets as resale and pawn shops, concrete pumping services, medical doctor’s practices and automobile dealerships. They are generally customer focused and quick to respond to market changes. They steadily provide a flow of customer support and product upgrades. It is not uncommon for their customer service people to fly to customers all over the world.
Niche market VARs push solutions over technology, problem solving over the latest big computer name in the business section. All the while, their solutions evolve, developed to the latest technology. Their benchmark becomes speed, agility, effectiveness and the size of their installed customer base.
Procede Software of San Diego, California provides a great example of a focused niche market VAR. They serve the automobile and heavy truck dealership market primarily in North America. The Procede Software Excede application, if deployed correctly, can serve every aspect of a dealership’s business without adding any other software product into the mix. This single benefit can add substantial cost savings to a dealership’s financial statement.
A typical systems provider VAR does not have an in house developed solution that they derive profit from. A typical systems provider VAR depends on their “channel” reseller relationships to survive. Margins are made on the hardware and software that they promote and sell. The “channel” refers to the sales path that occurs from the big software or hardware company, to the systems VAR, then to the end user. The end user (your company) pays for software licensing and hardware, as well as reoccurring software and hardware support.
The systems VAR’s intense focus on the reoccurring revenue model places it in direct conflict with business thinking. Businesses strive to eliminate reoccurring costs. Consequently, in recent years, a brilliant marketing tool has surfaced. It is called “Managed Services”.
The “Managed Services” hype promises trouble free computing and round the clock support. However, the words “Managed Services” are simply not enough for your business.
Your business may have been around for a while or you might have just started up. Your computers and printers may have been networked for some time. You might even have 40 or 50 desktops and a couple of servers, or you might have just purchased new equipment and used this guide to formulate a systems plan, then deployed your systems plan yourself. Regardless where you are in your business, you face similar systems challenges.
By now, you are certainly receiving mountains of “Managed Services” literature and scads of email urging you to sign up for the latest service plan. Whatever your computer, printer, server, network, systems situation, it is time to take the next step.
Forget about “Managed Services” and think CUSTOMER SERVICE.
“Managed Services” is a contrived term that moves the focus AWAY from what computer people are “doing for their customers” to how computer people are supposed to be “doing computer service business”. In other words, away from customer service to internal business processes. “Managed Services” is all about reoccurring revenue for computer service companies, insurance against tough times.
Without a profound focus on CUSTOMER SERVICE, there are no bones to MANAGED SERVICES. If the “network is having problems” again or the “Website won’t come up” or “my pc is slow” again, you are having customer service problems with your computer systems VAR.
You own your business and you control your destiny. You are pro-active about your sales, operations and employees. If the proposed managed services fill your need, are delivered robustly and exceed your expectations, then you have services that are CUSTOMER SERVICE intense and as pro-active about systems as you have become about your business.
My systems model combines the best of pro active systems monitoring and management, with “channel” relationships and focused niche market VAR solutions to set the stage for a robust cost effective business computing environment balanced with business need. My model requires a business to address several points:
Embrace a solutions provider, a niche market VAR dedicated to your niche market.
Focus on doing all of your business within the feature set offered by your chosen solutions provider.
Provide a top tier robust hardware environment for your employees and your solutions provider.
Support relationships between your knowledge workers and your solutions provider.
Leverage channel opportunities and big computer company opportunities.
Do you want your business to flourish? If so, balance the specific features offered by your solutions provider and the sophistication of your systems environment with the specific business needs of your organization; and, do it with a road map!
Thanks for reading. In the next post, I will discuss planning and design.