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Joe at MSPMentor wrote a great post on starting a business with a partner.   For those of you who don’t know me, I’m an entrepreneurship nut, not an IT nut.  I LOVE getting my hands on anything to do with business, and I studied entrepreneurship for my MBA at Babson College, which is consistently considered the top school on entrepreneurship.  I don’t say this to boast, just to give some background and to let you know that this is my favorite subject.

I’m also a huge believer in continuing education, so I’m always putting a new book or website in front of my employees’ faces and hoping they’ll get just as excited about learning as I am.

So…that being said, I couldn’t pass up on this opportunity to point out my favorite resources on entrepreneurship.  I’ve already mentioned most elsewhere on this site, but they are worth repeating!  I get contaced by a lot of managed service providers that are just getting started; I hope this list will be helpful for you in particular.

1. E-myth - for learning how to put processes into your business and work on your business.
2. Gazelles - for executive development and general ideas about growth.  Sign up for his newsletter, it’s a must read!
3. Great Game of Business - to learn how to use open book management to engage your employees and grow your business.
4. EO Network - a global network of entrepreneurs with businesses doing over $1m in sales per year.  Worth every penny to join.
5. The Kauffman Foundation - perhaps the best think tank on entrepreneurship.
6. Babson College - I can’t leave that one out!  Rated #1 entrepreneurship program 13 years running.  They have some great executive development programs you can attend if you don’t want to take the time off for a full degree.

I’m sure I left out some good ones - what do you have on your list?

MRC

I just read the recent announcement from N-Able stating that they are giving free access to their entry-level product to Microsoft partners as a way to further speed the adoption of managed services in the marketplace.

It begs the question: can anyone become a competitive managed service provider? Are their any barriers to entry in this business?

My answer: Yes and No.

Yes, practically anyone can become and MSP within a week if they so desire. The tools are all available, and they are all getting cheap or free. So technically, anyone can become a managed service provider quickly and at almost no expense.

But No, not everyone can be competitive in this space just because they have access to all of the same tools as everyone else. Why is that? I’ve said it many times before; it takes building a service culture that has fully accepted managed services as its business model to build a viable MSP business.

The tools are important, don’t get me wrong. But they are really just your ticket to get into the amusement park, then all of the fun happens! It takes much more than software to build a business - at least in this space.

So what does this mean for the marketplace? I think what N-Able is doing is good news. It will help get all of the businesses out there familiar with the concepts of managed services. However, the market will be over-crowded with a lot of small players that aren’t delivering that great of service. That means noise and confusion for prospects.

But eventually most of the small players will go away - the bad ones going out of business, and the good ones joining the ranks of a larger company or growing into one themselves. That will be good for everyone.

MRC

Found this update in my inbox this morning from Michael Menegay from Dell – I was not sure who he was until I read his signature but I guess he feels I am his partner by the looks of it.

Dell is pushing Everdream direct to customers and offering us MSP certification. At first glance this looks like cause for alarm until you realize it is Dell and they will never get the personal touch our service requires right with small businesses.

In the last month dell has visited two of my clients unsupervised and both ended up with sever business interruption and are in the process of trying to get money out of dell. Why do I tell you this? Because I feel it will be the same with Dell’s direct managed services. Not to say they are not a smart organization, they are just too big to give Joe’s local consulting business the personal attention they need.

In my opinion (take it or leave it) I feel Dell’s, and all the other giants, push into the market will do nothing but educate clients sending them looking for you and me – the quality high touch sub fifty million dollar organizations providing managed services with a personal touch.

Check out the letter and I will see you at the webinar the week of the 21^st.

JC

Dear Partner,

At the Dell/SilverBack Managed Services Partner Conference held in January, we committed to open and continuous dialogue with our partner community on Dell’s managed services strategy, program enhancements and go-to-market initiatives.

MSP Certification Update

Today, we are pleased to announce some updates. The Dell MSP certification program has been enhanced to include Dell’s end-user device management services (enabled by the recently acquired Everdream technology). This technology is exciting as it permits our partners to offer new and expanded product sets consisting of software distribution, patch management, remote asset discovery, asset management, data encryption, online backup, software licensing and remote administration to your vast base of desktop and notebook systems.

To support these new capabilities for our partners, Dell has added an MSP certification track for Dell’s end-user device management services. Our partners can now access the technology, training and best practices of all managed services practice areas, including those offered for IT infrastructure remote monitoring and management technology driven by Dell’s enterprise monitoring services (enabled by the recently acquired SilverBack technology), and those offered for Dell’s end-user device management services.

Dell’s end-user device management services technology represents an exciting addition to our MSP certification program. Current Everdream partners who register before May 15, 2008 will be “grandfathered” into the Dell MSP desktop remote management certification program. Also, we are thrilled with the results of our first Dell MSP Partner Certification program based on Dell’s enterprise monitoring services, as new partner certifications have increased over four hundred (400%) percent in just four (4) months. We look forward to similar results with the expansion of the program utilizing the Dell’s end-user device management services platform technology.

Managed Services Update

As we discussed at the January MSP partner conference, Dell will be starting a limited pilot in Dallas, TX selling small businesses basic remote monitoring and remediation services using Dell’s enterprise monitoring services. Dell will look to expand this pilot over the course of 2008 in the Americas, Europe and Asia Pacific regions as feedback dictates.

As promised, we will update you on the progress of this pilot as results and feedback are generated. We’ll continue to communicate and work with partners to further develop the channel offering that will compliment Dell’s small-business managed service offering. There will also be opportunities for partners to participate in the pilot, and we will provide details in the coming months.

And in closing, during the week of April 21, 2008 we will host a managed services partner webinar that will further outline the results and growth of our MSP certification program, and share our plans for continued enhancements to the MSP platform and overall channel program. This webinar will provide our partners the opportunity to be educated on the enhancements to Dell’s platform technology and programs that will enable you to develop specific initiatives suited to meeting your business goals.

We envision this webinar being the first in a series of conversations with our partners as we continue to develop Dell’s Managed Services channel strategy and offerings for our partners.
We will be in touch with you shortly with details about our upcoming webinars.

As always, we look forward to your feedback.

Sincerely,

Greg Davis
Vice President and General Manager
Americas Channel Group

Michael Menegay
Global Director, Dell Managed Services

Process #1 = People process

How do you know you are hiring the right people? I was speaking with the CEO of a managed service provider not long ago and he told me that they had just hired “a great guy”, “this guy knows everything about servers” he said. I responded “that’s great how does he fit in culturally?” He seemed surprised by my unwillingness to talk about the technology strengths of this individual as I focused on his cultural fit. His response was along the lines of “I don’t know I don’t really participate in our hiring.”

In my mind this is one of the biggest mistakes managed service providers can make. Creating a service culture and successfully delivering value to your clients depends directly on the people you hire – now I know this is an obvious statement but you would be surprised how many smart people will yes you on this and then go out and hire the “smart tech guy” that just doesn’t mesh with what their organization is about.

Everon’s people process

1^st we spend a good deal of time defining what our culture is and what core values are important to the organization. We are very clear that we are first and foremost a customer service organization, we just happen to be really good with this technology stuff.

We have created a culture to empower our people by giving them simple decision making guidelines for every situation:

Is the decision the right thing for the customers business?

Is it the right thing for Everon?

Will you be willing to stand by your decision if asked?

If you can answer yes to all three of these questions we will always be behind your decisions.

2^nd we educate our leaders to always hire for cultural fit first

We look for hires with great people / service skills as we truly believe we can teach the technology stuff. Have you ever tried to do it the other way around, total disaster!

3^rd we value critical thinking skills above knowing everything

Don’t get me wrong we have some people that think they know everything but in reality no one can be smarter than the team and no one knows everything. If you can work from a base of knowledge to find your way through a problem (technical or people problem) that you have never been exposed to before then you will be successful in this business.

It is important to create a repeatable hiring process that allows you to get at the heart of the things important to your culture. Design questions, scenarios, puzzles, and situations that give you the answers to hire the right people. Spend as much time and energy as it takes to educate your leaders and get them bought into the system and reap the benefits of cultural alignment.

JC

At first this may seem like an obvious thing but you would be surprised how many people I speak with that have no documented repeatable service processes. There are a lot of good MSPs out there getting by with a few account managers or business developer / relationship people. The problem is when you ask them what their systems are to ensure that each client that comes through the door experiences great service they do not have an answer. All too often it is left up to the relationship person in the company to decide what they do for a client and when – this is not a recipe for success.

If you assume all your people are doing just fine with no process or solution delivery roadmap to follow you are going to severely limit your ability to retain clients, your ability to develop more people into these critical rolls, and ultimately your ability to grow your organization.

At Everon we focus on teaching our people a systematic way to build relationships, gain the trust and respect of the business owners we work with, and ultimately establish themselves and Everon as a thought leader in the small business technology world.

Yes your people can all be left to their own devices to figure these things out but wouldn’t it be better to know that there was a systematic process everyone was following to ensure their success?

I don’t know about you but I sleep better at night knowing that we have processes in place.

Josh

Every IT provider deals with it, MSP or not, and most do not have margins healthy enough to sustain the overhead it takes to do it well – purchasing for clients.

Who wants to deal with inventory, licensing, supply chain programs, thin margins, being tied into a specific product line, the list goes on…

In steps PaaS providers. It’s a niche being filled by a handful of firms focused specifically on providing all the back office process, people, and relationships necessary to provide your clients with the purchasing expertise they demand.

Some of the benefits to your business:

• Adding healthy margin to something you are already doing for your client
• No need to spend time trying to establish the right supply relationships
  
• Leveraging the combined purchasing power of multiple organizations – discounts and service beyond what you can get on our own
  
• Add purchasing expertise to your team without increasing head count – head count is huge for us MSPs providing a flat fee model
  
• Gain access to state of the art purchasing systems – tracking, inventory, etc.
  
• One place to go for all things purchased – no more tracking from multiple vendors for every project
• Increased service levels, HUGE, over the dell or (inserter large vendor name here) rep that manages your account – did I mention these relationship guys tend to change on you every 8 months with the large vendors
  
• Add a trusted resource to your team that understand your business, your clients business, and helps you build recurring revenue programs that benefit you and your clients

With benefits like this and the ability to bolt a partner on to your business to provide these services who in their right mind would invest the capital necessary to build a ‘purchasing department’?

One of the best PaaS partners we have found in the country is Axis Business Solutions and you can check them out here: http://www.axisbusiness.com/vendors.htm

As it becomes more and more important for MSPs to invest their time and energy into their core providers such as these will play a large role in allowing us to do so.

JC

I can tell you first hand from growing a managed services business that it takes a lot more than just buying Dell server monitoring and offering it to you customers to reach the $10 million mark.

I am not sure if Dell has even taken the time to evaluate the claims they are making on the Silverback homepage: http://www.silverbacktech.com

No offense but generally one man shops are one man shops because they have technology focus rather than a business focus. Getting a one man shop to sell recurring revenue products is a challenge by itself never mind convincing them to put the business process and people in place to reach the $10 million mark!

I think this is just another example of Dell not having a sniff how to approach our market. Not more than a few weeks ago they announced they are going to sell the Silverback product direct to small businesses and in the same breath they are asking you and I to get in bed with them as a partner.

If you get in bed with Dell you are getting in bed with your competition, albeit they don’t know what they are doing buy why partner with Dell when they will be directly selling against you?

Think about it.

JC

It is more and more critical everyday to provide a high level of customer service along with technical support to small businesses. Increasingly your people will need to be service / business people rather than technicians to in order to survive working with Small businesses.

Over the years we have consistently hired for cultural fit (service orientation) as well as people skills above technical skills and it has paid dividends in the form of client retention.

I truly believe that technical skills are the easiest piece of the three to teach someone.

We say it frequently, we are first and foremost a service business, we just happen to be phenomenally good with this technology stuff! This is an attitude that MSPs need to embrace in their organizations if they hope to survive.

JC

Is it just me or am I talking about Dell a lot lately? I have to tell you that there is more activity in our space than ever before and Dell just so happens to be publicly out there scooping up solutions like hot cakes at present moment. There is not a major player out there right now not thinking about how to get into the managed services game. Trust me, I have had the opportunity to speak with many of them and they are all scratching their heads trying to figure it out.This is the email that went out to MessageOne clients earlier today, let’s see what Dell does to their service going forward, it should be interesting.

Correct me if I am wrong but wasn’t MessageOne founded by Michael Dell’s brother? That must have been an interesting dinner conversation…..

JC

———————————————

Earlier today, MessageOne announced that we have agreed to be acquired by Dell Inc. While the acquisition is subject to the customary closing conditions and approvals, we’re excited that this represents a significant new chapter in MessageOne’s continued growth.

When we founded the company almost a decade ago, our mission was to assist customers in managing risks related to enterprise messaging – business continuity, compliance, and disaster recovery. While the company has grown dramatically, our core value proposition has never changed – the commitment to making sure every MessageOne customer looks like a hero in assisting their organization work through a major event or disruption.

The planned acquisition by Dell, one of the largest and most respected IT companies on the planet, will enable us to bring the solutions we have created to a much broader audience. We’re also excited to have the resources of Dell behind us, further energizing our innovation in areas that matter most to our customers.

Last October, Dell launched a new initiative to “Simplify IT”. Dell believes that MessageOne’s uniquely channel-friendly SaaS (“Software-as-a-service”) solutions are a perfect example of services that can further help eliminate complexity, cost, and risk from the management of Information Technology.

While today’s news represents a major acceleration in MessageOne’s evolution as a business, we are proceeding in “business as usual” mode in our daily work. In particular, we remain committed to the high quality of service and support we provide you, our customers. Moreover, as an important byproduct of the strong strategic fit between the MessageOne vision and Dell mission to “Simplify IT”, Dell has assured us of their commitment to a continued, world-class customer experience.

We anticipate a follow-up similar to this note as the planned transaction achieves closure. In the meantime, please do not hesitate to contact us if there are questions on your end. Also, please take a moment to read through the Frequently Asked Questions below.

Sincerely,
Satin Mirchandani

——————–

Satin Mirchandani
President and CEO
satin_mirchandani@messageone.com
http://www.messageone.com

MessageOne
11044 Research Blvd
Building C, Fifth Floor
Austin, TX 78759
(512) 652-4500

---

FAQ

1. What are Dell and MessageOne announcing today?

We are announcing that MessageOne has signed a definitive agreement to be acquired by Dell, subject to customary closing conditions and approvals.

2. Why does Dell intend to acquire MessageOne?

Last October, Dell went on record saying that information technology is too complex and that in response they were launching a new initiative to Simplify IT. Dell believes that MessageOne’s products are a perfect example of services that can eliminate complexity, cost, and risk from the management of Information Technology. In particular, this acquisition will help Dell Simplify IT for messaging management for customers by improving email availability, ensuring business continuity, enabling e-discovery and compliance, and reducing risk.

3. Why did MessageOne decide to sell the company?

We view this planned transaction as simply the next step in our evolution as a company, and a significant expansion in our ability to address the vast, fast-growing available market – particularly in geographies outside our North American home market. By joining together with Dell, one of the largest and most respected IT companies, the MessageOne team is excited to be able to bring the solutions we have created to a much broader global audience. We’re also excited to have the resources of Dell behind us, allowing the company to further innovate on features and services that matter most to our customers.

4. What does MessageOne do?

MessageOne provides software as a service-enabled (SaaS) services for e-mail continuity, archiving, compliance and disaster recovery to more than one million users around the world. Global companies trust MessageOne’s solutions to prevent email downtime, ensure business continuity, archive email, eliminate messaging risk, and streamline compliance and discovery.

5. How will customers benefit from this acquisition?

With Dell’s resources and global reach, MessageOne will be able to invest more than ever in both product innovation and customer service on a worldwide basis. For existing MessageOne customers, Dell has committed to ensure continuity of service and a continued, world-class customer experience.

6. Will you accept new customer accounts?

Yes! Please contact us today at sales@messageone.com and/or +1 (512) 652-4500

7. I am a current customer of Dell, MessageOne, or one of MessageOne’s partners. Will I need to sign a new contract for services after the acquisition closes?

No, we anticipate that any sales contracts executed with MessageOne prior to close of the planned transaction will remain in effect.

8. How does MessageOne sell its services now, and will these channels change after the acquisition?

MessageOne sells through a direct sales force and through a carefully selected group of world-class private label channel partners. After the completion of the acquisition, Dell looks forward to continuing to serve and build upon MessageOne’s significant portfolio of existing customers and channel partners. MessageOne products will continue to be available to end customers and through channel partners. MessageOne technologies will also be incorporated into future Dell service offerings after the acquisition.

9. Does Dell use MessageOne’s services today?

Yes! Consistent with the “Dell on Dell” vision, Dell currently uses MessageOne’s Email Management Services in its global IT organization.

Don’t expect them to make you successful!

I used to see this a lot early on in our industry - hourly IT consulting firms would go out and buy the network management/monitoring tools and be surprised when they didn’t instantly transform their business into a successful managed service provider.

The tools are important - you have to have them - but they are just a ticket into the game.  Building a successful managed services business is much more about people, processes, sales, and marketing than it is about technology and tools!

Don’t get me wrong - the tools have come a long way in the last few years.   Some of them are really good, and some of them are really focused on adding value to the MSP beyond just monitoring and basic maintenance routines.  I think choosing the right one can have a really big impact on  your business.

But they won’t do the heavy lifting for you!

What is the “heavying lifting” I’m referring to?

Finding customers.  Finding good people that love to deliver service as much as they love technology.  Building a culture.

So do your homework; get the right tools.  But then get to work building your business, because the tools won’t do it for you!

MRC