A new, non-traditional research study seeks to change the integration industry’s dialogue around service revenue.
The transition from product- and project-based revenue toward a recurring revenue and service-oriented model is an omnipresent topic in integration industry trade publications, webinars, and business conferences.
The traditional focus is on making a case for integration companies to shift business models and pursue the more consistent cash flow and stickier customer relationships that come with a service business.
However, “Anatomy of a Successful MSP” by NSCA, the leading not-for-profit association representing the commercial integration industry, and PSA, the world’s largest consortium of professional systems integrators, reframes the topic by analyzing only managed service providers (MSPs) that are successful. The research isn’t designed to make a case for why integration companies should target service businesses; instead, it unveils a blueprint for MSP success that other integration companies can follow.
The research, based on a survey of integration companies with demonstrated success in growing their service business, identifies common trends:
- Steps taken by successful MSPs after committing to a service-oriented business model
- Types of third-party providers they leveraged to get service business off the ground
- Financial investments involved with committing to and launching service programs
- Employee investments
- The financial impact on companies
“Many integration companies understand the value in shifting to a more service-oriented revenue model, but they’re still slow to make the transition,” says NSCA Executive Director Tom LeBlanc. “It’s a big change. Companies want to proceed carefully and strategically. This can be difficult because, in the integration market, there are so few blueprints of successful service providers to follow.”
The research by NSCA and PSA provides integration companies with more clarity into necessary steps and the pain points involved with restructuring a traditional business model.
“It’s a non-traditional research piece based on a small but focused survey,” says Candice Aragon, vice president of marketing & events for PSA and USAV. “Both NSCA and PSA identified lists of relatively successful service providers and asked them to share perspectives that might help integration companies that aren’t as far along in their transition to managed services success.”