Massaker.Me

Instead of telling you what I think, I want to know what you all think. In a commodity type business, such as IT support, you look for any distinct advantage, any method of differentiation that you can to market your business. It’s tough because there are so many strategies. If you develop a new product or service that no one has in order to differentiate yourself, you will soon be copied and lose that edge. Re-bundle your services, same thing.

When I sat down with our customer advisory council about this, we were told our biggest distinction was our customer service. However, I am finding that difficult to market because I want the message to rise above the status of a platitude. When is the last time you went to a networking function only to hear people say the same old crap:

“We pride ourselves on customer service”

“We the most reliable, dependable, etc.”

blah, blah blah. It’s all talk unless you can prove it.

What I want to market, the story that I want to tell the world, is that we are the best at what we do. Something like:

“Everyone claims to have great customer service, but we can prove it!”

Some of the ideas I have had are:

• Promoting that we are the most recommended IT consulting firm on Linkedin.com (already using this)
• Customer Service Award from the Better Business Bureau or some other type of entity (we have a competitor that has done this

I’m not thrilled with the idea of awards because I think people today realize that many such awards are shallow victories. The chance of you winning an award these days seems to be more about who you know than actually possessing the merit to deserve the honor.

I need a way to prove that Carceron is the best at Customer service and I need a way to spread the word. Can you even market customer service?

P.S. If you have any other ideas around differentiation for a managed IT services business such as mine, I am all ears.

P.S.S. I’m not looking for a marketing consultant, so please don’t reply with a solicitation.

I’m sure that you have heard many variations of the advice that serves as this blog entry’s title like”outsource your weakness”. What’s not always clear when you hear these phrases is the context. Sometimes it applies to a person, sometimes to a business, sometimes both. I think it’s about evolution – a series of steps that starts out with you personally:

Step 1: Outsource Personal Weakness

I learned early on in business that I did not need to handle book keeping, and, a littler later on, tactical marketing (web sites, direct mail, etc.).  Reconciling bank statements, taxes, etc. are best handled by someone else, I quickly deduced. My undergrad training was in Psychology. I never took a single business class, so this was a no brainer. What’s been harder to let go of is marketing. My background in psychology has served me in understanding the clent and how to market to them in terms of messaging, but other tactical elements such as graphic and web design, collateral design, are all done better by the artsy types who can give your business a more polished look.

As Carceron grew, I began to realize that I wasn’t even the best computer technician and worked quickly to divest myself from that role to allow other, more capable, people run the day to day support operations of the business.

My next area to personally outsource? …Sales.

As I have grown the business, it was hard to see how tactical of a role sales really was until I had done it for a while. Now I realize that it is simply a numbers game. It’s about generating more leads (marketing and prospecting) and attaining better conversion rates (sales and sales training). I firmly believe that I could teach just about any good sales person how to sell what we do because the principals of selling are the pretty the same in any business. My training would give him the information needed to apply those principals..

In summary, you can outsource some of your personal responsibilities to outside vendors or employees. Evolving business owners and overwhelmed management alike must outsource their personal weakness in this way to get precious time back and/or to increase the quality of the area to be outsourced. This was the case of Jay, an operations manager for one of our clients. Jay ran the day to day operations of his company’s 16+ locations in addition to supporting its near 100 end users, while Carceron simply supported his server farm. Eventually he “cried uncle” and let Carceron take over all of their IT operations which gave him back 15-20 hours per week that he was spending on just supporting end users.

Step 2: Outsource Business Processes & Functions

As your business grows, you eventually see other areas to outsource to save money and/or improve quality. Some things make more sense than others. As a rule of thumb, don’t outsource anything that interferes directly with your client relationships… hold that sacred.

Here are some common areas of the business to outsource and why you should:

• Book Keeping: Save time, Accuracy, Cheaper than a full time employee (depends on the size of business and transaction volume)
• Payroll: Accuracy, IRS Compliance
• Human Resources: Compliance, Compliance, Compliance
• Marketing & PR: Social Media needs daily attention, a firm can do it cheaper than a full time employee
• Shipping / Delivery: What would it cost you to maintain a fleet of vehicle and drivers vs the cost of using a local courier or FedEx?
• Managed Services Provider (MSP): MSPs don’t get sick or take vacations, MSPs don’t need to be equiped or need benefits, MSPs cost about 1/2 the salary of a full time IT employee, click here to see a lot more reasons

Much of outsourcing is accomplished through the use of information technology which is an enabler towards issues like compliance, business process etc. Make sure that you understand the impacts on your IT infrastructure of anything that you plan to outsource before doing so.

You’ll also want to make sure that you have a good working relationship with all of your outsource vendors, constantly communicating your expectations.

Here are some other resources on outsourcing, well worth the read:

• 8 Reason Why Outsourcing Fails
• What causes outsourcing failures?

Off-shoring

When many people hear the word outsourcing, visions of call centers in a far away country pop up. Bare in mind that you can outsource without off-shoring. Put differently, off-shoring is 1 technique of outsourcing. When and why should you use this technique? In many cases it almost always comes back to saving money. Labor pools in other countries are generally cheaper and vast. It can also come about due to of lack people in country that have the necessary skills to carry out specialized kinds of work. This has been Microsoft’s argument for years – that University’s simply aren’t spitting out enough application developers (Watch the Bill Gates Testimonial to the Senate regarding this).  However, there are some trade offs:

• Language barrier: Many people get frustrated with call center operators where English is a second language. Also things can get lost in translation – this happens often for company’s that outsource software development abroad where misunderstandings about the scope of work often arise.
• External Politics: In the current state of this economy, where unemployment is so high, you risk a PR backlash by sending work overseas
• Internal Politics: Offshoring can have a direct impact on moral due to an “am I next?” mindset

Personally, I have not seen the need to offshore, however, I think it may become inevitable in order to compete unless legislation is passed to limit it somehow. As I am not an economist, I can’t say either way if that would be a bad thing or not. If we are of the mindset that we are now a global market place, would increased (presumably more restrictive) legislation help or hinder us? I simply don’t know…

• Why Offshore Outsourcing Projects Fail

There is some common business wisdom running around that says “Focus on doing what your business does best and outsource the rest”. I could not agree more. When it comes to information technology, this philosophy can be quite hard to comply with because everyone has some level of expertise with IT in today’s world. However, being able to fix a simple printer issue for an employee is a far cry from un-corrupting an Exchange email server database. And yet, it can be the “simple printer repair”-type issues that can eat up so much of your time without you even realizing it, to say nothing of the more complex errors sprinkled throughout this continuum of “Do It Yourself” to “Oh My God, HELP ME, the server is on FIRE!”.

If you are a professional services firm, your product is time. It is “inventory” that once it passes is gone forever (much like an unused hotel room). As such, for employees whom are billable, they need to devote as much of the workday as possible to billable activities. None of this should be very surprising, but if you observe many professional services firms you’ll see these billable employees doing everything from accounting to human resources to IT. If you work in a professional services firm, I encourage you to keep a very detailed log of every minute of your work day to see for yourself. Odds are you are getting caught up in all kinds of stuff that is better handled by someone else… who isn’t billable.

For accounting: get a book keeper or outsourced CFO. For human resources: try a full service PEO firm such as HR Outsourcing. For information technology management: enter into an agreement with a managed IT services provider. Here is why:

1. MSPs Are More Cost Effective: You can outsource the entire support of your network for a flat fee, including: monitoring, unlimited helpdesk hours, anti-virus software, anti-spam service, email archival and more, for only a few dollars per user per day (or less than 10% of one billable hour per day – assumes a network of 100 or less workstations)
2. MSPs Make You More Productive: A managed IT services firm will generally charge a flat fee for services rendered. This means that your firm will be more productive because it is in the managed IT service provider’s best interest to keep the network fully operational (each trouble ticket or monitoring failure eats into their profit margin).
3. MSPs Provide More Value: MSPs frequently bundle many other services into their managed services offering such as monitoring, anti-virus software, anti-spam service, email archival, and off site backup.
4. MSPs Are Better Than an In-House IT Manager: Managed IT service providers cost about ½ – 1/3 the cost of a full time employee. Unlike employees, managed IT service providers don’t get sick, don’t take vacations, come with their own insurance if they screw up, come with their own suite of software and services (e.g. anti-virus, monitoring, etc.) and don’t need to be equipped with laptops, mobile phones, etc. Besides, why would you put something as crucial as your business network in the hands of one man? A managed services provider will also have more skills sets and experience at their disposal.
5. MSPs Are Better Than a One Man Band: As with the In-House IT Manager, “Why would you put something as crucial as your business network in the hands of one man”? There are many talented one-man IT companies. But… What if something happens to him? What if he gets mad at you?  He can’t very well monitor your network if he is helping another client. What if you have a network emergency and he is with another client and can’t come to you right away? A managed services provider will also have more skills sets and experience at their disposal.

In summary, outsourcing management of you IT and other areas of your business can create massive leverage and allow your firm to bill more time. Now who does not want that?