The ConnectWise CEO says traditional IT spend has plateaued, making it more important than ever for MSPs to evolve their businesses.
ConnectWise CEO Arnie Bellini.
In the past, technology services providers have understandably been consumed with the “T” part of “IT.” Going forward, focusing on the “I” will be increasingly important.
That was the message from ConnectWise CEO Arnie Bellini, who sat down with MSPmentor today to offer his assessment of the state of the technology world and a vision of how MSPs should evolve to find success.
Global spending for traditional IT is expected to peak at $3.5 trillion this year and remain at that level going forward, he said. That’s why it’s more important than ever for MSPs to devise offerings around cloud and helping small- and medium-sized businesses to leverage technology to improve business processes.
“Traditional IT spend is leveling off from this year on,” Bellini said. “All the growth will be in cloud computing.”
He likened the IT services market to the building of the transcontinental railroad, where a massive effort was required to develop the infrastructure. Once the railroads were completed, demand dried up for track-laying skills and the focus shifted to moving people and goods along the existing infrastructure.
“We’ve spent the last 30 years building the infrastructure,” Bellini said.
“We need to move information to people when and where they need it,” he continued. “We need to make businesses more efficient with the technology infrastructure that we have.”
Earlier in the day, Bellini delivered a keynote to a standing-room-only crowd of more than 2,000 attendees at the IT Nation conference, currently underway in Orlando, Fla.
With cloud-based infrastructures, MSPs can more easily poach clients from one another, meaning that good customer relations will become more important than ever.
“World-class service has become an absolute necessity,” he told the audience, adding that: “Every touch point that you have with your customers, you need to think about that.”
MSPs that don’t measure customer satisfaction are making a mistake, Bellini said.
“A lot of people don’t want to do this because they’re afraid to find out that they’re not doing a good job,” he told the group. “You’ve got to get over that.”
Later, Bellini told MSPmentor that he’s been preaching for the past five years about the importance of adding cloud offerings and that ConnectWise is committed to helping MSPs succeed in that cloud-centric world.
But adoption by service providers remains “on the horizon,” he said.
“I think a lot of people are talking about it, but not a lot of people are doing it,” Bellini said.
“About 80 percent of our partners are doing something with cloud (but) I’d say only 20 percent of our partners have taken the steps that will create a new practice area in cloud,” he continued. “The other 60 percent are dipping their toes in the water.”
Bellini – arguably one of the foremost experts on the MSP space – said he understands the needs of ConnectWise partners so well because he continues to work among them.
His firm continues to run ConnectWise IT, a very early MSP that still serves about 200 customers in the Tampa, Fla., area.
“It’s the original company,” he said. “I am them. I live and breathe what they do every day.”
Bellini described a business model for launching a successful IT services firm from scratch today.
He would begin with a business analyst that would help SMBs to improve business processes through the deft application of technology.
“I would go in and teach them how to streamline their businesses,” he said.
From there, he would add managed security and cloud services practices.
“Then automatically take over all of the infrastructure,” Bellini said.
Such a company, he suggests, would quickly grow market share, swallowing up customers from less sophisticated MSPs.
“That’s what I’m trying to prevent from happening to MSPs,” he said.
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