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The Next Stage of Life for the IT Company

There is a lot of coverage at industry conferences, literature, and forums about the state of the IT “company” universe. There is a lot of disruption and consolidation. Large IT firms are acquiring smaller firms, Microsoft and Apple are directly competing with IT firms for support — not just at the larger, enterprise level but directly competing with IT companies for SMBs. Many customers are pushing back against IT support contracts because “it’s in the cloud.” What’s an IT company to do? To think?

The bad news is that everything I wrote above is absolutely true. Right now is a highly volatile time for the IT support industry.

The good news is that this has happened before, and it will happen again. And again. And again.

While this predates my time in IT, Novell NetWare is widely credited with the shift from centralized IT to departmental IT. This is when department managers were able to fund IT at their budget-level, and this is what ultimately pushed a lot of IT advances in business to the frontline worker. But we also know that another shift occurred where IT became so decentralized and, ultimately, expensive to manage, that the “corporate IT” concept came back into fashion and corporate systems consolidated IT back into a single governance and management model.

Right now, we are entering the “NetWare Cloud” era, if you’ll excuse the butchered phrase.

Power has begun to shift back to department and line managers, especially when it comes to software and systems readily available in the cloud. Think of how easily a department manager can now spin up a cloud-based dashboard, connect various application feeds to it, and use those KPIs to manage their team? Zero need for centralized IT if we focus just on that need. No servers needed, no complex DBMS hot/cold mirroring, just a RESTful life of connections and data.

If your IT company, or IT department for that matter, is focused on managing IT at the asset level, you are doomed. It won’t be today. It won’t even be tomorrow. But within 2-3 years, you will see your revenue dramatically decrease as customers begin exiting for no reason other than “but it’s in the cloud.”

In reality, within several years, we will likely see a shift back to a centrally managed IT model (just more “cloudsy”) because of data loss/theft due to mismanagement in connecting all these systems, the lack of true identity federation/control, and everything else that also plagued the NetWare era of computing. The brutal truth, however, is that IT firms focused on managing IT strictly at the asset level won’t be around when that shift back to a more controlled model comes around.

Because of this, you need to shift, and shift hard, now.

What is your VALUE?

I remember when I had a Microsoft rep meet me at my MSP’s office about 5 years back (Rocketship is the SaaS company I spearhead, but it came out of my IT and training firm, Puryear IT). The rep kept asking me “what VALUE are you going to provide?” It was crystal clear to me then that what he was really saying was: “If you only focus on infrastructure management, you are dead in the water.” I also had no doubt that Microsoft was slowly working to enter as a competitor in the IT support market. I remember telling peers to be ready for it, with some agreeing but many disagreeing. (Their response definitely did not age well!)

What is your VALUE?

You need to reevaluate your entire marketing and business strategy today, RIGHT NOW, if you want to be here in three years. If your value is “managing IT infrastructure,” you are a dead man walking. You are set to compete against massive companies like Microsoft, Apple, and Amazon. And your advantage? The thing that you scream loudly at the top of every mountain as your “competitive differentiator” that will ensure you stay on top? You are saying “my relationship with the customer sets me apart.” Did I nail it? And it sounds great, right? Except attrition does not care about relationships. Attrition is the enemy of complacence. Attrition is why you will ultimately lose.

What is your VALUE?

Pivot now. Find value where you haven’t provided it before. For my MSP, we shifted into business workflow/process consulting and user training. For you, it may be something else entirely. Certainly, it needs to align with your strengths and ability to expand into that service line. In other words, ensure it is achievable, but, 100%, you need to identify areas higher up the “value chain.”

This doesn’t mean to abandon ship. Your IT support will still be key. However, begin adjusting your company so that IT support is the FOUNDATION of your offer. It’s the bedrock upon which your customers gain trust of you and your team. From that bedrock, find new VALUE to offer that helps them in HR, accounting, marketing, or another department that consistently causes pain for companies, whether they are in the cloud or still using a 40-year-old NetWare 3.0 file server in the closet.

For Puryear IT, when asked what we do, for years we have told people “we manage IT and train people to use it.” We have Microsoft Certified Trainers (MCTs) on staff, and have established IT+training as our value. Now go figure out your own “IT and…” statement that causes people to say “oh.. yeah, that is important!”

UPCOMING WEBINAR

After writing this blog, I realized this would be an excellent webinar. I just shifted our next planned webinar back 3 weeks and we’ll host a webinar dedicate to finding your new service line in the webinar “Redefine Your Value for the New IT Market.” Interested? Sign-up for the webinar here.

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