How easy is it to transition existing customers to managed services?
In many cases, selling managed services to existing customers will prove more difficult for the managed services provider (MSP) than selling to new customers. This is because existing customers may not grasp the value of proactive network monitoring, service desk and vendor management if the MSP has done a splendid job of maintaining their networks in the past through their old service delivery model. Customers resist change, especially if there may be additional costs involved. The MSP may have historically provided such excellent service as a reactive firefighter that they encounter difficulty delivering a compelling value proposition to induce their customers to move to the new service delivery model.
In this situation, the MSP's biggest obstacle is the customer's perception of them and the organization. If they have done a good job of marketing themselves and conducting business as a trusted advisor and true solution provider, then the task is easier.
If, however, the MSP has operated in "break-fix" mode, and customers perceive the MSP as a reactive resource, it will be more challenging to change that perception. But this is exactly what needs to occur if they are to succeed in transitioning their existing customers to the managed services model.
Return to the managed services FAQ guide and read the rest of Erick's expert responses.
This was first published in September 2008