Should MSPs Go 'Colo' or Stay Solo?

The clear advantage an MSP can offer SMB customers or enterprise-level clientele is the ability to be nimble and agile, trimming the fat on overhead. One methods is colocation, or the industry-shortened "colo," a sceneario which has MSPs sharing costs of managing customer data and maintaining a customer network off site.

Here's a wicked idea: What if MSPs with similar interests went in together to set up a sort of "co-op" with the "colo" or a shareholder or jointly managed facility that could then be leased out to even smaller vendors or larger vendors?

Beyond red tape and cultural differences, it's a thought. there are some MSPs out there doing just that, either combining "colo" capabilities with their offerings or creating better margins by simply managing the processes for customers at a location either owned or co-owned by yet another third party.

According to Darin Stahl, senior analyst at Info-Tech Research Group, those that merely provide managed services on or off "colo" sites, where they support the customer's equipment can realize a 25 percent better profit margin in managed services.

This number gets more appealing if an MSP also owns the customer equipment or is partnered at a datacenter or "colo" site with a partner who owns or leases the equipment themselves.

If it still sounds like too many cooks in the kitchen, it should be noted that "colo" providers are becoming more appealing in the SMB space, especially in specialized verticals such as financial services firms and customer-service-heavy businesses that require large CRM emphasis, or housing data that needs to be accessed at moment's notice.

There are two general types of colocation providers: wholesale and retail. Depending on an MSPs business model it may be better to go "colo" than solo.

Posted by Jabulani Leffall on July 11, 2011 at 11:57 AM0 comments


Microsoft Partner of Year: Integrate Business Cycle

According to Sudipta Bhattacharya, president and chief executive officer, Invensys Operations Management, "You can't really manage and optimize your operations and achieve top profitability until you connect your business strategy to your production execution."

Bhattacharya should know, as he ranks high at a company that was recently honored as Microsoft Global Enterprise Partner of the Year in the category Alliance ISV Industry.

While Invensys mainly specializes in process in manufacturing, there are definite lessons to be learned here for the SMB space and those who serve them. The key takeaway: Effective technology processes are the crucial middle point between vision and implementation.

Bhattacharya, keynote speaker at Microsoft Worldwide Partner Conference, illustrates the point: "In most plants, the production floor isn't connected to the rest of the enterprise, and that gap is where much of the value is lost," he said. "Consolidating data for planning, scheduling, production and other operation's management tasks on a single platform allows everyone at every level of the enterprise to see and understand how their decisions impact profitability and productivity in real time. And that leads to faster, smarter choices."

The same philosophy holds true whether making hard industrial widgets or cupcakes, and, of course, it extends to services. Easy access to data, customer habits, inventory or service rollout planning should be at one central location or at least connected enough to reach the output point.

MSPs can learn from consulting shops all the way up the channel in that regard. When you integrate any business cycle using effective, storage, backup, network operations and database support, it's less of a headache and a foray to sure success in the best-case scenario.

Posted by Jabulani Leffall on July 11, 2011 at 11:57 AM0 comments