Thursday 27 September 2007

Business Principles: Converting the Business Model to Managed Services

Karl Palachuk has an excellent series of articles on converting an I.T. business model to managed services: Managed Services in a Month.

There are a number of parts to the series, and all are very well rounded in their explanation of the methodology for the conversion.

One of the biggest benefits of the conversion process is getting a different perspective on the business that we run. It forces us to examine everything we do, how we do it, and whether it is beneficial to our clients and us or not.

As far as managed services go, there are a number of excellent benefits:
  • Improved and steady cash flow.
  • Billing ahead as opposed to terms behind the service.
  • Client Support Contracts/Agreements.
  • Prepaid hardware and software.
  • Enforcing the finance charges for overdue invoices.
  • Managed Services tiered pricing structure - Silver, Gold, Platinum or the like.
  • Client management and selection.
There are a lot of words out there indicating that I.T. support companies need to convert their business model or else. It is a common thread we have seen often.

Given Karl's excellent perspective on the subject, there is a much more positive reason to convert: It will grow our business and smooth out the feast or famine cash flow situations. It will deepen our business relationship with already established clientele, and provide a way for us to lock in new clients.

So, please give it some thought:
  1. Managed Services in a Month.
  2. Managed Services in a Month - Part One.
  3. Managed Services in a Month - Part Two.
  4. Managed Services in a Month - Part Three.
  5. Managed Services in a Month - Part Four.
  6. Managed Services in a Month - Part Five.
  7. Managed Services in a Month - Part Six.
  8. Managed Services in a Month - Part Seven.
  9. Managed Services in a Month - Part Eight.
  10. Final Thoughts: Managed Services in a Month.
For those of us who own and manage our own small businesses, we have already taken a huge risk and started our own company. That, in and of itself, is probably one of the most stressful decisions one can make short of mortgaging a house. That mortgage, and our family's livelihood now depends on us all the more! ;)

So, after careful evaluation of Karl's articles, it is not hard to see that one can indeed take on his suggestions and do it!

Philip Elder
Microsoft Small Business Specialists

*All Mac on SBS posts are posted on our in-house iMac via the Safari Web browser.


Karl W. Palachuk said...

Thank for the nice comments.

You should know that Nicko in my office reads your blog religiously. I don't know if he reads mine . . . but he reads yours!

Philip Elder Cluster MVP said...


Thanks for the affirmation. And thanks to Nicko for the support! :D


stryqx said...

On the Managed Services front, "Guide to a Successful Managed Services Practice" available from or is also a good resource.

And if you're reading Karl's books, make sure you grab a copy of "Relax Focus Succeed" and make sure you sign up for the newsletter. A fantastic resource.