Your customers are changing and they’re looking for an IT Service Provider that can offer three core services:
- An online sales and fulfillment experience
- One solution for everything they need
- The flexibility to buy on subscription
Considering these changes, it becomes important that you rethink how your business is solving for the customer—to match the way they want to buy.
To ensure the long-term success of your business, a significant focus towards digital transformation is required for both Value Added Resellers (VARs) and Managed Service Providers (MSPs).
Digital transformation enables you to remain competitive by helping you to save time, reduce costs, earn more revenue, and better serve your customers—all at scale.
We’ve talked to countless numbers of VARs and MSPs over the last year, and the one thing that we’ve learned is that everyone approaches this process differently.
So, whether you’re just getting started or well on your way, this blog post will provide a roadmap to ensure you reach your digital transformation goals successfully.
What is digital transformation?
Digital transformation is a modern makeover for VARs and MSPs that includes adopting new technology and digitizing existing processes. However, it also goes beyond these changes and requires you to shift your thinking about how you do business.
This involves integrating your tech stack to create a seamless flow of information, eliminating data silos, automating manual tasks, digitizing offline processes, and enhancing collaboration amongst your internal teams, partners, and customers.
Embracing digital transformation is a key driver for maintaining a competitive edge and being able to scale your business in today's fast-paced IT landscape.
For example, if you're still relying on spreadsheets while your competitor is using advanced CPQ software, they are quoting faster, offering more comprehensive quotes, and winning over the customer before you even have a chance to make your pitch.
What do VARs and MSPs need to digitally transform?
You need a collection of tools and APIs that help you automate and digitize your processes and offerings. The ideal digital transformation tech stack will vary depending on your specific needs, but it should typically include the following components:
- CRM software to manage customer relationships and track sales pipeline.
- CPQ software that allows you to build accurate quotes quickly and efficiently, pulling information from various sources within your tech stack.
- Accounting software to track finances and bill customers.
- Procurement software to help manage order fulfillment and the implementation process.
- ITSM software to automate your IT service delivery processes and improve your customer service.
- Monitoring software that helps you keep an eye on your IT infrastructure and identify potential problems before they cause outages.
- Smart APIs that help integrate your different IT systems and partners.
At a minimum, you’ll need CRM and CPQ software that integrate to get started. You’ll also want to make sure that your CPQ software is specially designed for IT. For example, HubSpot CRM and Central Office, or ConnectWise PSA (formerly Manage) and Quoter.
Most VARs and MSPs we’ve found use at least 5 types of tools with the total amount of tools in the double digits (10+).
The goal is to tie everything together digitally by creating connections between your tools and your partners so you can deliver solutions to your customers in a digital way.
Digital transformation challenges
Digital transformation is a big shift in the way your business operates, so it is important to be prepared for some growing pains. Here are a few things you should keep in mind when starting to digitally transform:
Legacy systems and integrations
One of the first challenges is transitioning away from legacy systems.
Yes, you’ve put a lot of work into your spreadsheets over the years, but once you see how much easier and more productive it is to use CPQ software that’s integrated with your CRM you’ll quickly forget all about them.
If you’re already using tools to replace offline processes like spreadsheets, then the question you need to ask yourself is are your new tools talking to each other effectively? Are you syncing data between systems in a useful way? Are the integrations between your tools eliminating manual tasks or creating new ones?
Some tools are limited in how they can connect to each other or your partners. Some don’t have any connections at all and setting up these integrations can be complicated.
Adopting new systems and processes can be challenging, especially when people are used to doing things the same way.
Effectively communicating the "why" behind your transformation with your team can help minimize pushback and make your transition smoother.
A phased approach can also help. This way you’re not forcing your teams to change everything at once.
Another way to lower the negative impact that change can have on your team is to make sure you provide easy access to training and success resources.
It might take some longer than others to come around but, in the end, this process is supposed to help everyone be more productive and more successful at work.
Cost and ROI
Going through a digital transformation typically involves allocating resources to purchase new technology, rebuild processes, and provide training.
The potential added expense you need to be aware of is a result of what happens when the new systems you purchased to automate a task, digitize a process, or add a new capability are not being fully utilized.
How do you make sure you're getting the most bang for your buck? It's not as simple as just buying a CRM or some quoting software and turning it on.
The key to making digital transformation produce the desired results (scalability, efficiency, speed etc.) lies in how well each one of your tools connects to each other and your different teams within your process or workflows.
Without proper planning and the right connective tissue in place, you can still end up with the same problems you have today. Siloed data, disconnected processes, and no way to scale.
Time to value
According to a 2022 survey by McKinsey, about 50% of executives said they started seeing value from their digital transformation efforts within the first year while 25% saw the full value of their digital transformation initiatives within the initial three years.
Another study from Deloitte tells us that, on average, it takes about 18 months to see value from digital transformation initiatives. But this timeframe can vary quite a bit based on how complex the initiative is.
While there are no one-size-fits-all stats, it's clear that digital transformation doesn’t happen overnight. That's why setting clear goals, appointing a project manager, and rolling out changes in phases can help speed things up and ensure your organization starts reaping the benefits as soon as possible.
Digital transformation benefits for MSPs
From expediting the quoting process through advanced CPQ software, to leveraging data-driven insights for better decision-making, here’s a few ways digital transformation can reshape your VAR or MSP business:
One of the more obvious benefits is eliminating manual and offline tasks with automation. This enables your team to move faster and get more done—reducing costs from inefficient processes.
For example, you can accelerate the quoting process, allowing you to quickly configure products and services, generate accurate pricing, and produce professional-looking quotes in a matter of minutes.
As a previous MSP, we used to spend up to 4 weeks manually producing quotes for network refresh projects using complex pricing spreadsheets, but CPQ software and a digital catalog helped us cut that time down 1-2 days if not faster.
Real-time decision making
Digital transformation enables faster and more data-driven decision-making by synchronizing information in real-time across various tools. This allows you to access, process, and use data swiftly.
Whether it's sending quoting data to your CRM, monitoring real-time product availability, collaborating with your team using automated handoffs, or staying informed about progress through instant notifications and progress trackers.
Modern customer experiences
If you think about the way that we consume things on a personal basis, we're buying products online and watching them get shipped to our house.
We're buying sandwiches and we know exactly where they are via apps on our phones.
We've heard actual customers say, “Why can I track a pizza and know exactly where it is in the process, but when I'm buying hundreds of thousands of dollars or millions of dollars in IT infrastructure from your company I don’t know where it is?”
With better connectivity between our tools and partners we can give customers real-time visibility into fulfillment. We can allow them to get a quote in minutes and then electronically sign the proposal and agreement.
How Central Office simplifies and accelerates the digital transformation process for MSPs and VARs
Central Office is your gateway to seamless digital transformation for your MSP business, and it's designed with simplicity in mind. We understand the frustration of dealing with lengthy implementation processes or the challenges of doing it alone.
That's why we've designed Central Office to be a plug-and-play solution, ensuring you are up and running in as few as 30-60 days.
Our business automation platform is tailored to the unique needs of VARs and MSPs, making it easier than ever to build, sell, and fulfill IT solutions.
Here are just a few of the things Central Office offers MSPs:
✔ Easily connect your hardware supply chain, service partners, and apps through a single online marketplace.
✔ Build a custom catalog of hardware, services, and support SKUs and build them into unique bundled offerings.
✔ Eliminate duplication, manual tasks, and Excel workarounds with integrated workflows for both products and services.
✔ Configure, Price, and Quote in minutes with embedded financing to calculate quotes as traditional CapEx or 100% on subscription.
✔ Automate SOW and Proposal generation using a library of templates directly tied to different quote types.
✔ A customer console keeps your customers digitally connected to you for ongoing opportunities.
✔ Grow your revenue on every quote with upsell services that you can add from the platform.
Central Office is packed with other incredible tools designed specifically for MSPs like you. If you're ready to see it in action and learn more, book a live demo with us today. We'll answer your questions, explore the features in detail, and show you how Central Office can help scale your business.