15 Best Practices for Sustainable MSP Growth in 2024

Managed Service Providers (MSPs) play a critical role in today’s technology-driven business landscape. Their outsourced IT managed services, and support to organizations of all sizes, result in business agility, competitive advantage, and cost savings. 

As the demand for MSPs continues to grow¹, so does the need to develop sustainable best practices and strategies to help managed service providers scale and succeed in a competitive market to ensure MSP growth.

MSPs, globally, face these 7 challenges²:

1. Acquiring more customers (95%)
2. Counteracting novel security threats (61%)
3. Hiring (58%)
4. COVID-induced IT budget shrinkage (32%)
5. Customer retention (22%)
6. Supporting remote work for staff and clients (19%)
7. Reduced service offerings to fit shrinking customers’ budget (11%)

In this article, we will discuss the 15 best practices an MSP business should follow to ensure MSP growth to fuel their growth and adapt to new competitors in line with this rapidly-changing landscape.

1. See customers’ challenges as growth opportunities

According to Kaseya’s 2021 survey³, the biggest growth opportunities for MSPs are the following (Figure 1):

MSPs should view their customers’ challenges as growth opportunities and gaps to fill. For example, when it comes to providing cybersecurity solutions, most MSPs have provided some sort of antivirus or anti-malware solution. Or for maintaining business continuity, “network monitoring and management” has been one of the popular provided services (Figure 2).

No matter the niche that your MSP is catering to, some problems are common all across the board. Having the vision and clarity to address those is a growth potential.

A downside of an expanding MSP market, and too many MSPs, is your business being crowded out. Offering a mix of services, such as proactive maintenance, cybersecurity, cloud services, and consulting, in a specific sector helps differentiate you amongst other MSPs. The other benefit is upselling and cross-selling your products.

2. Expand your services to automation via strategic partnerships

Establishing strategic partnerships with leading technology vendors has two use cases for MSPs: 

• Using the product for in-house use
• Tailoring and selling the product to customers

Partnerships result in MSPs having access to innovative technologies, resources, and training to take advantage of themselves, and to offer to clients. For example, RPA, or robotic process automation, can be useful for MSPs in: 

• Better management of rule-based IT tasks 
• Efficient data warehouse management 
• Streamlined customer service request handling 

Alternatively, MSPs can partner with an RPA vendor to offer their services to clients in a more tailored manner. 

Learn more about choosing an RPA technology partner by reading our whitepaper on the topic:

Guide to Choosing an RPA Technology Partner

3. Develop a Scalable Business Model

A 2020 report⁴ showed that following the pandemic, MSPs faced scalability issues. Specifically:

• 54% lacked enough time to finish tasks
• 53% couldn’t hire adequate personnel
• 32% were unable to handle new technologies
• 27% lacked a clear framework for information sharing

So MSPs should focus on enhancing their scalability as the digital transformation market grows. For example, MSPs could utilize an RMM (Remote Monitoring and Management) solution to monitor, manage, and maintain client systems remotely. The benefit would be less need for on-site visits, lowered operational costs, and helped scale business by managing more clients with less resources.

4. Attend Industry Events & Conferences

Attend local and national events, participate in panel discussions, or host workshops to showcase your expertise and raise your MSP’s profile within the industry. Networking at industry events and conferences can help MSPs build valuable connections, stay informed about industry trends, and generate new leads to power their MSP growth.

Some notable events include:

1. IT Nation Connect: Hosted by ConnectWise, IT Nation Connect annually brings together MSPs, technology vendors, and industry experts to discuss the latest innovations, share best practices, and participate in networking events.
2. DattoCon: Organized by Datto, this conference focuses on managed services, data protection, and business continuity. It offers keynotes, breakout sessions, and networking opportunities for MSPs to learn and grow their businesses.
3. MSPWorld: Hosted by the MSPAlliance, MSPWorld is a premier conference for cloud and managed service providers. The event features presentations from industry leaders, networking opportunities, and interactive sessions on topics such as cybersecurity, sales and marketing, and operational best practices.
4. ChannelPro SMB Forum: This one-day event is targeted at MSPs and IT service providers who serve SMEs. It offers a mix of education, networking, and collaboration opportunities, with a focus on business growth and technology trends.
5. ASCII IT Success Summits: These regional events, organized by the ASCII Group, offer educational content, peer networking, and access to new technologies and solutions.

5. Prioritize Customer Success and Retention

22%⁵ of MSPs struggle with customer retention; 95% have trouble acquiring new customers. So MSPs growth success depends on retaining and acquiring customers.

Besides exceptional customer service, proactive support, and regular communications, MSPs should also cater to their customers’ evolving needs.

For instance:

• 73%

6. Focus on Security and Compliance

As cyber threats continue to grow in number⁶ and sophistication⁷MSPs must prioritize security and compliance to protect their clients’ sensitive data and maintain trust. 

Develop a robust security strategy that includes regular risk assessments, penetration testing, and vulnerability management. Also, stay current with industry-specific compliance standards and regulations to ensure your clients and other providers’ data and systems are protected and compliant.

Explore compliance automation more.

7. Invest in Training and Certification

Since 2016⁸ there’s been a 145% increase in the number of IT decision-makers claiming a workforce skill gap, culminating in 76% of them saying that they suffer from the issue.

Invest in ongoing training and certification programs to ensure your teams are up-to-date with necessary skills and knowledge for providing cutting-edge solutions. Encourage your employees to pursue industry-recognized certifications, and stay informed about emerging market trends and technologies to stay ahead of the competition.

8. Guide Clients in Their Latest Challenges in AI/digital transformation

These factors are pushing businesses to think critically about their cost base and look for automation opportunities:

• Rise of generative AI which the public realized with the launch of ChatGPT.
• Rising interest rate environment and focus on efficiency

By establishing thought leadership in how generative AI can help your clients and guiding buyers in their AI transformation journey, your MSP can develop deeper relations with its clients.

Try: 

• Bundling complementary services 
• Offering tiered pricing 
• Or implementing flexible payment options to cater to various client preferences and budgets

Learn more about pricing optimization.

9. Invest in Marketing and Sales

MSP growth is dependent on a comprehensive, omnichannel marketing strategy, including social media, email marketing, content marketing, and search engine optimization (SEO). 

A strong online presence, combined with an effective sales strategy, will help you in:

• Seeing new opportunities
• Lead generation
• Engaging with prospects
• Closing the deals

Consider investing in marketing automation tools to streamline your marketing efforts and provide your sales team with qualified leads.

10. Embrace Industry Trends and Innovations

Staying informed about emerging tech and larger industry trends helps in maintaining a competitive edge. Integrate innovative solutions and services, like AI, IoT, conversational AI, RPA, and edge computing. This will help you attract new clients and enhance the value of your existing offerings. 

11. Optimize Pricing and Service Packages

To stay financially competitive, align your pricing strategy and service packages with your target market’s needs and expectations. You should regularly review your pricing models and service packages to ensure they’re competitive and offer the best value for your clients. 

Try: 

• Bundling complementary services 
• Offering tiered pricing 
• Or implementing flexible payment options to cater to various client preferences and budgets

Learn more about pricing optimization

12. Utilize Client Testimonials & Case Studies

Showcase your MSP’s successes and capabilities by sharing client testimonials and case studies. These can serve as powerful social proof, helping to build trust and credibility with potential clients. Share these success stories on your website, social media, and marketing materials to demonstrate your expertise and the value of your managed services.

These factors are pushing businesses to think critically about their cost base and look for automation opportunities:

• Rise of generative AI which the public realized with the launch of ChatGPT.
• Rising interest rate environment and focus on efficiency

By establishing thought leadership in how generative AI can help your clients and guiding buyers in their AI transformation journey, your MSP can develop deeper relations with its clients.

13. Monitor & Measure Success

Growth should be measured with KPIs and other metrics to track performance. These measurements can help identify areas for improvement, set goals, and assess the effectiveness of your growth strategies and initiatives.

14. Implement a Referral Program

Word of mouth and referrals can boost your MSP business’s growth.

Develop a referral program that incentivizes existing clients to recommend your services to their contacts. This can involve offering discounts, free services, or other rewards for successful referrals, helping to generate new leads and expand your client base.

15. Cultivate a Strong Company Culture

A strong company culture can attract top talent and contribute to employee satisfaction and retention. Create a supportive and inclusive work environment that promotes collaboration, learning, and growth. Recognize and reward employee achievements, and encourage open communication and feedback to foster continuous improvement.

External Links

• 1. “Managed Services Market to Reach $393.72 Billion by 2028.” GlobeNewswire. July 07, 2022. Retrieved on May 2, 2023.
• 2. “Managed service providers business challenges worldwide in 2022, by region.” Statista. August 8, 2022. Retrieved on May 2, 2023.
• 3. “2021 MSP Benchmark Survey.” Kaseya. 2021. Retrieved on May 3, 2023.
• 4. “IT Glue 2020 Global MSP Benchmark Survey Reveals Impact of Pandemic on State of the Industry.” Kaseya. June 15, 2020. Retrieved on May 2, 2023.
• 5. “Managed service providers business challenges worldwide in 2022, by region.” Statista. August 8, 2022. Retrieved on May 2, 2023.
• 6. “160 Cybersecurity Statistics 2023.” astra. May 2, 2023. Retrieved on May 2, 2023.
• 7. “Cybercriminals Becoming More Sophisticated: Report.” myBUSINESS. February 17, 2022. Retrieved on May 2, 2023.
• 8. “Global Knowledge 2021.” Skillsoft. 2021. Retrieved on May 2, 2023.