I always enjoy speaking with fellow CEOs in the MSP channel and sharing thoughts with them on many topics that we encounter daily. The topic that comes up quite often regards tech talent challenges, especially since the pandemic. Talent shortages. Quiet quitters. Remote workers. Retention. So, from those great conversations I have ranked what I believe to be the top three that can have a direct impact on an MSP’s finances, operations, and overall future.
The challenges outlined below are even more significant when an MSP is funded by private equity. The pressure is then on the CEO to not just lead a thriving business, but to generate enough funding to produce heavy ROI ― because operating at a loss is not an option. Not that it is truly an option for any CEO, but there is certainly less financial flexibility in a PE environment.
Top 3 Tech Talent Challenges
- Profitability – Talent costs have risen over the past two to three years, but customers are resistant to price changes, causing MSPs to see a decrease in service margins. This significantly reduces the budget allowed for key areas like sales and marketing, or GMA, since these are typically lower priorities than service costs on a P/L statement.
- Cybersecurity – MSPs often have a tough time portraying the value prop of their cybersecurity services to their customers, which is troublesome especially if CSaaS (Cyber Security as a Service) is a key revenue driver. Add to that the ever-increasing level of channel noise from vendors and new products, the cost of cybersecurity talent, and the overall availability of good engineers. These and other issues explain why MSPs struggle to build and maintain a strong cybersecurity practice.
- General Talent Issues — Hiring, retaining, training, and engaging the workforce causes headaches for MSPs daily. They are time-consuming tasks that are imperative to your business. There is a positive impact on the business when the right team is in place and is adequately staffed to best support the current and future clients. However, today’s job market and current economy makes team building difficult. Businesses need to work extra hard to retain the talent they have by focusing on workplace culture, which is often seen as non-revenue generating activity, and therefore is not prioritized.
Over my 20 years as an MSP owner, I’ve faced all these challenges. Many of the talent solutions that my company, IT By Design, offers were borne from these experiences. From our full bench of MSP-trained engineers to Team GPS employee engagement platform, all our products and services are created exclusively for MSPs. So when you are in the market for a true partner to address the talent challenges you’re facing, please reach out to me or my team. We’ll help you hire the right tech talent, bolster your culture, reduce turnover and positively impact your ROI.