I decided to leverage AI to take a look at what MSPs should be dropping or adopting as service offerings. What I found is that AI made many of the same predictions that I’ve been making in this blog and in recent talks and podcasts.
Prompt
Based on the available market for Managed Service Providers (MSP) in the small business IT space, please make a prediction of what services small business will expect from their MSP 5 years from now. Take into consideration the historical role and service offerings provided by MSPs. Suggest how the service offering will need to change based upon your prediction. Please provide a detailed explanation of your prediction, including any assumptions, models or algorithms used, and any possible outcomes or scenarios. If relevant, please also provide any historical context, such as past trends or events that may impact the prediction. Please quantify your prediction as accurately as possible, such as with a percentage or range, and provide a level of confidence or uncertainty in the prediction. Finally, please make sure to include any potential limitations or risks associated with the prediction.
Much of this list will not surprise you. If you’ve been to a conference, attended a webinar, done any reading from industry leaders, then this should all be information that you’ve already heard. But have you internalized it or operationalized it yet? If not, then it’s time to get started. Five years will go by in a flash and meanwhile, clients’ expectations are changing incrementally along the way. The point to get started adopting these changes cannot be over emphasized.
Recall from the prediction that I also asked about limitations and risks. I’ve emphasized this part of the prediction.
Areas of focus for SMB MSPs in the next 5 years
Based on the search results, here is my prediction for the services small businesses will expect from their MSPs in 5 years:
Increased Demand for Comprehensive Cybersecurity Solutions
Small businesses will increasingly expect their MSPs to provide robust, integrated cybersecurity services. The search results indicate that SMBs are becoming more frequent targets for cyber attacks, with 73% experiencing an attack in 202314. To address this growing threat, SMBs will look to their MSPs to deliver holistic cyber protection, including vulnerability assessment, endpoint detection, incident response, and data recovery from backups34. MSPs that can offer a comprehensive, integrated cybersecurity solution will be in high demand.
Expanded Cloud and Collaboration Services
As more business workloads shift to the cloud, SMBs will expect their MSPs to have the skills and resources to manage cloud infrastructure and services2. Additionally, the rise of hybrid work models will drive demand for MSPs to provide solutions that support seamless collaboration, such as cloud-based productivity suites and communication tools2.
Leveraging AI and Automation
The search results suggest that the use of AI and automation will become the “new norm” for MSPs, requiring enhanced training and skills development3. SMBs will expect their MSPs to leverage AI-powered tools to improve productivity, detect and remediate security issues, and provide faster issue resolution3. MSPs that can effectively integrate and manage AI-based solutions will be better positioned to meet the needs of their SMB clients.
Delivering Exceptional Customer Experience
Improving the customer experience has become a top strategic priority for 44% of MSPs, recognizing its importance in a highly competitive market2. SMBs will expect their MSPs to not only provide reliable IT services, but also deliver a memorable customer experience through responsive support, proactive communication, and tailored solutions2.
Offering Virtual CISO (vCISO) Services
The search results indicate that the demand for vCISO services will grow significantly in 2024, as SMBs seek comprehensive security expertise that they may not be able to afford in-house4. MSPs that can provide vCISO services, leveraging automated platforms to reduce overhead, will be well-positioned to meet this growing need and differentiate themselves in the market4.In summary, my prediction is that in 5 years, small businesses will expect their MSPs to provide:
- Comprehensive, integrated cybersecurity solutions (80-90% of SMBs)
- Expanded cloud and collaboration services (70-80% of SMBs)
- Leveraging of AI and automation to improve productivity and security (60-70% of SMBs)
- Exceptional customer experience as a strategic priority (70-80% of SMBs)
- Virtual CISO (vCISO) services to address security expertise gaps (50-60% of SMBs)
This prediction is based on the trends and insights gathered from the search results, which indicate a clear shift in SMB expectations and the evolving role of MSPs in the small business IT landscape. However, it’s important to note that the actual adoption and demand for these services may be influenced by factors such as technological advancements, regulatory changes, and the overall economic climate. Additionally, the ability of MSPs to adapt and invest in these capabilities will be a key determinant of their success in meeting the evolving needs of their SMB clients.
What MSPs need to do to adopt these new services
- Adopt a culture of change
- Expand employee training investments
- Hire staff with collaboration, security, productivity, prompting and training skills
- Invest in AI assistants
- Create a culture of gratitude and customer service
- Value soft skills as highly as technical skills
None of the above are things that MSPs are particularly good at today. Most are made up of people are interested in the field because they are good fix-it people. Very quickly, being good at fixing things is going to become a low value skill.
Prompt
What are the services that MSPs should focus less on or drop from their service offering? Please create a table.
Based on the search results, here is a table outlining the services that MSPs should focus less on or drop from their service offering:
| Service | Reason to Focus Less or Drop |
|---|---|
| Device Management | The search results indicate that MSPs should focus more on cloud and collaboration services, as well as leveraging AI and automation, rather than traditional device management. Automating routine tasks can free up technicians’ time for more strategic initiatives. |
| Software Patching | Similar to device management, the search results suggest that MSPs should look to automate routine tasks like software patching to improve efficiency. |
| Hospitality and Retail Clients | The search results note that some industries, like hospitality and retail, may not require expanded MSP services, as their needs may have changed due to the pandemic. MSPs should focus on industries and clients that have growing IT needs. |
| Standalone Cybersecurity Services | The search results indicate that SMBs will increasingly expect their MSPs to provide comprehensive, integrated cybersecurity solutions, rather than standalone security services. MSPs should focus on delivering holistic cyber protection. |
| Generalist Approach | The search results suggest that MSPs may want to specialize in a particular niche, such as a specific industry or service specialty, rather than trying to be a generalist provider. Specialization can help MSPs better meet the unique needs of their target clients. |
By focusing less on these services or dropping them from their offerings, MSPs can free up resources to invest in the areas that will be in higher demand from small businesses in the next 5 years, such as cloud, collaboration, AI/automation, cybersecurity, and customer experience.
Conclusion
There’s a lot to digest here. Device management, software patching and generalist services are the foundation of nearly all small MSPs and other types of service providers. Pull those from your service offerings today and what remains? What needs to remain is the list at the top of the page, but it will take a significant business reorganization to achieve success in this rapidly changing market.
I have written a lot about this topic in recent years. See this collection of articles for my suggestions, take and concerns.
It is also important to notice that cybersecurity is not predicted to be relegated to the MSSP. Security becomes everyone’s job. But for the MSP, productivity, training, business enhancement, is their unique domain.
Sources
- What Is an MSP (Definition, Solutions, Offerings) (kelleycreate.com)
- Managed Service Provider (MSP) Best Practices: A Guide to Delivering Excellent IT Services | Scribe (scribehow.com)
- Five Advantages of a Master MSP | Dropsuite
- The Full MSP Startup Guide – ConnectBooster
- (3) Eight Ways to Scale Your Managed Service Provider Business in 2022 | LinkedIn
- 2024’s MSP cybersecurity predictions | ConnectWise
- Looking into 2024: Security Predictions for MSSPs and MSPs | MSSP Alert
- 2024 Trends For Managed Service Providers (forbes.com)
- 9 actions that MSPs must take to drive success in 2024: Datto Report | Daily Host News
- N-able CEO Pagliuca: 2024 MSP Challenges & Opportunities | ChannelE2E
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