When the pandemic first hit earlier this year, nobody could have foreseen that we would be in lockdown again by November. With no signs of slowing down, the global health crisis is continuing to create challenges for businesses everywhere, but perhaps the biggest shock was the initial closing of offices when the UK was first told to work from home.
Many small and medium-sized enterprises (SMEs) were unprepared, scrambling to set up remote network access, cloud applications and the necessary security measures. Managed service providers (MSPs) suddenly found themselves in huge demand as they were called in to help customers with an overnight switch to remote working. Over the first few weeks, MSPs played a vital role in keeping businesses open. Several months on, they continue to deliver essential services to help SMEs weather the storm.
While initially the focus was on enabling secure and reliable remote working, MSPs are now discovering new ways to provide value to their clients. VoIP, business continuity, Azure migrations, hardware sales and business resilience solutions are all likely to drive revenue in the coming months. Social distancing has made it more challenging to carry out on-site work and some projects are delayed due to changing priorities or frozen spending, but others, such as new client PC rollouts, have accelerated. Some digital transformation projects that were previously on the back burner have become a priority, pushed along by the demands of the pandemic.
From challenges to opportunities
A recent survey by Datto (email required) of over 1,800 MSPs worldwide showed that while many MSPs had to adjust their growth expectations downward, they largely hope to survive the crisis; to uncover new opportunities. One in ten were even expecting revenue to increase. These MSPs have seen both security projects and cloud migration accelerate as a result of remote working. A large proportion expect to move critical client workloads off local hardware and into the cloud over the coming months, and they predict over 70 per cent of their clients will use Microsoft 365 cloud services within the next two years.
This trend is driving a growing need for security solutions, too. The pandemic triggered a wave of Covid-related ransomware, phishing and other malware-related attacks, prompting a security warning by the US Department of Homeland Security (DHS) Cybersecurity and Infrastructure Security Agency (CISA) and the UK’s National Cyber Security Centre (NCSC). Cybercriminals were tricking users into clicking on interactive Coronavirus maps in order to install malicious code – using the crisis to prey on organisations where they were most vulnerable.
The combination of remote working, the shift to the cloud, and attackers exploiting the situation means business data is more at risk than ever. MSPs will continue to play a crucial role in protecting SMEs from these threats. Many are currently implementing technologies such as SaaS protection and business continuity and disaster recovery (BCDR) for their clients, to ensure data is safely backed up and to minimise the risk of downtime and data loss.
Along with this, technologies such as remote monitoring and management (RMM), professional services automation (PSA) and file sync and share solutions have all been key in keeping businesses operating. When it comes to daily IT support, MSPs are dealing with more after-hours calls, as their clients are less likely to work standard business hours while they balance work and home responsibilities.
A trigger for positive change
The pandemic is a very real business threat, but it can also be a trigger for positive change. Some MSPs in the Datto survey saw it as an opportunity to optimise their internal processes and systems, which should provide a better foundation for growth once normal business resumes. MSPs with a solid cash flow even expected to acquire new employees and new clients, due to smaller or leveraged MSPs going out of business or missing SLAs. The pandemic may prompt further shifts in the market, as those looking to grow may be able to offer a lifeline to struggling MSPs through mergers and acquisitions.
The channel is certainly going to see a period of uncertainty and change, but those organisations that can adapt will likely emerge stronger out of this unprecedented crisis.
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