MSPs Have A ‘Lot Of Room For Improvement When It Comes To KPIs
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Jay Fitzgerald
“There is a process of determining what is important in your business. ... If you don't know your numbers [key performance indicators], you're completely blind,” says Brett Jaffe, co-owner and strategy consultant at ConnectStrat.
Perhaps the most important indicator of the future success of a distribution company is the lack of knowledge of its owner in matters related to information technology.
Instead, success may depend on the business owner having good key performance indicators (KPIs), also known as metrics or smart numbers.
This is a message from Brett Jaffe, Co-Owner and Strategy Coach at ConnectStrat, a business consulting firm specializing in MSPs and other IT companies, on Monday in a packed room at CRN, the XChange NexGen The Channel Company conference in Orlando, Florida.
Jaffe, who once owned MSP, said he was unable to set and monitor KPIs such as financial, sales and marketing KPIs, and customer KPIs such as pilot aircraft management, among others. , lack of dashboard control to measure . altitude, airspeed and fuel level. During the flight.
"Well, if one of these [on-board instruments] fails, what happens? Collision. It's the same in business," Jaffe said. "There's a process of determining what's important in your business." ... If you don't know your number [KPI], you are completely blind.
According to Jaffe, KPIs are not just about financial goals. According to Jaffe, the metrics resulting from thoughtful KPI planning can alert business leaders to previously unknown issues in operations that require business adjustments. They can also change the strategic direction of a company.
Jaffe fires business owners who say "their business is doing well" without providing details, or that they "can't fill orders" and have a heavy workload. Such boasting can actually be a sign that something is wrong, he said, especially when a company cannot fulfill a promised order.
“If we don’t understand our KPIs, we don’t know why we do [something],” he said.
For example, it shows how financial KPIs can be applied to different segments of a company through debt-to-asset ratios, effective hourly rates, customer ratings by revenue and other KPIs, he said.
“It helps you focus on the things that really matter,” he says.
After the XChange session, Jaffe told CRN that some players on the network struggled to execute their trades efficiently.
“Many companies struggle with KPIs, and it's not because they don't understand the numbers. They have a number,” Jaffe said.
On the contrary, it is sometimes difficult for distributors to "compare" or define the standards to be achieved and then put those goals into practice.
Jaffe says one of the biggest mistakes a company can make is not acting on KPIs, such as failing to reach a goal and then doing nothing.
“They don’t have a plan of action,” Jaffe said. "They don't really have a good attack plan in what-if scenarios."
He said about network players and KPIs in general, "There's a lot of room for improvement."
Brian Bakkila, director of sales for Applied Innovation, an MSP in Grand Rapids, Michigan, says his company uses KPIs.
"That's one thing that's evolving," he said of the shift in KPI and analytics goals. “The challenge for you is that things are changing… you have achieved a certain degree of success in this area, to the point that it may be time to focus on something else.
And he said it's important to change the focus of KPIs.
“If for some reason you are suffering from customer dissatisfaction, you can focus on it for a while until you figure it out, and then maybe put it aside and move on,” he says.
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