{ i } Mark S A Smith Also by Mark S.A. Smith Guerrilla Trade Show Selling Guerrilla TeleSelling Guerrilla Negotiating Linux in the Boardroom Security in the Boardroom The Accidental Landlord And many other custom written books for corporate clients. © 2018 Mark S.A. Smith. All rights reserved. All trademarks and registered trademarks are the property of their respective owners. Non-commercial reprint rights granted and use encour- aged with the following credit: “From MSP to BSP: Pivot from Managed Services Provider to Business Services Provider to Profit from I.T. Disruption by Mark S A Smith. Get details at MSPtoBSP.com” For other reprint rights, contact [email protected]. Published by The Bija Company, LLC www.BijaCo.com First Printing v1.0 Printed in the United States of America. { ii } From MSP to BSP From MSP to BSP Pivot from Managed Services Provider to Business Services Provider to Profit from I.T. Disruption As the world moves to mobile devices, the cloud, and Every- thing-as-a-Service (XaaS), Managed Services Providers (MSPs) become irrelevant. How can you provide managed services when there’s nothing left in the data center to manage? In this pragmatic discourse about the changing role of tech- nology business partners, you learn why this trend accelerates and how to pivot to be a Business Services Provider (BSP), where you work with C-level business executives to implement their roadmap by delivering foresight, management, and pro- tection irrespective of the location or ownership of the technol- ogy that runs their company. { iii } Mark S A Smith Disclaimer Neither the author nor the publisher assumes any responsibil- ity for errors, inaccuracies, or omissions. Any slights of people or organizations are unintentional. This publication is not intended for use as a source of secu- rity, technical, legal, accounting, financial, or other professional advice. If advice concerning these matters is needed, seek the services of a qualified professional as this information is not a substitute for professional counsel. Neither the author nor the publisher accepts any responsi- bility or liability for your use of the ideas presented herein. Conversely, neither the publisher nor author will lay claim to any profits you make based on the suggestions of this book. Some suggestions made in this book concerning business practices may have inadvertently introduced practices deemed unlawful in certain states, municipalities, or countries. You should be aware of the various laws governing your business practices in your particular industry and in your location. While the Web sites referenced were personally reviewed by the author, there are no guarantees to their safety. Practice safe Internet surfing with current antivirus software and a browser with active security settings. { iv } From MSP to BSP Dedication I dedicate this book to all of the I.T. reseller professionals who say, “There’s got to be a better way to sell I.T.!” You are the change agents who have the courage to bring disruptive prod- ucts and services to make the world a better place for all of us. I dedicate this book to you who practice the Golden Rule – “Do unto others as you would have them do unto you” (Mat- thew 7:12), which creates lasting, valuable customer relation- ships and disrupts the competition more than any other idea that I know. { v } Mark S A Smith Acknowledgements I’m grateful to my I.T. reseller colleagues for their ideas, input, and criticism. Whether it was a remark in passing, an axiom in an article, a line from a speech, or a direct “Mark, you need to think about this…” conversation, your thoughts and view- points enhance this book. Thanks to you who have “embroi- dered on my tapestry,” adding richness and depth. Thanks to my clients who let me master how to disrupt as we worked together, especially, Bill Hubler of IBM who hired me to speak to his sales teams over and over again, and Nicole Katrana of IBM who hired me to write dozens and dozens of executive business case assessment tools. Thanks to Chad Czerniak of Arrow Electronics who encourages me to expand my content after more than a decade of collaboration. Thanks to Rich Gooding and William Bailey of Synnex who embraced the potential of teaching business acumen to reseller partners. I thank Brent Green for his insights in the Lifestyle Expres- sion quadrant of the Customer Continuum model, Tony Bodoh for his insights into creating customer experiences that trans- form profits, Chris Stark for sharing his powerful executive management principles, and Pam Gordon for introducing me to Bruce Joyce’s work decades ago. Thank you to Joel Block for his prodigious insights into finance and business models. If I forgot to mention you, it’s because we need to talk. Thanks to my children, Harrison, Christina, Jennifer, Ste- phen, and Susanna who have taught me the wonders and de- lights of the Millennial mindset and made me a proud dad. Heartfelt thanks to my wife, business partner, and best friend, Molly Smith for her unerring wisdom, gentle encour- agement, and unending support. Because of her technology in- dustry experience in all parts of the I.T. food chain – reseller, vendor, distributor, and consultant – our consulting business thrives and this book exists. { vi } From MSP to BSP Contents Chapter 1: What’s Going On With I.T? ........................................ 1 The Never-ending Changes of Business .................................. 1 I Wrote this for I.T. Sales and Marketing Professionals ........ 3 Why Do I Have the Right to Write This? ................................. 4 My Motivation for Writing This ................................................ 4 How to Get the Most Out of This Book .................................... 5 Chapter Summary ....................................................................... 8 Chapter 2: What’s Causing Massive I.T. Disruption? ............... 9 Technology Change Outstrips Organization’s Ability to Change .................................................................................... 9 Digital Disruption Tanks Big Companies .............................. 10 Disappearing Data Centers ...................................................... 11 At-Capacity Corporate Data Centers Means There’s Nowhere to Go But the Cloud ........................................... 12 Mass Retirement of I.T. Execs .................................................. 13 From Paying for Ownership to Paying for Access ............... 14 Exponential Data Growth ........................................................ 15 Consumer Tech Disrupts the Data Center ............................. 16 Augmented Reality Disrupts Break/Fix ................................. 17 What’s the Opportunity? .......................................................... 18 How Do We Deal with This? ................................................... 19 Chapter Summary ..................................................................... 19 Chapter 3: All Business Models Pivot ........................................ 21 Wall Street Drives Business Models ....................................... 23 Business Rules Implement Business Models ......................... 23 Vendor Business Model Transformation ............................... 24 Distributor Business Model Transformation ......................... 27 Partner Business Model Transformation ............................... 29 Customer Business Model Transformation ........................... 31 Ten Fundamental Business Rules Pivots ............................... 37 Get Ready to Pivot Your Business .......................................... 43 Chapter Summary ..................................................................... 43 { vii } Mark S A Smith Chapter 4: Pivot Factor – Serve the Entire Data Value Hierarchy .................................................................................... 45 But, I Can’t Go Over the CIO’s Head ..................................... 45 The Data Value Hierarchy ....................................................... 46 Data Curators ............................................................................. 46 Data Creators ............................................................................. 49 Data Consumers ........................................................................ 51 Chapter Summary ..................................................................... 53 Chapter 5: Pivot Factor – Sell to Customer Motivation .......... 55 Your Business Success Factors ................................................ 55 The Origin of Traditional Sales Methods ............................... 56 The Difference Between Decision and Commitment ........... 57 Why Buyers are Liars ................................................................ 59 The Marketing and Sales Success Formula ........................... 60 What Happens When There’s No Motivation ...................... 60 Relationship Powers Sales ....................................................... 61 Product Positioning When the Time’s Right ......................... 62 The Heart of Selling is the 90 Percent ..................................... 63 Features, Advantages, and Benefits. Oh My! ........................ 64 The Biggest Problem with FAB-based Sales .......................... 65 Stop Selling Only Pain .............................................................. 66 What Changes? .......................................................................... 66 Uncovering Customer Motivation .........................................