Steer Clear from stress during times of crisis
In the Managed Service Provider Channel, it has been observed that 25% of service providers are in dire need of critical cash management. But the crisis management is very different from how we know it. The overall fundamentals of managing the business don’t really change even during a crisis situation. Ransomware attack, natural disaster, keyman illness, whatever might be the case, there are some practical and effective ways to combat it.
As long as an MSP is open and willing to change the orthodox ways to create new opportunities it is possible to find a survival tactic. You might witness that some new and different opportunities emerge as a way to expand as well as grow overall business even in the recession-induced crisis situation. The COVID-induced recession is the major force behind the transformation of the digital world of MSPs.
Changes are inevitable irrespective of how hard they may seem. Identify the problem, then find the root cause of the problem, make a decision as to what the solution should be, then figure out the overall cause, decide on the solution, frame the right metrics, execute and measure the overall results.
PHASE 1: Assess
Goal – This assessment phase is all about figuring out your current position, meaning, where you actually stand. It indicates that you must determine how bad the situation is and address it. Be sure to understand how you go there and define what would be a successful way to look forward.
MSP cash crisis response – It is all about determining the capacity, this is the major key. It is important that you give it a look that how your major three business areas are performing, namely: Sales, Finance, and Operations.
- Sales – What is the market and sales capacity? What does the current market look like? How much money can be made in the market that delivers IT service? Are there some emerging opportunities that you have ignored and those need you to be vigilant? What is your current market spending? These are all the necessary questions you must address.
- Operations – Labor capacity or what your team size is, matters a lot. It is also important that you know of all the services that are sold currently. Utilization is a pretty good metric that you must look at and see how much work is put into your team to produce desirable results.
- Finance – It is what encompasses the working capital capacity. Current assets are divided by the liabilities. This goes out to show that short-term financial obligations are met when you have realistic goals set. Financial health of your business is important and must be assessed due on time. If the KPI is skewed you must find other ways to conserve cash.
PHASE II – Manage the Cash Flow
Four focus areas are:
- Spend less
- Pay out slower
- Sell more
- Collect cash
PHASE III – Plan
Figuring out an exact plan where the cost can be reduced and the assets can be liquidated for cash, as well as the staff can be managed for maximum productivity, control the cash flow, as well as funding.
PHASE IV –Implement
After the plan is identified you immediately move towards a better implementation.
At Single Point of Contact we ensure that the best business strategy is maintained for your business. Single Point of Contact acts as an extension of your business which means that your customers are assured security and the best quality service. From offering 24/7 computer support to managed security services. To learn more about how we can help you build a sustainable business, protect your clients from cyber-attacks, and deliver a 24-7 help desk, contact us today.
