Wins and Challenges in Growing a Managed Services Practice (MSP)

Ole Gjerde [00:00:00]:

So my biggest thing is security. You know, we're a fully remote company, so that means the laptops are either in somebody's house or at Starbucks or in a hotel. So it is 100% of the time in a hostile environment. I mean, our houses is probably the worst environment because you never know. Like, it's a little scary actually, because security to me is one of those things is how do you truly lock down a laptop that's always essentially in a hostile environment? And so you want to find an MSP that solves those problems that you're looking for.

Neil Benson [00:00:29]:

G' day and welcome to Practice Leading, a podcast for emerging and curious practice leaders of Microsoft partner businesses. If you're anything like me, with an unquenchable thirst for improvement and zero tolerance for bs, you've come to the right place. Hi, I'm Neil Benson and this is my personal invitation for you to join me on my own journey of discovery. Together we'll learn from innovators and investors and executives and entrepreneurs, business leaders and business coaches that have already left their stamp on the Microsoft community and those that are exploring new and smarter ways.

Neil Benson [00:01:04]:

Of building their businesses.

Neil Benson [00:01:05]:

Whether it's groundbreaking innovations, hiring high performing teams, or the sheer force of will to disrupt our industry, each episode is a masterclass from the trailblazers who have already achieved significant success. Find PracticeLeading on YouTube or visit PracticeLeading.com and learn from the mentors you wish.

Neil Benson [00:01:23]:

You had earlier in your career.

Neil Benson [00:01:27]:

G' day and welcome back to Practice Leading. Thanks for joining me again. Are you thinking about launching a managed services practice? Or maybe you're a full msp? A Managed services Partner My business Superware is about to launch a managed application support practice. So today I'm learning from Ole Jordi. He is the CEO of True North Dynamics and he's going to teach us all about the ups and downs of adding managed services to a consulting business. Oli built a custom software business before running a managed services business, before running a business applications business, so he's run the full gamut of business models. Olay shared lessons from years of building, merging and separating MSPs and why focus and a clear division of teams are crucial for success. We also discussed when it's smart to outsource your own internal technology support for any Microsoft partner or and if you're going to launch an application support practice or MSP business, how to structure pricing for real customer value, and why it's more important than ever to prioritize transparency and partnership with your customers.

Neil Benson [00:02:32]:

If you Want to scale your business the right way, you don't want to miss these insights. Here's Olle Jordi from True North Dynamics.

Neil Benson [00:02:42]:

Ola, welcome to Practice Leading. Thanks so much for joining me on the show. How are you doing?

Ole Gjerde [00:02:46]:

I'm doing great, thanks for having me.

Neil Benson [00:02:48]:

I reached out to you because my business, Superware is about to start a managed service line of business. It's not completely new to us, but we're hiring into it for the first time rather than just having one of the co founders provide support. And we're supporting business applications. Not a full gamut of hardware and software, networks and logins and everything, but it's an area you've got a lot of experience in. Do you mind sharing a quick background with some of our listeners? Sure.

Ole Gjerde [00:03:16]:

So my name is Ola Jerdy and I'm the CEO of TrueNorth Dynamics. Obviously we do Dynamics today, but obviously my story is a little more complicated. So the quick version of it is I started my first IT company when I was in college in the late 90s. I grew that for about 10 years, merged with another IT company. That was a bad idea. So that didn't work out. So we walked away. We started a pure play MSP.

Ole Gjerde [00:03:38]:

So only fixed fee services. In 2012 grew that to about, I think we're about $3.5 million. And we acquired a Dynamics practice that was what is now True north. Trying to combine the two companies turned out that was a very difficult and challenging thing. So after about three years we actually gave up and we spit them back out. MSP has been sold off to somebody else and here I am after 24 years of IT services, running a company doing business applications, everything from CRM to ERP only, which is definitely been quite the road.

Neil Benson [00:04:18]:

You're scared of me now. Is it a bad idea to have a managed service practice as part of a business applications business? Am I crazy? Am I going to end up regretting this move?

Ole Gjerde [00:04:29]:

So it's an interesting question. Now part of that is maybe unpacking what is an MSP and what part of an MSP we're talking about. What I would say is for smaller msps Dynamics practices. I actually do think it's a very bad idea. The kinds of people you're typically hiring are going to be different. The target market for clients are going to be a bit different. Dynamics is typically going to be a little bit more into larger S and P to mid market. MSP is obviously more small business.

Ole Gjerde [00:04:55]:

Now if you do co managed, that's a whole Nother story because now you're playing more in the mid market space. And so, so I think for smaller ones, if you're big enough and you can have truly two separate areas where there's a separate set of leadership to truly have focus. I think work. What we ran into is that we, all of us owners, there was three of us running, you know, part of, part of the business. We were all involved in both parts of the business that I don't think can work. You need to have true focus, I mean true for anything in business. If you want to be successful, you have to focus not necessarily on one thing, but you have to have clear focus and have enough commitment to every part to make it work. And then having it be in one company, what does that mean? If you run it kind of as a two separate, truly separate divisions, I think they can be fine together.

Ole Gjerde [00:05:42]:

I think as a smaller cohesive company, maybe we're just not smart enough to make it happen. But I would be very concerned that it would be a big challenging thing. But I guess my first question is typically an MSP covers everything from obviously help desk for end user support, email, Office365, managing security, really covering almost anything when it comes to technology from a desktop laptop, servers, firewalls, networking and that kind of stuff. So I guess, you know, are you foreseeing it being kind of holistic across all of it or is it a very particular kind of niche as part of that?

Neil Benson [00:06:20]:

No, no. So in fact we're going through the exercise of finding an MSP to support our hardware, do end user support, look after identity and security, Microsoft 365, because that's not our core business, we have no expertise in that area at all. So we're going to outsource that to somebody who's, who's bread and butter is doing that for our managed, I guess it's a managed application support business. We're just going to manage Dynamics 365 and Power Platform applications, starting with the ones that we've built and deployed for our customers. And then if we find another customer who's, you know, maybe deployed an application themselves or had another partner do it and a partner doesn't provide support, then we'll maybe consider supporting applications that other people have built. But I'm a little wary of inheriting other people's skeletons in the closet. So what was it like when you're an MSP and you're picking up somebody else's network or all their IT problems for the first time, there must be Quite an onboarding project to figure out where everything's broken.

Ole Gjerde [00:07:22]:

It is a really big challenge. Throughout the years we've been in not only IT services, we also did custom software development for a long period of time. So truly building custom solutions, in which case we did do exactly that take on an application somebody else built and we're going to take over maintenance and that kind of stuff. It's a big challenge. I mean, it's certainly very possible. I would not personally want to really get into that business again. I think it's low value for clients. So charging enough to really be able to learn the system, dig in, understand the source code, that kind of stuff I think is a big undertaking.

Ole Gjerde [00:07:58]:

So from that standpoint and for msps, I think every MSP has a different approach to it. Some people make you do a bunch of projects up front to get your network up to decent standard, some people just onboard you and deal with all this stuff. Comes. I'm not sure there's a right or wrong, but taking over something somebody else built, it's not even about good or bad, right? I mean, because everybody has a different way of philosophy thinking about how something is going to work. That doesn't mean that they were wrong. But if your philosophy is different now, it's going to. There's going to be a lot of friction there. And unfortunately the old provider is already gone.

Ole Gjerde [00:08:30]:

You will end up with that friction. And so how do you have a good process in the system to handle that friction, to get it to a point where you do understand what they're doing and that kind of stuff? So yeah, I mean, both for an MSP and doing like custom software development, taking over other people's systems, I think it's challenging. We did it. I mean, it can be done. We take, you know, I'm sure you run into this too. Somebody else does a business central or CRM implementation will take it over. Has its own set of challenges, right? I mean, everybody, you know, sets it up different ways. Some people do a lot more customizations now, you know, so that it breaks, it upgrades.

Ole Gjerde [00:09:04]:

So pretty much no matter what business you have, you have some form of this. But building the expertise to do that really well, I think is challenging. And MSP is rendered a lot because for Dynamics, there's only so much, right? There's only so many pieces you have to worry about msp. It is everything. Like literally there's nothing in a network that cameras, you name it. And you have to, at least at some level understand everything in a network. And I think that's after 20 some years. I'm pretty happy to be done with full MSP because I think it's actually a really tough business.

Neil Benson [00:09:37]:

So for all of those Microsoft partners out there who aren't MSPs today, who may be Azure partners, business apps partners, what are the signals that they actually need an MSP in their life? What point do you think it makes sense to outsource all of your non core technologies so you can focus on the parts of your business that really deliver value to your customers early and often?

Ole Gjerde [00:09:56]:

I mean, you know, so it's been really interesting. So, so we split out to 2021. So it's about four years ago. And so I went from being in MSP for 20 some years to now in the last three years or so I'm a client of MSPS, which is really fascinating because I have a very different and I think unique perspective now that I never had before. I actually, you know, we never really understood the clients and the pain they went through. If I'm going to be super honest with myself, especially now that I've learned how what it is like as an end client, it is, it is really interesting.

Neil Benson [00:10:32]:

The shoe is on the other foot now. You can see from their point of.

Ole Gjerde [00:10:36]:

View, it is really interesting. Now I'm also a bad client because I know it too much, which is not like I know I can be kind of annoying, but part of it is I know what it could be, right? What should security be? What things like obviously five token session, token hijacking, all that kind of stuff. I know these things exist and I would like to be protected again but most MSPs aren't necessarily really great at these things. But honestly I think it's early and often pretty much if it, you know, this comes back to my focus kind of comment. Business is partially about focus. You know, where are you trying to get to, what's your strategy, what's your plan? And then it disposes on the execution. There's not a lot of secrets in business. I mean there's no magic sauce that somebody figured out it's putting all these pieces together.

Ole Gjerde [00:11:17]:

But I do think a lot of that is focused on especially us, you know, historically nerdy people. We loved doing all this stuff. We'd still set up users, we'll still do all this other stuff. And it took me a long time to kind of, and my other leadership team to kind of untrain me like no, just leave that stuff alone. Let, let, let the experts handle it. You're way more worth, you know, doing the other things than you are doing that kind of stuff. So, you know, I think the question everybody has to ask themselves is, okay, so if you could take the time you're spending on doing this stuff that is relatively low value and apply that to vision, strategy, execution, sales, process, whatever it is that you need, how much faster can you grow your business? How further ahead can you get? But it's a hard change because, I mean, it took me a long time to figure that out.

Neil Benson [00:12:02]:

I had an initial call with a potential MSP last week and they were asking me how much time I spent supporting our laptops. I was like, well, touchwood. But we've never had an issue with any of the hardware. We've got 30 people, we've probably had 40 laptops in that time and we're all good. And then of course, I walk into meeting with him yesterday and deep to one of our consultants, like, oh, my wifi card's playing up. It's like, oh, no, I'm going to have to do a warranty call with Dell. Yeah, it's just not stuff I should be messing around with. So absolutely, get some focus, Let somebody else deal with, put their expertise to use in looking after our hardware.

Neil Benson [00:12:35]:

The message is clear. Outsource the technology support as soon as you can to an expert msp. In terms of finding one, should I be looking for somebody who's much bigger than us, who's got a broad range of Services, who's ISO 27001, who maybe provide a premium service that's going to last us for many years as we grow? Should I be looking for a smaller one, who's maybe less expensive, provides a narrower range of service? How do you find the right sweet spot in terms of a managed services partner who's going to be a perfect marriage for you?

Ole Gjerde [00:13:08]:

That's a really interesting question. And honestly, this is probably applicable to any business. I think the most important is you have to understand what you're looking. And it took me, took me some tough time to figure this out because I know too much, right? So I kind of started like, well, I don't like Connectwise, so really they should use, you know, Ninja or whatever.

Neil Benson [00:13:26]:

This is in terms of ticketing or monitoring or. I've heard of Connectwise, but I'm not exactly familiar with it.

Ole Gjerde [00:13:31]:

So Connectwise is both a PSA and then they also have their Automate, which is or connectwise, rmm, whatever it's called now. So it's like monitoring, patch management, all that kind of fun stuff. So I was getting mired in like tools and that kind of stuff. And then I kind of got the point where it's like, why do I even care about the tools? I actually don't care what, what tools they use. And because it's true for most business people get really stuck on tools and like they get one tool and like, well, it's not perfect. Maybe I should look at this other tool. MSPs have this kind of disease and we did it many times. So I'm not casting the stones very far.

Ole Gjerde [00:14:00]:

The tools are just tools and you kind of get out of them whatever you put in. Now there's some that are better than others. That's true. However, you almost always better off committing to the best thing you can find and then you just commit to it and you make it work. And, and so for me it's all about the outcomes. So I think small and big I don't think is not necessarily that important. Operational maturity would be one of them. Right.

Ole Gjerde [00:14:22]:

Do you have high expectations for how mature they as a company having systems consistency, things like that? Do you really value help desk versus security compliance? Obviously be part of that. So my biggest thing is security. We're a fully remote company. So that means the laptops are either in somebody's house or a Starbucks or in a hotel. And so it is 100% of the time in a hostile environment. I mean our houses is probably the worst environment because you never know. Like it's, it's a little scary actually.

Neil Benson [00:14:50]:

You scare me now. You're scaring me. Holy. I just set up a new network last night.

Ole Gjerde [00:14:54]:

It's. Well, you should be a little scary because security to me is one of those things is how do you truly lock down a laptop that's always essentially in a hostile environment. And so you want to find an MSP that solves those problems that you're looking for. Have they done it before? Have they worked with similar businesses? Not necessarily the same business, but like, you know, professional services organization like ours that they used to people being remote. They're used to people needing, you know, to travel and it always is working and that kind of stuff and really just make a list of all the requirements you have from a business standpoint and obviously interviewing and talking to that. The problem is that most MSPs will tell you that they do it all. I wish I had an easy answer for how to really determine it, but I think it's getting, you know, like how they approach those things, how they talk about it. Do they seem to have a Clear process in the system.

Ole Gjerde [00:15:49]:

What does the onboarding look like when they onboard you? What are the problems that they typically see that you're running into? Because no matter what you onboard, there's going to be problems. And if they're not going to, if they tell you everything is amazing and perfect, well, they're probably not going to be very honest. And so MSP is tricky because every MSP is different. They all approach things differently. They use a totally different technology stack. They all focuses on various parts. Some are good at some things, some are good at other things. So I think it boils down to what's the most important things you want the most amazing help desk.

Ole Gjerde [00:16:17]:

Like for us, we don't really use a help desk very often because we have consultants. They typically, you know, I'm sure you run to similar thing. So help desk is not, you know, we need it, but it's not really that valuable. For me, it's more about that security, data governance and eventually getting to compliance. You know, being in the U.S. you know, we'd like to do our SOC 2 at some point next 12 months we'll need an MSP that, well, can support that, right? Not necessarily do the SOC2 compliance, but do all the things that they do to be the base for SOC2 to be able to pass it. And if they can't do that, they would be the wrong MSP. So for like you, if ISO 2701 is one of the things you're going to want to find one that at least has worked with clients that requires that kind of compliance because at least, you know, they should be pretty good because, well, that one's Even harder than SoC2 to pass, I'm pretty sure.

Neil Benson [00:17:09]:

So, okay, so yeah, the one I'm speaking to, they support a lot of financial services customers and we build business applications typically for financial services customers. So I'm thinking there's a lot of overlap there. And the kind of those entities are all regulated by a regulator called APRA here. So I figure if we're up at the same standards, then when a customer asks us about security, we can say, look, we comply with the apparatus regulations and Our MSP is ISO 27001 and their customers are all, you know, your peers in your industry. So that'll give us hopefully some assurance that we're on the right track.

Ole Gjerde [00:17:43]:

I think that's a good approach. I mean, you know, it's another variable that'd be hard for, you know, a basic MSP that doesn't have the experience to, to really, you know, convince you that they know what they're doing when they can't even speak to the thing. So, yeah, I think that's a good approach.

Neil Benson [00:17:56]:

And then the other killer question for my team is my developer laptop is going to get locked on. Am I going to lose admin privileges and. Well, we're going to have to find the right balance here because I have seen not a business apps partner, but a SharePoint partner put out of business because a laptop was lost and then found to have a complete list of blood donors on it. They were working for a blood donation bank. And, yeah, the business got put out of business. So I want Purview or something else to let me know as soon as there's a big list of customers on somebody's hardware, because we should not be taking customers data off their network.

Ole Gjerde [00:18:33]:

Well, that too. But you know what happens. And so for us, it's making sure every single laptop is fully bitlockered, for example, because, you know, it's got to be encrypted. That is, I mean, pretty much any compliance framework is going to require that. And so, you know, I wouldn't say we're great yet, but I think we're making good strides in actually providing it. Purview would be the next kind of evolution, actually using data governance, actually tagging documents so that the system, you know, Azure will actually, you know, protect all those things is 99% of MSPs don't even touch that at all. So that's a very. I have yet to find somebody that actually that's affordable.

Ole Gjerde [00:19:11]:

I know the big, you know, Accenture and the big consulting companies absolutely do it, but you're spending crazy money that we just can't afford to do. So I think there's actually a market here for somebody that would start a business that does things like this, but for SMB, because every SMB should have this. But it's got to be made way easier because that's actually the big problem. I actually think it's possible to do it relatively affordable. I have enough on my plate, so I don't think I'm going to go through that business right now.

Neil Benson [00:19:36]:

Focus, Ollie, focus. I think you're right. I think with AI, you know, you talked about tagging documents. I think AI can now determine the type of content of a document or a file pretty easily and probably suggest the sensitivity of the content. Those things should be easier, more accessible to SMBs. In the future. We'll see how that goes.

Ole Gjerde [00:19:54]:

Yeah, couple three years. I think it's going to Be pretty, pretty easy. But it's still. Everybody talks about AI taking over the world tomorrow and I'm not too worried about it's going to happen tomorrow because it's still not very smart. There's glimmers of coolness and things that are kind of incredible. And then you ask it super basic questions that any human would answer and it basically knows nothing. So I'm like, yeah, I think we got some time.

Neil Benson [00:20:17]:

Yeah. Let's move on to the original topic of our conversation, which is about adding managed services to. To a practice that, you know, in our case it's business applications development. It could be Azure development or whatever. But what are the things to look out for when it comes to providing a support service for, for your customers? What should I know before getting into this?

Ole Gjerde [00:20:36]:

Well, it's an interesting question, you know, and I think most dynamics, you know, or business applications, we can, you know, whether it's netsuite, it doesn't matter. We'll do with some element of support. Right. You know, when clients have issues supporting them and all that kind of stuff. And you know, we have years, you know, right now we're about 35 people, you know, we, I would expect we will continue growing about 20% year over year for the, you know, or potentially more over the next couple three years. And you know, currently support is kind of done by the team as a whole. We don't have a dedicated support team. I already know the next evolution of making support and application management amazing is to have a dedicated team that this is what they do.

Ole Gjerde [00:21:14]:

They have systems that processes to have like everything set up to actually create amazing support and actually manage stuff properly. And we do elements of it. We don't currently probably, you know. No, we definitely don't have it what I call a cohesive setup. The problem is how do you get critical mass to be able to afford to do it?

Neil Benson [00:21:33]:

That's exactly our conundrum.

Ole Gjerde [00:21:35]:

Yeah. You know, until you have enough recurring revenue to actually pay for it. So how do you get started? You know, for us, we're kind of in the middle of this too. Right. We do the support, we do some of the management, but not as like a true managed services and kind of. So in that specific case, we're probably in the same boat as you. We know we need to do it. This is the next evolution.

Ole Gjerde [00:21:55]:

I've always think that when we acquired this company in 2018, you know, I didn't know that much about the consulting word and business applications and it's been quite the learning experience. But honestly, one of the things I learned is it's a terrible business. It's actually terrible for clients. If you look at all the big consulting companies, they are driven to charge as much money as humanly possible and not worry as much about creating value for the client. Well, that's actually a terrible dichotomy between vendor and client. So one of my driver over the last couple, three years particularly has been how do we change this? How do we create this to be truly a win win with our clients? Because I want partnerships, I don't want clients necessarily. I want this. We're just humans working together, solving problems, right? So we have expertise, you know, they have their expertise, but they need our help.

Ole Gjerde [00:22:41]:

How do we work with them to solve those problems? So even into things like being super transparent with your clients, a lot of consulting companies kind of like if they make a mistake, they'll be like, ah, you know, don't worry about this. Like, you know, as humans, don't most of us just want to work with other good humans? And so my big thing is kind of holistically, how do we change this business, at least for us, or maybe set an example of what can be. And I know, you know, I did a little bit of research on your. You have a couple of different businesses and I love everything that you're talking about on website and how you're approaching it because it sounds like you have a very similar kind of approach. How do we change this? How do we not just make this building an hour here and there and just make lots of money? Let's create true win wins, let's find ways to change the way we work. And the managed application space is just yet another one of those pieces to me. But it really goes into a big thing because you add some business intelligence, you add some data governance. I mean, we touch some of these pieces, you know, training, you know, so it's not just about training one time, but it's how do you really enable a user to use business application? Right.

Ole Gjerde [00:23:48]:

They're investing a ton of money into it. How do they really use it? How do they actually get to feel where, wow, this is making my life easier? This is actually making my job easier. Which. How many people say that about software? Not very many people. Can it be done? Yes. Is it easy? No, it is. I'm not going to say we've got it figured out, but I do think it's something that we're focused on. So I think for the managing application, you know, I wish I could give you the answer.

Ole Gjerde [00:24:12]:

Because we're kind of in that same journey of figuring it out. But you know, since the day we acquired it, I've always known this is something we're going to do at some point. Because fixed fee has a lot, you know, fixed fee for or all inclusive depending on how what part of it you're looking at is part of the element that you need for truly a win for the client. So they have certainty what is the value that they're getting and how much money are they spending for it. Because if you can't give them those two things, well now it's always stacked in the vendor's favor. I don't think that makes a good relationship. And so yeah, there's no easy answers. I know there's some people doing it, most of them are doing it for smaller customers.

Ole Gjerde [00:24:50]:

I guess I'd be curious as your client size, but we do everything from relatively small businesses into maybe they have a couple, three licenses of Dynamics all the way up into enterprise. Well, mid market enterprise. Doing truly managed services for applications is a big risk for a small company.

Neil Benson [00:25:08]:

Well, that's the boat we're in. Most of our customers are much bigger than us. They're hundreds of people. Mid market and enterprise government financial services. There's certainly a risk there. We're taking on very complex, not just applications, but portfolios of applications and their integrations and all the baggage mostly that we've built. So we know, you know, we know the systems pretty well. But the day will come when we're taking on a system that we haven't built.

Neil Benson [00:25:31]:

You at least have got years of experience of setting up the processes and the systems and the PSA and whatever else you need to run a support practice. I've dabbled in that stuff in the past. So we're coming into that a little bit fresh. We are going to probably hire a service delivery consultant or somebody just help us set up all the policies and procedures and fine tune our system to make sure that it's capable of providing support. You touched a couple of times on, on pricing or value exchange. How do you make sure it's set up fairly for both parties? And that's something I'm really curious about because the models that we've put in place in the past have varied widely. One we had was because we're supporting a membership application. We don't price it based on number of users but on the number of members inside it.

Neil Benson [00:26:15]:

So as their membership organization grows then the support fee would increase right in line with their business growth. And if it shrinks, well, our fees would shrink as well. There's all sorts of different metrics and ways of charging. Do you think there's a perfect way or a model that True north would consider whenever it offers this more mature managed support business?

Ole Gjerde [00:26:35]:

You know, I don't know there's a right or wrong answer for that. You know, some of this is risk management, because that's part of the challenges. You know, it's the inclusion, the exclusions. MSPs run into this too. So anytime you do anything, managed services, where it's one price for something, almost no matter how closely you document that, there's going to create a lot of friction with clients. And that's always my biggest concern. So if you think about customer experience, getting rid of friction is one of those things. Billing is easily, it's by far the biggest friction between consultancies and clients.

Ole Gjerde [00:27:09]:

Because there is no magic way to do billing in a way that clients love. Nobody loves writing big checks. No, I think there's a lot of options. You know, I think our next evolution for us is actually to create options for clients. And so because I also like the idea of empowering people. Usually when people are empowered to make their own decisions, they may not be happy, but they're at least less unhappy. So, you know, it's the fast, cheap and good. You know, pick two out of the three kind of same basic idea.

Ole Gjerde [00:27:40]:

So, you know, everything from, you know, obviously not so much on the managed side, but even thinking of implementations and all this kind of stuff, everything from obviously just pure time materials. Some clients just wants to pay you as they go. Some people want to do by milestone. So actually the client actually gets something for a certain amount of money. Everything from more like consistent billing and you do it more of an agile sprint. And we've done all of the varieties over some period of time. Because some clients is government, for example, they just have certain requirements. It doesn't matter what you do, you're doing it this way whether you like it or not.

Ole Gjerde [00:28:14]:

And so I think what we figured out is we've, we've kind of tried every different way of doing it. And I'm like, why can't we pretty much offer not all, but at least a lot of the major things the clients can choose what's important to them, if they would rather have a very consistent bill every single month, then a delivery goes a little bit up and down, or whether they want consistent deliverables and that kind of stuff. I mean, there's no reason we can't accommodate Most of those things. And so, like, looking forward to, like, manage applications is, you know, what are all those inclusions? How do we manage our risk? What is the likely load? And it's like the insurance model, right? You lose a little bit money on few, you'll make a bunch on money on both. But how do we get started on that? So in our case, we're starting small with specific parts of it and then we're going to see what works and what doesn't. Because the problem is you go and make the perfect packaging or product. Is that what client wants? There's only one way to find out, which is to go try to sell it.

Neil Benson [00:29:08]:

I understand what you're saying about giving customers options. It just breeds a lot of complexity in your business and in your billing system and in your contracts. And I remember when I first launched a hosted CRM company back in 2006, I can't remember how much we charged. £50, it's back in the UK. So £50 per user, per month, it was all inclusive. That included your Microsoft CRM license, the hosting cost to support operations and everything else. And then my sales team would go back and go, oh, I've got this customer and they've already got the license, so we just need to strip that out of the £50. And this one over here, they don't want support or they just want support.

Neil Benson [00:29:41]:

You've got to strip that out, unbundle it. And suddenly our price list went from one thing to seven things and every customer's got a different combination of the seven things. And it just is a lot more complicated.

Ole Gjerde [00:29:52]:

It is. But I think for us, I'm willing to take on the internal operational complexity because it does allow us to. Now, I know there's two different business philosophies here. Some people are like, simplified to poo, to perfection, which is a great way to do a business. I think the challenge is you are going to become fairly narrow, right? You're going to create a kind of a very clear target market. There's plenty of people that say that's a good thing. You know, I'm going to try the opposite. Not to be everything to everyone, because you can't, but how do you create the illusion of significant options? It's just not quite as much as it comes across.

Ole Gjerde [00:30:31]:

Our basic process is still the same. The way we project manage, the way we approach the project, we approach walking through the client with specification gathering, all that stuff is identical. So for me, I'm separating the work that we do and the billing Mechanism because the billing mechanism is most of the friction. Well, let's figure out how to just make this just not an issue and we'll see. You know, we're probably about halfway through that. I get, you know, by the end of the year I think I'll know like, is this going to work and how much complex will it make our business? I think it's going to be limited because it's primarily going to be a little bit in the sales process because obviously they need to be able to understand the different options. A little bit on the billing side, but that can most be automated and a little bit on the project management side. But again it's pretty minimal because their basic steps are all the same.

Ole Gjerde [00:31:18]:

They may provide slightly different information throughout the thing. So for me that's a reasonable increase in operational complexity, but limiting client friction and meeting the client a little bit more where they are. And so will it be successful? Yeah, it'll work. There'll be problems. We'll tweak it as we go.

Neil Benson [00:31:36]:

Yeah, well, I mean it allows you to say yes to more prospective customers. Right. If they insist on a certain value exchange or billing mechanism or whatever, you can say, yep, we can accommodate that.

Ole Gjerde [00:31:45]:

And as we grow, I think the complexity can be split up. No different than if you have an MSP like full MSP in a Dynamics company. One, if you're big enough they can kind of run semi independent and again, depending on some of the complexities and where they lie. I think long term there's a way we can get rid of it. But again, between automation systems and some AI, a lot of that can be automated. And so that's partly why now is the right time to do some of these complexer things because there's a lot more options now than we're back in the day back. You have to write a bunch of code to do all this crazy stuff. No thanks, we don't have time for that.

Ole Gjerde [00:32:20]:

So I think that just time is right to meet the clients where they need us to be instead of forcing them to always do it our way.

Neil Benson [00:32:28]:

As I think about the developers in our business, I'm going to end up with three different types of Microsoft developer. One is a consultant who's billable on projects doing great customer work. Their goal is to remain highly utilized doing interesting work, solving difficult problems. We've got product developers who are building ISV products on the Microsoft platform for us and I try not to spill them over into doing consulting work. Right. They fill in a timesheet, but it's just doing product development. They're never consulting for customers and so that just allows them to focus on product development. Now I'm going to have a new class of developer who's a support developer who sit somewhere in the middle.

Neil Benson [00:33:08]:

They're going to be supporting our products. They're going to be solving problems for our customers that our customers have raised. I'm trying to keep them dry. I'm trying not to get them on timesheets where they're doing consulting work. And I'm trying. What do they do when they're not handling a support issue? Do I get them doing product development? How do I keep them productive and doing meaningful work when there's no support tickets? And let's, you know, I hope there's not enough support tickets. So if there's too many support tickets then we're all employees in bother. But yeah, how do you think about allocating people efficiently across your parts, your business like that?

Ole Gjerde [00:33:39]:

Oh, this is a conversation we've had many times and you know, so our companies are about the same size, so we're running into the same issue where we're not quite big enough to have truly dedicated people. But the overlap sucks. Right? You know, if you're, if you're a consultant working on a project, getting interrupted all the time by being, you know, doing tickets is bad for everyone. It's bad for the client, it's bad for consultant. You know, I think short term there is no super easy answer. I think for me is, you know, what we're working right now is how do we grow the business to a point where we can have the separation now, the part that we have. So I think our businesses are extremely similar. So I think our product people are highly focused.

Ole Gjerde [00:34:18]:

They only work on IP based products. That to me is truly the future of, you know, obviously making a lot more money is disconnecting hours of dollars. We don't need to hire a bunch of people necessarily. Support, yeah, we're running in the same issue. You know, there's, we have people that are like primarily support and people that are primarily consultants and then there's a little bit of overlap. So every quarter we're just trying to minimize it more and more and more and I think we're getting it to be much better. But I think the next evolution is to truly have a separate support department. All they do is support.

Ole Gjerde [00:34:52]:

You know, how do you keep them busy? I mean ideally we have it lined up enough that the resourcing matches the revenue that's coming in. And if they're not necessarily busy, you know, it's not the end of the world. And you know, you can give them pet projects, you know, whether it's research or playing around with AI, you know, agentic kind of stuff. Because I think about support people tend to be more of the junior ones. So how do we give them opportunities to expand their skill sets and hopefully eventually, if they want, move into more of a full consulting role? That's where we want to get to. We're in the middle of figuring that out right now. I would expect that we'll be able to separate the support environment maybe late this year, but probably realistically sometime in the first half of next year. And that's going to be the magic because now you can have way more consistent support.

Ole Gjerde [00:35:37]:

You can have, you know, managing SLAs and all that stuff is 10 times easier because you know exactly what resources you have and what needs to be done. And you don't have to steal from consulting to do it. But in the meantime, we just do the best we can. Unless somebody's going to give you a bunch of money to do it the right way, right up front. I think that's probably the only way to do it is to do it messily. But supporting our people the best we can, minimizing the distractions as much as we can. I don't know if there's a better answer at this point.

Neil Benson [00:36:07]:

Have you ever had a customer yet? They've got a business central deployment and it's mission critical. And it's like we need 247 support or we need weekend coverage. How do you handle those kind of requests when you're this kind of size? That's another conundrum we're stuck with.

Ole Gjerde [00:36:23]:

So I don't know that we've ever actually been. Okay, we've been asked, don't get me wrong, but we don't offer 24 7. We try not to do much on call and that kind of stuff. I mean, are people already busy enough? So one of my big things is how do we balance the work and their home life and all that kind of stuff. It just has been an issue for us. I'm sure we'll run into at some point. For me, probably the easiest way to solve that, if a client came and demanded it, and it would be worth it would be to try to set up a partnership with somebody else. Right.

Ole Gjerde [00:36:53]:

You know, one of the beauties of the world nowadays is where where you are really isn't that important. And so, you know, and most of the bigger Companies like, you know, PAX8 or other ones, you know, they have people in the uk, they have people in Australia and really be able to handle any time zone. One day I hope to get to that point where we can grow to that size. In the meantime, unless it's a client that we couldn't say no to, honestly, I'd probably just say no because just like with support, that's an even bigger jump from the 8 to 5 or whatever. To do 24. 7 support as an MSB, we did have it. We did a rotation with the technicians where they had a. Well, originally a pager and then obviously, you know, a cell phone that was handed around.

Ole Gjerde [00:37:37]:

It does really suck for the employees. Right. So it's something I don't. I'm trying to avoid it as long as humanly possible because even though consultants will do it, it sucks. No, nobody likes doing. You know, you're in the middle of supper with kids and you have to take a call. It's just so luckily we've been able to avoid that. But beyond that, I would probably recommend looking at potentially like a partnership where somebody, you know, an organization in a different time zone can handle those other ones because then at least you don't have the cost all the time.

Neil Benson [00:38:05]:

Yeah. I remember chatting with one of my customers and she said, you know, if we needed 24 by 7 support, obviously you'd have to have three people so you could rotate eight hour shifts. I'm like, no, you need. I remember at Rackspace when they wanted another 24 by 7 pod, I think it was eight or nine people to cover all the time zones, the holidays, the weekends. It's not a simple case of split 24 into three eight hour shifts. You need a lot of people. It's very expensive. Yeah, Yeah.

Ole Gjerde [00:38:33]:

I mean, it's same as, you know, MSPs. A lot of MSPs dream of building their own SOC. Right. For security. But again, it's the same problem. You need so many more people that the cost. So if you're not a company of scale, I don't know that it's possible. So you have to do things like you put people on call.

Ole Gjerde [00:38:50]:

But then my question is, okay, so let's say, you know, expert consultants have it. Are they going to answer the phone at 1:00am, 2:00am? I mean, I don't know. Historically it works sometimes. Well, I don't like promising our clients that we're going to provide 24. 7 support and then we fall down when they have a need. Right. I mean, I'd rather disappoint them up front to say we just we don't offer 247 support because currently we don't. And so far it's never been a deal breaker.

Ole Gjerde [00:39:15]:

So I think a lot of clients want it but then when they're told usually how much it costs to have that kind of thing, they're like eh, it's probably not a big deal. And you know, I think for most organizations they're not operating 247 so I think it's pretty rare that they really.

Neil Benson [00:39:29]:

Needed well, it's been a fascinating conversation. You've helped me clarify a lot of certainly going and finding an msp. We've got a lot of clarity there. I think building our own MSP business there remains some open questions. But yeah, you've given me lots to think about and I really appreciate your advice. Thanks so much for joining us.

Ole Gjerde [00:39:46]:

Yeah, thanks for having me. And I guess the one thing I would say is maybe don't call MSP because I think most people would assume you're going to get into like IT services. And I like the other term used manage application services because you know, I think that is the next evolution of anyone that does consulting in the business application space. And we're here for it too and we'll figure it out together because you know, like sharing is caring and we all have similar challenges to work through and the best way to do it is to do it together.

Neil Benson [00:40:13]:

Awesome. Really appreciate it. I'll let you know how we get on. I'll share the story with you in a few months time and you can see where we got to.

Neil Benson [00:40:21]:

Thanks Oli Jordy from True north for joining me on practice leading. You'll find links to Ollie's LinkedIn profile and to the TrueNorth website in the episode description. One thing he shared with me after we wrapped up was that TrueNorth still partners with a lot of MSPs to offer business applications to to his MSPs partners customers. And Ole loves paying out referral fees to his partners. So if you run an MSP business in the US that sounds like a good deal to you, you need to contact Olle pronto. Here are my key takeaways from our conversation today. Number one Focus is everything. Ollie stressed the importance of keeping business lines like managed IT services and business app development separate.

Neil Benson [00:41:05]:

Unless you're truly large enough to have dedicated teams and separate leadership, spreading your focus too thin can lead to operational headaches and stunted growth. Number two was onboarding customers and their baggage into your support practice. It's tough no matter how you try and do it. Taking over systems built by someone else is inherently challenging. Whether it's a full MSP business or or your support is just limited to something like business applications, you need to invest in strong onboarding processes to manage the friction as you inherit the skeletons in somebody else's closet. And number three, designing Win Win support models really matters. Ole's opinion is there's no one size fits all pricing or delivery approach, and he shared how empowering your customers with options while trying to manage your own complexity helps build healthier, longer term partnerships. Just be wary of overcomplicating your own operations along the way.

Neil Benson [00:42:04]:

A fine balancing act that I'm sure.

Neil Benson [00:42:06]:

We'Re all trying to navigate as we grow.

Neil Benson [00:42:08]:

Hope you enjoyed our conversation today and found it useful. I look forward to catching up with you next time. Until then, keep experimenting.

Areti Iles [00:42:15]:

I hope you enjoyed this episode of Practice Leading and found it just as inspiring as I did. Who would you like to hear from on a future episode? What leadership topic would you like to learn more about to help you scale your Microsoft practice? Send me a LinkedIn message and let me know. Your feedback helps me create the show that you find most useful. Until then, keep experimenting.