Have you been played?

Screen Shot 2014-01-25 at 9.02.39.png

Yesterday I met with a good friend of mine who manages operations for a small professional services company. After catching up on life and family and other personal topics, she shared with me that she's reached a point of frustration with their IT service and she wanted my advice on a problem she's dealing with.

She told me that they have an IT service firm that promised them a low monthly fixed service fee. The IT firm told her that with their 24/7 remote monitoring and unlimited help desk support, their low fixed service contract would help keep IT costs under control. So I asked her how it's working out for her. She explained that she's concerned about their backup system after receiving a call from a tech at the IT provider telling her the backup is full and needs to be replaced now. She said he wanted her to buy a cloud backup service because it's great and it's what they use on all their clients.  This for her was the first warning sign.  She didn't know why, but something felt wrong about the conversation.

She went on to tell me how their service plan works:  The IT company takes unlimited calls when they have problems, and if the problem can't be corrected over the phone, a tech will come out to them at a discounted rate. And phone support sometimes takes a day or longer to complete. I asked her if the charges for on-site service were all she's paying for above and beyond the monthly fee (which happens to be $1000 per month). That's when she became noticeably upset and pulled invoices to share with me charges she doesn't understand for "cloud" and "remote access and monitoring software-as-a-service".  It wasn't the fee- just a little under $500.  It was that she didn't understand it. And the owners of the IT company hadn't paid a visit to her in over a year.

So we sat down for 30 minutes during which I asked her about a dozen questions about her business. As she answered each question I took notes and sketched on my note pad.  At the end I turned the notes around and showed her what her business looked like, where the paid points are - her employees' problems, the waiting time to get them corrected, and the downtime that costs the business billable time - and where the big risks are - that their backup is incomplete and how long it would take to restore their business on the Amazon backup that was pitched to her (3-4 days). When I explained that their Internet connection would have to be increased to make restore faster, she exclaimed "that's what they told me!  They wanted to sell me a bigger Internet connection too!".

On the same sketch I showed her some alternatives that make more sense for their business. From what she shared with me about 90% of their problems are the same problems every month and every quarter, and are only being dealt with at the symptom level.  I suggested that she have two onsite visits of 2-4 hours each per month to get the problems' root causes identified, solutions worked out, and the problems completely resolved.  One networking issue was actually a device in their closet that is known for a particular bug, but the techs had focused on solving the secondary symptom at the user's computer for over 18 months, leaving the cause of the problem like a ticking time bomb until the next panicked call. I also suggested a standard 3-week rotational backup system, including getting their data off-site in case of a complete loss like a fire or theft of the server.  Or worse yet, if the owner's computer fails, it isn't being backed up. She told me that their IT service said he works off the server so he doesn't need to be backed up.  I asked her how long it would take to put a new machine together in a way he likes.  She only responded with a look of combined frustration and understanding.

I shared three red flags with her, as well as the top five things she should expect from an optimal IT service for her business:

  • Be cautious of "fixed fee" promises. Anyone can have a fixed fee by limiting their service. Promises of "low monthly fixed fees" are just marketing gimmicks designed to play on the pain small businesses feel from consultants and other firms that prey on billable hours. It's better to have an agreement to manage the budget to the customer's desired expense, together with a promise to advise them on what additional work or resources are needed, regardless of the budget.  The business owner should have the right and privilege to understand the expense and decide whether or not it's important enough to pay for. This brings me to point #2:
  • Be careful of service plans that market "unlimited" help desk. Help desks are by definition designed to triage symptoms or provide quick fixes. Help desks don't and can't address your system. You should still expect 100% of calls get priority attention.  That's a given, but the call is just a step in the process, but by itself can be ineffective and leave root causes to create a perpetual need for the help desk.  It may seem less expensive (which is where the marketing gimmicks originate) but think of the time you're bleeding out over and over again.
  • Be cautious of reseller models. Most techs and service providers "resell" cloud services. Some examples including Microsoft 365 licensing, Google Apps for Business, Box.com and countless others.  Sometimes the bill will say "Software-as-a-Service" or SaaS. It's not that these are bad. Almost all of them are great services.  The problem is that product is like a drug for a tech or IT service provider. All of these services come with about a 20% margin to the service provider. That's a conflict of interests for an IT provider who is supposed to ensure you're always in the right service.  My company, TechRoom, is a Google Apps partner so we can have the tools and support we require to help migrate customers to Google Apps if it's right for them, but we have a standard process of spinning customers off to "direct bill" within the first month following migration.  

The solution for a small business needing their IT system to always be up and running is really simple on the surface, and very difficult to deliver on for the IT provider:

  1. They need to know what's important to the business owner. This usually boils down to "no problems, no downtime".
  2. They need to go onsite consistently (as part of the device) to confirm and make sure things are working and won't stop working.  Is the hard drive getting full?  Are updates applied?  Is anything out of alignment that can be detected before it reaches a crisis?
  3. They need to check in with everyone, employees and owners, regularly.  They are the only ones qualified to tell you if everything is really working or not.  Their perception is reality, regardless of what a tech says the system looks like.
  4. They need to think and do their homework.  For example, the principles of a backup and restore system are always the same, but every customer has a specific set of business requirements. The backup and restore plan must be tailored to the business operating requirements, not a set of products (e.g. cloud) for resale. There are no shortcuts in service.
  5. They need to know the business they're really in.  They call themselves a service provider, but are they really a reseller that happens to deliver products via service and are just confused?

I'm pleased that my company TechRoom will be taking on the responsibility of IT for my friend and her company, and I will be personally responsible to her and her boss to make sure they're satisfied.  If you are looking for more information about how a real IT service can give you more time back and help your business be more profitable, please contact me.  I provide consultations to business owners as a courtesy and I have helped hundreds of small business owners understand how to keep control of their technology and get the results they want.