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Do you have a clear idea how you want to grow your IT service business?  There are so many service paths and potential offerings that many IT companies spread themselves too thin. This usually results in confused clients and employees and ultimately a loss in business momentum.

The ‘sweet spot’ in growing your business is finding the balance between adding value to clients by expanding to new service offerings combined with deeper penetration in service areas that you already offer. For example, if you already monitor servers and work stations and consult with clients to help them make strategic technology decisions, a new service you might think about introducing is reviewing clients’ telecommunications and bandwidth usage to analyze potential benefits of VoIP and a faster/cheaper Internet connection. This deepens your value to current clients and opens new opportunities for growth with new clients.

Another aspect of building value is upgrading prices to correspond with value. IT service providers that see the opportunity to price services based on value rather than merely on hours of labor are on a track to build a more leveraged, scaleable and valuable business.

As an IT service provider, you might spend 10 hours learning an important way to deploy technology with one client that results in a significant business benefit for all your clients. How much should you then charge the next 20 clients that you help achieve the same benefit with that learning?

Simply billing the next 20 clients for time spent at your standard billing rate completely diminishes your value to those clients. If you are a technical mechanic, charging a labor rate is fine.  If you are a business solution provider and a manager of systems infrastructure, your charges should be based on the value of your services and not on standard labor rates.  This also begs a discussion about how to set rates, price specific services, and when a service is to be included because it is the responsible thing to do.

To continue however, services only have value when they are perceived to be valuable to the client. Even if your services are priced rightand have huge dollar benefits to the client, if the client doesn’t see it the same way, your perception of the value is wrong – the client’s view is always right.

Keys to structuring new service offerings:

• Understand client perception of value – provide ongoing business benefits rather than one-time relief of pain and keep lines of communication open so that you know how they are seeing the value of your services
• Pricing – one size does not fit all, have internal guidelines on pricing but custom fit to each client’s circumstances
• Packaging – align marketing message with sales positioning, focus on ongoing business value
• Positioning – paint the picture so the client can see themselves leveraging the ongoing services you are proposing to provide
• Supporting – schedule time with clients whether something is wrong or not; this is key to ongoing communications and 2-way understanding

Example of services that provide ongoing value to businesses:

1. business reviews that set priorities for technology management
2. on-demand access to helpdesk services (specific to user technology needs)
3. hardware and software management (maintain uptime, licensing renewals, upload latest patches, eliminate problems and system down-time)
4. data protection and security packages (back ups, Internet usage monitoring, network security)
5. telecommunications management (bandwidth management, bill monitoring, phone system management)
6. systems capacity forecasting (predicting well ahead of time when machines are going to run out of capacity and helping to plan budgets for upgrades and replacements)
7. IT co-management service (giving client IT staff a way to work with your engineers to jointly solve problems and manage technology; giving the client online, realtime access to work plans, work accomplished, requests processed, tasks closed, etc.)

One of the easiest ways to start offering new or upgrading your existing service offerings is to run the offerings by existing, loyal clients. It is typical to have some existing clients who perceive a higher value in the new offering want to upgrade, but there might also be some clients who are so used to getting good value at the currently low price they won’t make a move.

The overall goal is to avoid approaching new clients without having tuned your positioning of new services with feedback from existing clients. This will make sure your positioning with new clients is organized, thought through and most importantly perceived as valuable by businesses.

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CoreConnex specializes in professional services automation (PSA) software for VARs, MSPs, channel distribution partners, IT service providers and other professional service companies. We encourage you to share experiences and perspectives as players in this professional community. This blog is moderated. Comments that are unprofessional or derogatory will not be posted.