Though the cloud represents more competition in a crowded space, there are immediate opportunities for ITSPs to increase their profitability.

Examine how you use automation before expecting results.

Mellor makes a great point:  Buying automated tools and expecting increases in gross margin gains and productivity isn’t realistic.

He knows this from experience:

The reason behind the lack of productivity and gross margin gains had nothing to do with the tools, they had to do with the inability we had embracing the automated lifestyle. In other words, we never committed to automating out stupid repetitive tasks that were killing us and driving down our profitability.

The right tools don’t guarantee powerful benefits. The full value of automation comes from identifying costly, unproductive processes and automating them.

Profitable automation requires a shift in perspective.

The first steps to increasing gross margins with automation are examining processes, service delivery, and pinpointing tasks that decrease the profitability of services.

If automation is only applied to very specific parts of businesses and processes, the gains will be minimal. When automation is introduced across services and becomes part of problem solving, scaling, and process, its benefits compound across activities.

Complete adoption of automation drives business opportunities. 

ITSPs that automate have experience with its challenges and can better advise customers. Their ability to drive business outcomes can differentiate their managed services and create new opportunities.

Going forward, profitable managed services will take more than keeping up with external changes. Looking inward now will help you build processes that will help you grow within a changing industry.

#ProfitabilityAutomation will be the next step for ITSPs ready to transform their businesses.

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