Are you feeling frustrated with your Managed Service Provider (MSP)? You’re not alone. Many businesses face this challenge at some point. Before you make any drastic changes, it’s essential to understand the root causes of your dissatisfaction and explore all possible solutions. This guide provides a strategic approach to help you effectively maneuver around these challenges.

Understanding Why Your MSP is Underperforming

Blaming the MSP might seem easy when things go wrong, but the situation is often more complex. Several factors may contribute to their underperformance:

• Lack of Proactive Support and Monitoring: A top-tier MSP doesn’t just fix problems; they prevent them. If your MSP is reactive instead of proactive, this could indicate a misalignment with your needs or a gap in their expertise.

• Inadequate Security Measures: In the digital age, robust cybersecurity is non-negotiable. If your MSP isn’t implementing strong security protocols, your business could be at risk.

• Poor Communication and Responsiveness: Delays and poor communication can lead to unresolved issues and growing frustration. Effective MSPs prioritize transparency and consistent communication to ensure smooth operations.

• Limited Scalability and Flexibility: Your MSP should grow with your business. If they can’t adapt to your evolving needs, it might be time to reconsider the partnership.

• Insufficient Expertise and Resources: Your MSP needs the right skills, certifications, and resources to manage your IT environment effectively. If they lack these, performance will suffer.

Key Conversations to Have with Your MSP

Effective communication is key to resolving performance issues. Focus on these critical areas when addressing your concerns:

• Performance Metrics: Regularly reviewing performance metrics is critical to understanding how well your MSP is meeting expectations. Key Performance Indicators (KPIs) like response times, issue resolution rates, and system uptime are the foundation of this evaluation. These metrics are essential not just for accountability but also for continuous improvement. By analyzing these metrics, you can identify trends that might indicate underlying issues, such as recurring downtime or slow response times, and address them proactively. It's also important to benchmark these metrics against industry standards to ensure your MSP is not just meeting but exceeding average performance levels. Consistent underperformance in these areas should trigger a formal review process and could necessitate corrective actions or even contractual penalties as stipulated in your Service Level Agreements (SLAs).

• Service Level Agreements (SLAs): SLAs are the backbone of any service relationship, clearly defining the expectations and responsibilities of both parties. They should include specific, measurable goals such as uptime percentages, maximum allowable response times, and the processes for reporting and resolving issues. Regularly reviewing SLAs ensures that your MSP remains aligned with your business needs, especially as these needs evolve over time. If your organization undergoes changes—such as rapid growth, technological upgrades, or shifts in operational focus—your SLAs might need to be renegotiated to reflect these new realities. It’s also crucial to include clauses that address what happens if the MSP fails to meet the agreed-upon service levels, such as financial penalties or the right to terminate the contract.

• Feedback/ Improvement Plans: Creating a collaborative environment with your MSP is vital for continuous improvement. Regular feedback sessions should be scheduled where both parties can discuss what is working well and what areas need improvement. This feedback should be specific, constructive, and supported by data from your performance metrics and SLA reviews. From these discussions, actionable improvement plans should be developed. These plans should include clear objectives, timelines, and responsibilities. Regular follow-ups are essential to ensure that these improvement initiatives are being implemented effectively and that they are producing the desired outcomes. A culture of continuous feedback and improvement not only enhances performance but also strengthens the partnership between you and your MSP.

• Security Measures: Cybersecurity should always be a top priority in your discussions with your MSP. The increasing frequency and sophistication of cyber threats require that your MSP is vigilant and proactive in its security measures. Discuss how your MSP is addressing potential threats, including their strategies for risk mitigation, incident response, and compliance with industry standards like ISO 27001 or GDPR for European operations. Your MSP should also be able to demonstrate that they are using the latest security technologies and protocols, such as encryption, multi-factor authentication, and regular vulnerability assessments. Additionally, it’s important to ensure that they have a comprehensive disaster recovery plan in place that is regularly tested and updated. Regular security audits should be a part of your SLA to ensure ongoing compliance and protection.

• Scalability and Adaptability: Your MSP should be prepared to support your business growth and adapt to changes in technology and market demands. This means they should have a clear understanding of your growth projections and be able to scale their services accordingly, whether that means expanding infrastructure, increasing manpower, or integrating new technologies. Additionally, the MSP should stay ahead of technology trends and proactively suggest upgrades or new solutions that could benefit your organization. The goal is to ensure that your MSP evolves alongside your business, providing you with the flexibility to respond to new opportunities and challenges as they arise.

Leverage Your Contract to Manage MSP Performance

Your contract outlines the expectations, penalties, and procedures that govern your partnership. Here’s how to use it effectively:

• Termination Clause: Review the termination clause in your contract. This provides an exit strategy if your MSP’s performance doesn’t improve.

• Probationary Period: If possible, consider a probationary period where the MSP must address your concerns.

• Breach of Contract: If your MSP isn’t meeting agreed deliverables, they may be in breach of contract, which could allow you to withhold payment or enforce penalties.

Create an Action Plan for Improvement

If you choose to improve the relationship instead of terminating the contract, a structured action plan is essential:

Identify Specific Issues

• Detailed Assessment: Start by conducting a comprehensive review of the MSP's performance across all relevant areas so you can clearly outline where the MSP is falling short. This should include an analysis of key performance metrics (KPIs), service delivery timelines, issue resolution effectiveness, and customer feedback. Use historical data to identify patterns of underperformance and isolate specific areas where the MSP is not meeting expectations.

• Document Issues: Work closely with the MSP to find solutions. Document each issue clearly, including specific incidents where the MSP has fallen short. For example, if there have been repeated delays in resolving critical IT issues, detail the incidents, the impact on your operations, and any communication breakdowns that occurred. This documentation should be factual, based on data, and devoid of emotional language to keep the conversation focused on improvement.

• Categorize Issues: Once issues are identified, categorize them based on their severity and impact on your business. For instance, issues that directly affect business continuity (like system outages) should be prioritized over minor delays in non-critical areas. This categorization will help in prioritizing solutions during the collaboration phase.

Collaborate on Solutions

• Joint Problem-Solving Sessions: Schedule collaborative meetings with the MSP to discuss the identified issues. The goal of these sessions is to engage in open, honest dialogue about the problems and to brainstorm potential solutions together. Emphasize a partnership approach where both parties work towards mutual success rather than treating the MSP as merely a service provider. This helps foster a cooperative atmosphere that is more conducive to problem-solving.

• Leverage MSP’s Expertise: Encourage the MSP to bring their expertise to the table by suggesting technical or process-driven solutions that they believe could address the issues. For example, if the problem lies in response times, the MSP might propose a restructured escalation process or additional resources to handle peak times more effectively.

• Develop Actionable Solutions: For each identified issue, agree on specific, actionable steps that the MSP will take to resolve the problem. These solutions should be realistic, considering both the capabilities of the MSP and the resources they have available. Document these solutions in a shared action plan, ensuring that both parties are clear on the expectations and next steps.

Set Clear Goals

• SMART Goals: Ensure that the goals you set are Specific, Measurable, Achievable, Relevant, and Time-bound (SMART). For example, if improving issue resolution times is a goal, specify the desired reduction in resolution time (e.g., “reduce average resolution time from 48 hours to 24 hours within the next three months”).

• Define Success Criteria: For each goal, clearly define what success looks like. This could be a numerical target, such as achieving a 99% uptime rate, or completing a specific task, like implementing a new security protocol by a certain date. These criteria should be agreed upon by both parties to avoid any ambiguity about what constitutes improvement.

• Align Goals with Business Objectives: Ensure that the goals set for the MSP align with your broader business objectives. For instance, if your company is focusing on digital transformation, one of the goals might be to improve the MSP’s ability to support new technology rollouts efficiently. This alignment ensures that the MSP’s improvements contribute directly to your company’s strategic priorities.

Monitor Progress

• Regular Check-ins: Establish a schedule for regular check-in meetings with the MSP to review progress against the action plan. These meetings should be frequent enough to keep the improvement process on track but spaced out to allow the MSP time to implement changes. Monthly or bi-weekly check-ins are often effective.

• Use Performance Dashboards: Utilize performance dashboards or other monitoring tools to track the MSP’s progress in real-time. These tools can provide visual representations of how well the MSP is meeting the agreed-upon goals, making it easier to identify any areas where they are falling behind.

• Provide Feedback: During each check-in, provide constructive feedback based on the progress observed. If the MSP is meeting the goals, acknowledge their efforts and discuss any remaining challenges. If they are not, delve into the reasons why and work together to adjust the action plan as necessary. The feedback loop is critical for ensuring continuous improvement and keeping the MSP accountable.

• Escalation Process: If the MSP consistently fails to meet the agreed goals, it’s important to have an escalation process in place. This might involve higher-level meetings between senior management from both sides to discuss the continued issues. If necessary, refer back to your contract to consider invoking penalties or exploring termination clauses if improvement is not forthcoming.

What to Do If Improvement Isn’t Achieved

Despite your best efforts, there may come a time when you realize the MSP is not the right fit. Here’s what to consider:

• Reevaluate the Partnership: When performance issues persist despite ongoing efforts to resolve them, it's crucial to take a step back and reassess the partnership. Start by evaluating whether the MSP's shortcomings are due to temporary issues or systemic problems that are unlikely to improve. Consider the alignment between the MSP's capabilities and your business needs. If there is a significant mismatch—whether in technological expertise, cultural fit, or strategic vision—it may be time to conclude that the partnership is no longer beneficial. Reevaluate the partnership by comparing your initial expectations and the actual performance delivered. If the gap is too wide and consistent, this could be an indicator that the MSP is not equipped to support your long-term goals.

• Explore Alternatives: If reevaluation leads to the conclusion that the MSP is not the right fit, the next step is to explore alternatives. Begin by researching other Managed Service Providers (MSPs) that have a strong track record in the areas where your current provider is lacking. It’s also worth considering whether bringing services in-house could be a more effective solution. Conduct a cost-benefit analysis of both options. While switching MSPs or moving services in-house can be disruptive, it can also offer long-term benefits in terms of control, flexibility, and alignment with your business goals. Having a backup plan in place is critical—it gives you leverage in negotiations with your current MSP and ensures continuity of service should you decide to make a change.

• Contractual Considerations: Before making any decisions to terminate your MSP contract, it is very essential to review the termination clauses thoroughly. Understand the financial and legal implications of ending the contract early. Some contracts may include penalties, notice periods, or obligations that need to be fulfilled before termination. Pay special attention to any clauses related to the return of data, intellectual property rights, and post-termination support. Ensure that you are fully aware of your rights and responsibilities, and consult with legal counsel if necessary. A well-documented understanding of the contract terms will help you avoid potential disputes and ensure a smoother transition to a new service provider or in-house solution.

Planning for a Smooth Transition

If you decide to switch MSPs or bring services in-house, careful planning is critical:

• Assess Business Needs: When planning a transition, the first step is to conduct a thorough assessment of your current IT setup and future goals. This assessment should include an inventory of your existing IT assets, an evaluation of your current service needs, and a projection of future requirements based on your business growth plans. Understanding these needs will guide you in selecting the right MSP or determining if bringing services in-house is a feasible and beneficial option. This assessment should also include a review of any gaps or inefficiencies in your current setup that the new solution will need to address.

• Select the Right MSP: Choosing the right MSP during a transition is crucial for ensuring long-term success. When evaluating potential MSPs, consider key factors such as scalability, security measures, technological expertise, and customer support. Additionally, assess their ability to align with your long-term business objectives. It’s important to not only evaluate their current capabilities but also their ability to grow and adapt alongside your business. Ask for case studies, references, and a clear explanation of how they have successfully managed similar transitions in the past. This due diligence will help you make an informed decision that aligns with your strategic goals.

• Define a Transition Timeline: A well-defined transition timeline is essential to minimize disruptions and ensure a smooth handover. This timeline should include clear milestones, checkpoints, and deadlines for each phase of the transition. Key activities such as data migration, system integration, and testing should be scheduled in advance, with adequate time allocated for troubleshooting and adjustments. Establishing a detailed project plan with specific timelines helps keep the transition on track and allows for better coordination among all stakeholders. It’s also important to plan for contingencies—having backup plans for potential delays or issues that might arise during the transition.

• Communicate the Plan: Effective communication is critical to a successful transition. Keep all stakeholders—employees, management, and the new MSP—fully informed throughout the process. Clear communication minimizes confusion, reduces resistance, and helps ensure that everyone is aligned with the transition goals. Regular updates should be provided to all involved parties, detailing progress, upcoming changes, and any potential impacts on day-to-day operations. Stakeholder buy-in is crucial, so address any concerns promptly and ensure that everyone understands their role in the transition process.

• A Smooth Transition: To ensure a smooth transition, conduct thorough audits at each stage of the process. This includes validating data transfers to ensure no information is lost or corrupted, checking system integrations, and verifying that all services are functioning as expected. Additionally, plan and conduct training sessions to familiarize your team with the new systems, processes, and tools. Proper training helps to mitigate productivity loss and reduces the learning curve associated with new technologies. Post-transition support is also important—ensure that the new MSP provides adequate support during the initial stages to address any issues that arise.

Wrapping it Up

Managing a relationship with an underperforming MSP can be challenging, but it’s important to strategically approach the situation. Whether you decide to improve the relationship, find a new provider, or bring services in-house, the key is to be proactive, informed, and thorough in your planning and execution.