This post is sponsored by GoTo, the leader in cloud communications and IT.
Demand for MSPs has never been higher, with companies across all industries investing in IT services and requiring advanced support. Yet many MSPs are having difficulty scaling their operations and driving growth.
The problem isn’t just landing new customers – it’s also growing strategic accounts. In fact, a recent TSIA poll found that just 8 percent of MSPs can consistently identify and close expansion opportunities with existing clients. This gap between market potential and revenue suggests that many MSPs currently lack the tools, processes and positioning to create new value and drive sustainable growth.
In this article, we’ll explore why MSPs are struggling to scale, and share some practice tips for overcoming barriers and maximizing revenue.
Evolving from MSP 2.0 to MSP 3.0
Many scalability and growth issues today stem from legacy workflows left over from the break/fix or “MSP 2.0” era – like reactive ticket queues, manual patching, and siloed tools. While these approaches were serviceable in the past, they no longer meet the demands of today’s complex IT environments.
What’s more, the role of the MSP is shifting from simply managing technology to solving complex business problems and delivering measurable ROI. As a result, core value propositions that were central to the MSP 2.0 era, like uptime and IT support, are no longer moving the needle as they did in the past. As clients face greater complexity, they’re increasingly prioritizing partners who can deliver strategic impact.
According to Channelnomics, MSPs are “ill-equipped to deliver and reluctant to adopt.”
“Today, MSPs and their vendors face an increasingly different market in which customers want more than just access to technology and peace of mind that their endpoints, infrastructure, and data are working and secure,” says Channelnomics. “They want solutions to their business problems. And just as the average customer doesn’t care what tools MSPs use for their services, they also don’t care what components — hardware, cloud, applications — go into their systems, as long as they produce a positive value (ROI).”
The message is clear: To remain relevant in the emerging MSP 3.0 era, MSPs must establish AI-driven frameworks that leverage predictive insights, real-time intelligence, and automation to deliver proactive, outcome-focused services at scale. MSPs that continue relying on manual, ticket-based support models will be unable to keep up with emerging AI-enabled challengers.
Practical Ways to Improve Scalability
Unfortunately for MSPs, there’s no roadmap or easy path to MSP 3.0. Providers are being told they must transform, but many are just trying to “keep the lights on” and protect their MRR.
It’s important to keep in mind that transformation won’t happen overnight. It requires strategic planning, operational maturity and a robust partner ecosystem. But while there’s no one-size-fits all solution, there are several strategies that MSPs can use to add value and boost revenue without increasing headcount or making drastic operational changes.
Leverage RMM to simplify management
Managing multiple client environments can be complex and time-consuming, especially for small MSPs with limited staff. To expediate operations, MSPs should consider implementing modern remote monitoring and management (RMM) software to centralize IT operations.
While RMM has been around for decades, the technology has recently evolved to include AI and zero-trust security. A modern multi-tenant RMM platform will simplify operations by consolidating customer environments into a single dashboard. This enables faster onboarding, centralized alerting, and proactive IT management.
Deploy AI-powered tools
As TSIA pointed out, many service teams are now using AI and automation to boost efficiency and productivity. However, AI adoption among managed service organizations remains low with 63 percent of surveyed respondents still reporting no current AI use.
MSPs can use AI to streamline ticket resolution, improve response times, and enhance client satisfaction. For example, AI-powered virtual assistants can now handle many Tier 1 requests and free technicians to focus on higher-value work.
Monetize mobile device management (MDM)
A sizable portion of businesses still allow employees to access tools and data using unmanaged devices, putting them at risk for data breaches and ransomware attacks.
For MSPs, there is a growing opportunity to offer device security and policy management as add-on services for mobile and hybrid clients. MDM is a great way to improve customer “stickiness” and drive MRR while also protecting them from sophisticated attacks.
Consider co-managed IT
A growing number of MSPs are offering co-managed, or hybrid support models. This enables the client to retain control and expertise over their infrastructure, while still leveraging the MSP’s tools and expertise.
For MSPs, offering co-managed models can potentially lead to higher margins without placing an extra burden on staff members. Co-managed IT can also free niche MSPs to focus more on specialized services, like cybersecurity or cloud optimization.
LogMeIn Resolve: A One-Stop Platform for Scaling and Growing Your MSP Business
As KPMG explains, managed services are rapidly changing with companies now prioritizing providers who can help drive transformation and unlock innovation. This means there’s tremendous upside for MSPs who are willing to evolve and modernize their service delivery through seamless endpoint management, automation, and proactive maintenance.
LogMeIn Resolve was purpose-built to help MSPs modernize and scale through a single, unified IT management platform. It combines RMM, MDM and automation capabilities along with secure zero trust architecture – plus integrated backup and recovery through the LogMeIn Data Protection Suite powered by Acronis. Together, these solutions give providers all the tools they need to simplify operations and drive growth while keeping operations lean and cost-effective.
Learn how LogMeIn Resolve can help you scale with ease. Connect with an expert to learn more and get a personalized trial.
