MSPs can anticipate a multi-faceted business challenge by 2022 as they move towards market strengthening, a laundry list of industry-specific requirements and new ways to work with customers and vendors.
The financial outlook for MSPs, consultants and other service providers remains positive. Gartner Inc. expects the global IT service market to expand 8.6% to $ 1.3 trillion by 2022. The forecast growth rate is slightly lower than the forecast of 11.2% over 2021. The actual results will depend on various impacts, and including increased COVID- 19 cases and inflation.
In addition to that delay, here are a few changes to managed services set to come out in the new year.
The integration of MSPs and cloud consulting will continue at a rapid pace in 2022. MSP sites, on which large-scale small-scale service providers are connected, have attracted a large number of private equity dollars. 2021. Professional service companies have also seen an increase in the interest of investors. Both types of businesses will grow in the coming months.
Trent Hickman, managing director of VSS Capital Partners, a privately held company based in New York, suggested that the top managed services would soon emerge from the current integration phase. “You will see, in the next year or two, these will be the platform,” he said. Hickman Company in October 2021 sold Coretelligent, an MSP platform based in Westwood, Mass., Norwest Equity Partners. VSS has a Coretelligent minority share.
MSP sites seek to expand their geographic reach when purchasing smaller providers.
“The merger is taking place in the market,” said Michelle Accardi, general manager of Logically, MSP based in Portland, Maine. The company has bought 10 companies since 2019 and is planning additional deals as it seeks to exceed its $ 100 million revenue mark in early 2022.
“We want to be able to access national level and local services,” Accardi said.
The next round of integration will include national MSPs. “At some point, we’ll see the venues come together,” Hickman said.
That point could be in 2022, said Abe Garver, MSP team leader and managing director of Focus Investment Banking, M&A consulting firm Vienna, Va. He predicts that the PE-support MSP will hit and will begin to merge next year.
PE companies are looking to pay cash faster than in previous years, Garver said. Creating large sites with high ratings is one way, he noted.
For cloud consulting, look for additional services within companies specializing in major SaaS providers such as Salesforce and ServiceNow.
Service providers who have organized key strategic environments in recent years may see the strategy as beneficial next year – but they will need to address the specific needs of industries still struggling with the disaster. COVID-19 and the need to urgently streamline operations will continue to have an impact on 2022 customer projects.
Ingo Piroth, chief tax officer, US, Trianz, a Santa Clara, California-based digital transformation consulting firm, said: need urgent attention. “
These areas, Piroth noted, include staff and customer development and expertise. As a result, industries facing consumers such as banking, insurance, retail, media and entertainment, are likely to generate the highest demand for integration services and change systems, he said.
Inside B2B, heritage sectors such as manufacturing, real estate, construction and utilities will play next year. These industries “have the same opportunities and challenges, as these industries have been lagging behind and facing threats from their digital competitors,” Piroth said.
Inherited industries will enhance their digital assets, business processes and operations. Priorities include improving the appearance of the supply chain, touching data analytics to improve decision-making, and managing the health and safety of workers, Piroth said.
Some traditional industries face challenges beyond the digital business distinction. Straight organizations, such as utilities and transportation, must tackle federal obligations to secure public infrastructure equipment and software as well as their internal IT systems, said Phil O’Konski, director of operations for services managed, in Cloud and Data. Center Transfer Center at Insight Enterprises in Tempe, Ariz.
Examples of recently introduced requirements include a Department of Internal Security directive that obliges pipeline operators to protect against ransomware threats from operating technology and IT systems. That mission followed the May 2021 redemption attack on the Colonial Pipeline, which temporarily closed the oil pipeline.
In addition, frustrated direct marketing markets such as hosting and retail must re-emerge with modern technology to stay competitive but face major challenges. Businesses in these sectors will seek access to infrastructure in Opex models to avoid significant previous investments.
“We see a lot of them looking to switch to a service model,” O’Konski said.
The vision predicts consumer interest in integrated clouds and integrated clouds, according to O’Konski. In the case of private clouds, businesses can look at purchasing IT based on the use and provision of Opex storage such as HPE GreenLake, Dell Apex and NetApp Keystone.
Finally, the public sector market could prove a dynamic 2022. $ 1.2 trillion infrastructure bill, signed by President Joe Biden on November 15, could trigger a wave of RFPs between municipalities, school districts and state governments. O’Konski said the projects could include community wireless services designed to connect digital divide between traffic cameras and visual analysis systems to improve urban traffic flow.
Customers of all kinds will need more help with the digital transformation by 2022.
SMBs, for example, need to follow the digital business in order to stay competitive, but they typically lack the strategic IT thinking needed to get projects off the ground. Modern CIO (vCIO) service providers may find themselves in a position to help. Consumers, however, will demand more.
For many MSPs, vCIO may be more accurate than vCO – the visual caption – said Gary Pica, president and founder of TruMethods, a consultant that provides training for service providers. The MSP needs to go beyond the strategy – and it may be self-evident – for advice on updating old hardware or updating software licenses soon.
“The real CIO understands the business of consumers, their goals and their risks,” Pica said.
With that in mind, vCIO can offer practical advice when customers migrate to critical cloud applications, build an integrated work environment or develop an Internet security plan, he noted. SMBs need such guidance but cannot afford to hire a full-time technology maven.
“They are not able to have a CIO,” said Pica, who managed MSP before becoming a consultant. They depend on us.
Large companies hire an IT manager to oversee technology investment and oversee key projects. But these organizations also appear to be increasing their use of external consultants and service providers by 2022. The decline in staff in the Great Depression has hampered efforts for digital transformation.
Eighty-four percent of the top decision-makers in Dae.mn commented on their “lack of skills” worrying about staying up at night. The skill gap ranks second on their list of constraints, following only security risks. Half of the decision makers also mentioned the lack of skills and resources as to why they are hiring a digital transformation consultant. Dae.mn, a technology consultant in London, surveyed 200 IT and business executives, more than 60% of whom work in organizations with more than $ 1 billion in revenue. The company published its survey in November 2021.
Forrester Research’s Business and Technology Survey 2021 provides additional data: Twenty percent of market research decision makers say they are taking advantage of third-party partners because they do not have the skills needed or home methods. ” Forrester Survey focuses on companies with more than 1,000 employees who have purchased consulting or third-party technology services in the last 12 months.
Advisers have seen a decline in skills in the market and expect the trend to continue.
The staff sounded the cracks in the system, said Margaret Rogers, chief operating officer of Pariveda Solutions and vice president of the New York office. Organizations are beginning to recognize the number of people needed to sustain digital transformation, she added.
Limited resource businesses ask Pariveda to help re-evaluate their business models, Rogers said. They want to know, for example, how to build a digital product that fits their purchasing preferences for customers. The most difficult part, as COVID-19 continues its contagious phase, predicts that consumers will stick to their new shopping habits and, if so, which ones. “Will they continue to order food online?” she asked.
Rogers said she hopes to produce more types of questions by 2022, while also helping consumers assess the impact of inflation on consumer behavior. The role of consultant: collecting and analyzing customer data to support client personalization efforts.
That may prove to be easier said than done, however, given the changes in specific areas of the mobile device.
“By 2022, personalization will continue to be difficult to navigate through consumer touch sites, such as the iPhone, controlling information shared with apps,” Rogers said. “These policies have the potential to enhance or impede personalization.”
Trianz’s Piroth said he hopes to see IT service providers assist businesses with digital strategic planning and implementation plans as well as changing their business and work models. Other roles include developing workforce and workplace preparedness strategies and helping clients reconsider customer experiences, he said.
The way partners work with vendors and customers will continue to improve, as processes such as innovation and product collaboration build momentum.
Creatively, the service provider works with the technology vendor to create a customer experience. Made products can be a direct application built on a public cloud provider platform, for example. Collaboration also takes place between partners and their customers, especially when the customer wants to develop a new product or service faster than alone. To achieve this, partners provide tools such as software accelerators, which enhance application development.
“It’s a brand new trend,” said Fiona Mark, Forrester’s managing analyst, who spoke on creative collaboration at the company’s recent conference. “We expect to see growth in this area, but it will take time for some organizations to mature to full innovation.”
Changes on partner partnerships include greater use of outcome-based contracts, in which part of the contractor’s fee depends on hitting performance objectives. The results, rather than standard service level agreements, will guide creative projects, according to Forrester.
Mark said 35% of Forrester service providers in the poll expect an increase in customer contracts that focus on delivering results based on results. “Indeed, most providers in this area – large and small – are seeing a lot of interest from customers who want to explore more work methods,” she added.
MSPs and consultants can also predict participation in the launch as the first end of the creative agreement. Chad Routh, a senior analyst at Forrester, described the deployment as a small part of the task of evaluating a client problem statement before a major project.
Gartner, meanwhile, also sees a future of innovation, in which a market researcher refers to a production partnership. In this way, the client and its partners jointly create and build offerings, which they sell together to share revenue, according to Hung LeHong, vice president and analyst Gartner.
“It’s going to happen more than you think,” LeHong said, referring to a recent Gartner event. Gartner expects IT-based spending to grow at an integrated annual growth rate of 31% over the next five years.