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4-Profit Leadership Forum | September 30 – October 2, 2013Inverness Hotel & Conference Center | West Englewood, Colorado

Fostering Efficiency

It’s About Moving the Needle

Shoes are made for walking

Top 5 Costs Attributed to Shortcomings in Managing/Using Data (the stuff our systems generate)1. Wasted time that could be spent in other areas of the business2. Internal confusion over priorities 3. Inefficient or slow decision--‐making / Lack of agility4. Inability to effectively assess staff performance5. Lost sales and reduced margins due to operational inefficiencies

- source CompTIA September, 2013

• Look at the similarities above - it seems the first 4 are *management issues* leading to point #5. We have a “big data” opportunity here and often need to start with ourselves.

What is the goal of our time together today?• Understanding metrics and how they

change over time?• Sourcing the optimal org structure?• When to hire that next tech, pm or

admin?• Finding the “ideal” PSA or quoting

tool?• Clarifying the 2020 landscape?

No, really.

• What are we doing and why? • Who’s on board?• How do we do it?• How do we know if we are doing a good

job?• What’s next?

Oh, and does it drive a better “service” experience for customer’s?

Solution Provider 2013 2020

Services Frenzy.. A proactive model

Setting Attainable Expectations

Gross Margin Defined

• Gross Margin (or Gross Profit) is:

Sales – COGS (Sales – COGS)/Sales = %

Labor-loaded Gross Margin

How “unique” are you?

• Efficiency• Value• People • Sustainability• Key metrics

Gross Margin Transformation

Six barriers that can slow transformation

Cautious Management Culture Business-as-usual Management Process Initiative Gridlock Executive’s at odds Disengaged Employees Loss of Focus During Execution

Robert H. MilesHarvard Business Review

IT Service Management

When considering gross margin targeting and growth, cloud need not be a panacea..

Nor is full hosted (cloud) an end game for all but the largest hosted providers (eg; Amazon as a low cost provider). Hybrid models are likely.

IT Service Management

ITSM (IT Service Management):

The adoption of cloud-based ITSM solutions will peak in 2014; and by 2015, 30% of those companies that swung to cloud implementations will go back to on-premise ITSM deployments.

- Gartner, 2013

Goal: Finding the Optimal Path

Growing Gross Margin Exercise:

Brainstorm key actions or opportunities you are working on today or you could work on toward raising gross margin

(and stability) in your business?

(20 minutes from each table and share)

Leading Ways to Increase Gross Margin• PRICING! – yes, what are we charging our customers and

what do we leave on the table? • Attach/bundling higher margin services with core

projects/advanced services (USP’s)• Obtain the highest discount rates and rebates• Help Desk and Customer Service Efficiency (crew drill)• Professional Service Efficiency• Client retention and per client spend/hooks• Focus and discipline of staying within target client• Rigorous review of client loss – especially managed• Maximize systems, process and training thereof• Utilization (% hours worked) and realization ($ generated/hr)

The soft stuff that moves gross margin• Customer service skills! - first impressions, how to collect

money, how to manage difficult conversations, connectedness between sales and technical

• Clear visioning• Urgency to pick up a ringing phone (training)• Client “touch” frequency and consistency (proactive)• Customer retention• Time recording • Realization vs utilization• Employee health - hiring/retention• The really soft stuff like customer thank you’s

People

Move the needle…