The new buyers of IT services: a glass half full?

A recent Gartner survey showed that more than half of respondents from business areas other than IT are now involved in technology purchase decisions.[1]

And these line-of-business (LoB) buyers are not just influencing the IT decision – they are increasingly managing their own technology budgets.

More than half of respondents to a newly released CompTIA survey[2] said that between 15-44% of total spending on technology last year was paid for directly from the business unit and did not tap into IT coffers.

Or half empty?

The not so good news for MSPs from the CompTIA survey is that when it comes to managing the technology moving forward, very few LoB buyers tap into third-party resources – as few as 8% of respondents from medium-sized companies.

The rest rely on their IT departments, their own business unit or a collaborative effort between the two to help them to achieve their aims.

While the budget responsible for ongoing IT support costs is a combination of IT and business unit budgets for almost half of respondents to the CompTIA survey as the chart shows – between 22 and 29% of respondents said individual business units are picking up the tab for ongoing support costs.

That is clearly money on the table.

So why is more of it not coming your way?

One reason expressed is that new LoB buyers are not yet familiar with the third-party IT “ecosystem” available to support them. If this is the case, it is an opportunity for MSPs to educate LoB executives as to exactly how they can help.

There may also have been a negative experience of using third-parties for support, so education from MSPs needs to be combined with reassurance – customer testimonials being an obvious tool.

But is this commitment to LoB buyers being made by MSPs?

It seems that in many cases they are being ignored.

The nature of the beast

Who are the main LoB buyers today? This is not a uniform group, as this chart from CompTIA demonstrates.

And here we see one of the problems.

MSPs feel comfortable talking to IT heads and CIOs. Talking to LoB heads is a totally different ball game: they often assume you understand their business as well as they do which will put many MSPs outside their comfort zone.

How do you suddenly become a marketing, finance or HR expert as each meeting dictates?

And LoB buyers typically have different objectives and expectations of the technology purchase process compared with their IT counterparts.

So it is very tempting to continue to focus on selling to the IT department or the CIO. If you do this, however, you may be missing out on a whole new pipeline of business.

It’s time to seize the LoB opportunity

LoB buyers need your services.

Increasingly onerous compliance, data and security requirements are making many aware that departmental IT has become too risky:

After years of rogue spending, they now realise that they may have put their companies, customers and business partners at risk. They also know that they have overbought and are thus using one of every online storage service, collaboration tool and marketing application available. They also realise how difficult it is to manage apps, services and tools bought with credit cards and discretionary budget dollars.

You have the opportunity to simplify their portfolios, rationalise their monthly spending and protect their data, apps and infrastructures.

T.C Doyle, quoted in MSPMentor[3]

Then there is the increasing awareness of cyber-attack risk.

The fact that the latest WannaCry cyber-attack exploited a vulnerability in the Windows operating system for which a patch had been issued in March illustrates that many companies are not protecting themselves against threats by carrying out the IT basics like keeping computers current and patched. Business unit technology may be particularly at risk given potentially limited access to in-house IT resource and a lack of specialist cybersecurity knowledge.

So now is the time to identify the LoB buyers among your potential customers, learn about their business and begin to educate them on the benefits of managed services.

How can you ensure you cover the LoB bases?

You need to engage with LoB buyers.

That means rethinking how you present your services when selling directly to a business unit or when faced with multiple buying touch-points in a company. You must focus on how your services deliver real business value.

In short, this means covering the basics:

• Be aware of who is involved in the purchase decisions in your target companies.
• Actively investigate LoB involvement and factor this into your marketing and sales activities.
• Learn about their business and their personal objectives.
• Use marketing campaigns to educate non-IT buyers as to the generic benefits of using a third party for managed services.
• Promote your services as a way of achieving their business outcomes.

To help, the CompTIA report summarises the kind of material that LoB buyers find most useful.

LoB IT spending is here to stay: get used to it!

The widespread adoption of cloud and other ‘as a service’ solutions has led to lines of business relying less on enterprise IT to fund and run their technology purchases. The growth of mobile and the accompanying ‘IT anywhere’ philosophy is also a contributing factor. And let’s face it – IT is a lot more user-friendly than it used to be.

So whether you see this as a challenge or an opportunity, you need to address it.

If you don’t, you could be leaving a lot of business on the table.

Contact us to see how we can free up your time for sales….

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[1] Source: Gartner

[2] CompTIA: Considering the new IT Buyer, May 2017

[3] ttp://mspmentor.net/your-business/doyle-report-do-you-have-what-it-takes-sell-tech-s-new-buyers