Managed service providers (MSPs) are essential for many small and medium-sized businesses across the globe. The services they offer help companies be more productive and profitable. To make sure they’re improving their client’s operations and maximizing customer satisfaction in the process, the best MSPs look at specific key performance indicators (KPIs). But what are these metrics, and how do they contribute to MSP performance?
11 Vital Managed Services KPIs
When it comes to making important decisions, using data is often more beneficial than relying on intuition or gut instinct. However, it can’t just be any kind of data. MSPs have to use the right IT support metrics. For example, knowing that your favorite color is blue isn’t going to help an MSP optimize your IT environment. These KPIs need to drive performance, maximize profit potential, and increase operational efficiency.
While each MSP has their own datasets they like to pay attention to, most managed service provider metrics revolve around three core areas: productivity, client experience, and profitability. There are dozens of KPIs that fall into these three categories, but we’re only going to focus on the most important ones MSPs use to keep clients like you happy.
By measuring productivity KPIs, your MSP can learn how efficiently you’re working, if resources are being used effectively, and if you’re receiving the best possible service. This allows them to improve in areas that are lacking, so they can deliver the service you deserve.
Average Resolution Time
As the old adage goes, time is money. Clients are usually busy, and don’t have a lot of time to wait on a solution. Unsurprisingly, resolution time plays a big role in customer satisfaction. As a result, the best MSPs monitor how long they take on average to fix a problem and work to shorten that time.
First Contact Resolution Rate
While speed is important, it’s not the only factor that matters. Your vendor knows that how the resolution is reached is just as important as speed. For example, you can get a fast solution, but it would still be a bad experience if you had to ask for assistance more than once. That’s why MSPs track the percentage of clients they’re able to help right after first contact.
Resource Utilization Rate
As a customer, one of the most important MSP value propositions to you is having access to top-quality technicians. However, their time needs to be managed wisely so they don’t keep you or their other clients waiting too long. As such, it’s necessary for MSPs to assess the usage rate of their resources.
At the end of the day, an MSP is a business, and their goal is to convert you into a paying customer. This requires better ways to sell to you after first contact. As a result, MSPs are constantly creating better service packages and deals to win you over.
Client Experience KPIs
Healthy business relationships are the foundation of most companies, and your MSP is no different. IT providers like The Logic Group are dedicated to keeping you happy.
The happier a customer is, the more likely they are to come back or even recommend an MSP’s services. It literally pays to do whatever is necessary to maintain a high satisfaction rating. That’s why MSPs care a lot about receiving good reviews and testimonials from people who have used their services.
Another critical client-centric KPI is turnover rate. This refers to how many customers are canceling their contracts and for what reasons. If the turnover rate is high, that’s a telltale sign there may be something wrong with the service and a change is needed.
A service-level agreement (SLA) is a contract that outlines what the customer can expect from the provider, and it’s up to the provider to meet those expectations. Tracking SLA compliance is the easiest way for an MSP to ensure it’s fulfilling its promise to you.
Customer Lifetime Value
There’s nothing better for a business than a repeat customer. That’s why your MSP wants you to be a long-term client who can rely on their services. Gauging customer lifetime value helps the MSP consider what they need to provide to keep you around for the long haul.
The last area of concern for your MSP is profitability. The more profitable your MSP is, the more leeway they have to improve their services and provide better deals.
Cost of Goods Sold
Cost of goods sold (COGS) refers to the labor, material, software, infrastructure, and anything else used to deliver services. Your MSP wants to give you the best deal possible, which requires an acceptable balance between COGS and the service price point.
Recurring Revenue Rate
Relying solely on upfront sales can be a dangerous game for an MSP, so they need to find a way to keep the revenue flowing at all times. This often takes the form of subscriptions, renewals, and contracts. The need for recurring revenue benefits you because it forces your MSP to find innovative solutions to earn your patronage.
Rate Per Offering
When an MSP’s service is expanded, it could be simply because the owner wants to provide more value for their customers. In other cases, it’s deemed a worthwhile investment after reviewing the rate per offering.
Get the Best in IT Services
The Logic Group is dedicated to delivering the best IT services in the industry. We work with you to customize our services according to the specific needs of your business. Contact us today to learn how we can improve your operations.