Five MSP challenges, one vicious cycle

Every MSP is looking for engineers, but almost nobody finds them. The real problem sits one layer deeper: what are the people you do have spending their time on? Take senior engineers who lose days to platform maintenance, patching, and audit documentation. Solid work, but work the end client never sees and that adds nothing to what sets your organization apart. So don’t look for more people. Look for work you can automate or hand off to parties who don’t necessarily do it better, but do it more cost-efficiently.

With services like workplace management and standard hosting, a provider can barely differentiate itself. So clients compare on price, and margins shrink every year. Every MSP knows growth lies in advice, specialization, and assurance. But that’s where it pinches: that work needs the senior attention that’s tied up in the standard work from the previous challenge. So the staffing shortage and margin pressure hold each other in a headlock. Working harder doesn’t solve that. Freeing up capacity does.

For years, compliance felt like a box to tick. That’s over. Since NIS2, end clients are asking questions they never asked three years ago: where is our data, who can access it, and can you show us where it is? Many MSPs complain that this costs a mountain of extra work, and they’re right. This work, too, often lands on the desks of scarce senior staff. But at the same time, these are the best conversations there are, because a client who needs to demonstrably be in control will pay for that. The condition is that your own chain is in order, all the way to the data center. Whoever arranges that no longer delivers management, but assurance. And assurance carries a different price tag than a workplace per month.

The conversation used to be about uptime and tickets every quarter. Today, that same client asks what you think of their cloud strategy and whether they should be doing something with AI. That’s the opportunity the market is talking about, and rightly so: I wrote about this in my previous article. You can’t leave that conversation to a junior. It again requires the time of the senior engineer, who is already consumed by standard management and compliance. And that closes the circle: the biggest opportunity for MSPs gets stuck on the first three challenges.

That leaves the topic with the biggest promises: AI. My observation: AI is both the most overrated and the most underrated item on this list. Overrated as a ready-made proposition for end clients, because for most MSPs that business is still modest. Underrated as a tool for their own operation: summarizing tickets, generating documents, catching first-line work. It’s not spectacular. But it is the fastest route to freeing up senior capacity. And with that, AI isn’t really the fifth problem, but the most promising way out of the other four.

Anyone who tackles the five themes as separate projects is fighting fires. MSPs who see the connection know where to start: decide what you keep doing yourself because it sets you apart, and hand the rest to partners and technology. Every challenge on this list gets smaller the moment you let your senior staff do what makes the difference: advice, specialization, and assurance.

This article is the second part in a series in which Worldstream discusses current themes from the MSP market ahead of MSP Global in Barcelona at the end of October.