Why Hype Is The Enemy Of Profitability
"Hype is the enemy of profitable, repeatable managed services."
I first made this point on stage at partner summits a few years back. It drew a few nods and a few raised eyebrows, but the line landed. It's a point worth coming back to, because the pattern it describes doesn't really change — only the name of the latest shiny thing does.
Here's the hype cycle, viewed through MSP eyes.
The Managed Service Danger Zone
This is where far too many MSPs spend far too much time, for far too little return.
It starts with A New Dawn. The latest greatest thing arrives in the industry's consciousness, and even though we keep hearing more about it, most of us don't really know what it is yet. Often enough, it's a reincarnation of things we already have and know, dressed up in a new acronym.
Then we climb to the Summit of Buzzword Mountain, where meetings are stuffed with buzzwords and very little substance to back them up. Whoever shouts the loudest on the stand at the show seems to win the day. Customers walk in asking for the buzzword, and only the smartest MSPs peel it back to the actual requirement — which is usually much simpler than the buzzword made it sound.
Soon after, we slide down into Acronym Anarchy. Every news article, meeting and pitch deck has acronyms everywhere, without much substance behind the acronym. The confident few stop saying the buzzword in full and just fire the acronym across the table. Most of us are left with more confusion than clarity.
Only from a small selection of the industry do we hear people talking sense.
The Managed Service Profit Zone
The leading few cut through the noise and make enough sense of the underlying technology to wrap it into a service a customer actually wants to buy.
Welcome to the Ascent of Profitable Standardisation, where bespoke offerings turn into repeatable ones, and the priority becomes a proposition you can deliver to 80% of your customer base. Multi-year contracts, happy customers, happy investors — provided the basics are done well.
The Managed Service Comfort Zone
Stay in the Profit Zone too long and the Descent of Commoditised Erosion sets in. Renewals flatten, margin gets eroded, and standing still ends up being the same as falling behind. Even happy customers can drift off toward whoever is selling the next set of new possibilities.
It's a tough balance to manage, and the trick is not going too early and not staying too long.
My role, really, is quite a simple one — help MSP partners resist the temptation of jumping two feet first into the Danger Zone, be as effective as possible in the Profit Zone, and keep challenging them to progress so they never quietly settle into the Comfort Zone.
