Fixed IT support fees

by | Jan 7, 2015 | Business

In 2015, we underwent an operational renovation where we began to charge a fixed monthly IT support fee.

At that time, the vital part of our renovation was to change our arrangements with our customers to a fixed, “all-inclusive” monthly fee. This, as opposed to charging a fee that was simply based on the amount of work that we did, for example, an hourly rate. 

In an hourly-rate arrangement, an IT business makes more money the more work that they end up doing. 

In a fixed-price arrangement, the IT company makes more money the less work that they end up having to do. 

This fact is critical to the economics of being proactive; it is the foundation of our business model. It takes a major investment to become effectively proactive as we invest in tools and processes. A business can only make a major investment if there is an ability to get a return on that investment. For an IT company, that bills hourly, this lack of investment in proactivity is going to hurt their own business as it reduces their billable hours. The economics dictate that these companies will only be able to invest in the proactive changes that their customers demand of them, which, given the general lack of understanding here, is very little.  

We do more; we charge more 

One of the biggest problems with our industry revolves around IT companies not charging enough to have the resources needed to do what required to get done, proactively; to produce great results. 

Most techs get into the IT support business and look at market rates and common practices and then build their own IT business operations on this small amount of research. The problem is the market is based on a minimal level of service (firefighting). So, as it turns out, IT companies are great at selling firefighting, but very few are charging enough to get effective sprinkler systems in place — you know, metaphorically speaking. 

Put simply, with this renovation, we see clearly that we needed to do so much more. It is difficult and complicated to do more in business without charging more. Have I written this sentiment out enough times? 

Let me have another go: we care too much about our customers not to charge them enough. 

In my opinion, paying an hourly rate is one of the biggest mistakes that small to medium sized businesses can make with respect to their IT support vendor (at least for companies who value technology). The irony is this is what many businesses seek. Many don’t know there is a far superior alternative. 

Messaging and marketing 

Consider for a moment the challenge ahead of Smart Dolphins at the outset of this operational renovation. We’re in a broken industry with little understanding of the flaws that plague it. The industry charges hourly rates, offers very little in the way of effective proactive service or planning and generally exists in a cacophony of chaos. Most businesses are unaware of this and think that their current IT support situation is “fine.” To top it off, understandably, most business folks dislike changing IT support vendors — the work is very intimate and misunderstood and they often have a personal relationship with their IT guy(s). This can end up being awkward. 

When we launched our renovation, we needed to set out to change the status quo and this required an intense focus on messaging from our marketing efforts. We needed to show business leaders a new definition for “fine” with respect to IT. There is a different approach. We believe, a much better approach. 

The take-away? I encourage others to look hard at their own industry. Don’t assume that your industry has it figured out. I see an abundance of similar flaws that beget opportunities in the business world. It is easy to assume that we all have it dialled down. Hardly — we don’t. Time to start your own operational renovation and change your industry?

Let us know if we can help.

World-ranked managed support services (MSP) 

Then, in 2018, we wrote, “we are delighted to report that Smart Dolphins was named to the 2018 Channel Futures MSP 501 list of the top IT providers in the world. Wow! Awesome news for the POD — a smart and friendly IT support team hailing from Victoria, BC.” 

We could have written that same blog in 2019, 2020 and  2021.  

There are tens of thousands of MSPs around the world. Being ranked in the top-200 is a great accomplishment that we are enormously proud of.   

So, how does an MSP rank on this list? 

MSPs from all over the world submit applications. Key indicators of success that are considered include:  

  • Hiring trends and workforce dynamics 
  • Business strategies 
  • Service delivery 
  • Revenue growth and business model 
  • Tools and automation 

Much of this began with the advent of our renovation.

Check out all our awards at: 

About Smart Dolphins IT Solutions

Okay, you have spotted our wrapped cars with the dorsal fins on top from time to time. Don’t be afraid to say hi to your friendly neighbourhood dolphin, who knows, perhaps you have a technology question that you just don’t want to pose to co-workers.  

Even though 96 per cent of the work we do can be done remotely, we still visit our clients. Our virtual IT Managers know more about our client’s technology than anyone else, including our clients. They love what they do. 

Started in year 2000 by Dave Monahan, Smart Dolphins originally offered tech support in any way you can imagine. We didn’t look much different than all the other IT providers out there. So, Dave decided that there is a better way to go for clients and for Smart Dolphins. That better way is to work where the POD isn’t just putting out fires all the time, but strategically managing client IT success so there is less chance that fires would flare up (and need to be put out in a panic or emergency).  

We have now built a world-class IT provider for small to medium sized businesses located throughout British Columbia. If your business has a dozen or so computers and upwards to around 100, you are the right size for an MSP and Technology Success Partner like Smart Dolphins IT Solutions.  

Feel free to contact the POD!