ascii - anaheim, ca - mar. 2016
TRANSCRIPT
www.itglue.com/ascii
How Success and Peace of Mind Starts with Great Documentation
MY MSP STORY
• 2002 – Founded MSP Fully Managed
• 2008 – 10 Employees• 2016 – 60 Employees• EBITDA from 5% to 25%. Why?
THE IT GLUE STORY
•Founded in 2013•1,000+ Partners•15,000+ IT Pros•25 Employees•17 Countries, 6 Continents
www.itglue.com/why
The first company in any industry that fully embraces the LEAN methodology will dominate their industry over the long run.
LEAN BUSINESS MANAGEMENT
--Eric Ligman, Director, Worldwide Partner Group, Microsoft
WASTE IN I.T.
www.itglue.com/ascii
The first and foremost reason for documenting any process is the fact that it…
AMBIGUITY IS (NOT) AWESOME
reduces operational ambiguity.--Management Study Guide
“Wasted time costs $19,732 per worker per year, a loss of 21.3% in the organization’s total
productivity”
INFORMATION WORKER STUDY
What the actual &$%^?
What makes a best-in-class MSP?
…and what does best-in-class really mean anyway?
Revenue $2,000,000 100%
COGS
Gross Profit
SG&A
Net Income
COMPANY “A” VS. COMPANY “B”
COMPANY “A”
Revenue $2,000,000 100%
COGS $700,000 35%
Gross Profit $1,300,000 65%
SG&A $800,000 40%
Net Income $500,000 25%
BOOM!
COMPANY “B”
Revenue $2,000,000 100%
COGS $1,200,000 60%
Gross Profit $800,000 40%
SG&A $800,000 40%
Net Income $0 0%
FAIL!
Building abest-in-class MSP.
#LetsGo
Process
People
3 AXES OF EXCELLENCE
Process
People
3 AXES OF EXCELLENCE
People don't buy what you do; they buy why you do it.
–Simon Sinek
PEOPLE
Process
People
3 AXES OF EXCELLENCE
TECHNOLOGY
The Stack
Network Servers Workstations Applications Backup Security Governance
www.itglue.com/ascii
Process
People
3 AXES OF EXCELLENCE
PROCESS PAYS
Reduce your costsIncrease your marginsImprove your serviceReduce your risk
COST OF BAD DOCUMENTATION
Team SizeTechnical /Staff
5
Average Annual SalaryFor All Employees
$60,000
Average Hourly Labor RateFully Burdened + 15%, Rounded Down
$43/Hour
Time Wasted Due to Bad DocumentationExperts Estimate @ 20-30%
20% / 10% / 5% (high/medium/low)
Monthly Cost of Time Waste(Number of Tech Staff) x (1 Week Labor) x (Time Wasted)
$6,880 / $3,440 / $1,720 (high/medium/low)
Monthly Opportunity CostBased on 50% GM = (Monthly Cost of Time Waste) x 2
$13,760 / $6,880 / $3,440 (high/medium/low)
Total Monthly Cost of Bad Documentation(Monthly Cost of Time Waste) + (Monthly Opportunity Cost)
$20,640 / $10,320 / $5,160 (high/medium/low)
Total Annual Cost of Bad Documentation(Monthly Cost of Time Waste) x 12
$247,680 / $123,840 / $61,920 (high/medium/low)
www.itglue.com/ascii
IMPACT OF TIME VARIANCE
Sample Tickets 1. Setup New User Account2. Troubleshoot a Slow Computer3. Deploy a New Workstation
Estimated # Transactions AnnuallyBased on 50 Customers, Avg. 20 Staff (1000 Users/Endpoints)
300 Transactions
Estimated Hours Per TransactionTotal Labor Required for Each Transaction
0.5 to 2.0 Hours
Total Annual Cost (All Transactions) # Transactions x Time x Hourly Cost ($43/Hour)
$6,450 to $25,800
Potential Savings w/ Good DocumentationHigh - Low
$19,350 Wow!
www.itglue.com/ascii
IMPACT OF LABOR COSTS
Sample Tickets 1. Setup a New Complex User/Workstation2. Deploy a Switch, Firewall or Backup Device
Estimated # Transactions AnnuallyBased on 50 Customers, Avg. 20 Staff (1000 Users/Endpoints)
250 Transactions
Estimated Hours Per TransactionTotal Labor Required for Each Transaction
2.0 Hours
Range of Labor Costs Per HourVariance from $35,000 to $95,000 + Overhead
$25/hour to $68/hour
Total Annual Cost (All Transactions) # Transactions x Time x Hourly Cost
$12,500 to $34,000
Potential Savings w/ Good DocumentationHigh - Low
$21,500 Wow!
www.itglue.com/ascii
COST OF A NEW HIRE
New Hire Efficiency Time & Cost of a New Employee
Efficiency of New Hire Due to Bad DocumentationBased on $60,000 Fully Burdened Salary, Level 2 Engineer
80% @ 4 Weeks to 80% @ 10 Weeks
Hours Wasted Due to Bad DocumentationTime Spent Training, Researching, “Shoulder-Tapping”
98 to 272
Setup Cost for New EmployeeHours Wasted x Hourly Cost ($43/Hour) + Opportunity Cost
$12,642 to $35,088
Potential Savings w/ Good DocumentationHigh - Low
$22,446 Wow!
www.itglue.com/ascii
ANNUAL SAVINGS (3 EXAMPLES)
Area of Waste Potential Annual Savings(1,000 Endpoint MSP)
Time VarianceVariance in Time Required for Common Tasks
$19,350
Labor CostsTasks Requiring Level 1 vs. Level 2 vs. Level 3 Engineer
$21,500
New Hire / X-TrainingAssuming Single New Hire @ $60K Salary
$22,446
Potential Savings w/ Good DocumentationHigh - Low
$63,296 Wow!
www.itglue.com/ascii
PROCESS IN ACTION
www.itglue.com/ascii
PROCESS IN ACTION
www.itglue.com/ascii
PROCESS IN ACTION
www.itglue.com/ascii
PROCESS IN ACTION
www.itglue.com/ascii
www.itglue.com/ascii