ChannelTrends: Solution Providers Declare their Independence

It seems many tech-minded people are either tired of working for “THE MAN” or their employers are making that choice for them. Self-employment in the IT channel is on the rise, according to the latest news, with one-man (or woman) shops and other small solution provider businesses flourishing across the nation.

Some of this change may be inspired by previous employers, as the business owners’ companies look to offload or outsource their IT departments. Rather than introduce a new solution provider to the equation, the organization may propose a new alliance with their employee—paying them as an independent contractor. That process is nothing new, people have been fired and rehired as outsource workers in many industries over the years, but the trend in IT seems to be accelerating recently. Perhaps the struggling economy has been a contributing factor, but a number of other reasons could be responsible as well.

Outsourced IT Demand Escalates

Regardless of the financial climate, businesses must keep a close eye on the bottom line and outsourcing part or all of an organization’s IT services is often the most viable option. Cost-cutting is a key driver in solution provider growth, allowing companies to get competitive bids for a variety of technology needs – often more than their current staff can offer.

The advantages go beyond cost, as solution providers certainly understand. You can’t grow a channel company based on lowest price. If you can’t uncover and address the business needs of clients, you won’t keep them for long. A majority of MSPs and VARs have shifted their attention to their customers’ organizational processes and goals as a starting point, then designing and implementing the proper solutions to help meet those requirements.

Internal IT teams don’t always understand their own organizations’ business needs. Many were hired specifically for their technical skills and knowledge of certain systems. In most cases, the technology is their sole focus, keeping it running and responding to the immediate requests of their management team and other employees. Long-term IT planning doesn’t exist for many small businesses, which is the perfect opportunity for solution providers to step in and take over a critical role.

The growth potential for MSPs and VARs is significant, regardless of size. According to a recent online survey by Gartner, the information technology outsourcing (ITO) services market is expected to reach $313.2 billion this year, a growth of 6.9 percent from 2010, and will reach 4.6 percent compound annual growth rate through 2015. That’s going to require a number of new IT service professionals, big or small.

Tech Hiring Continues to Thrive

Despite high unemployment rates in the U.S., the demand for skilled IT labor is high, with opportunities available in virtually every region of the country and all vertical markets. But the prospects for those with both technical and expertise are even greater. The Department of Labor's Bureau of Labor Statistics (BLS) reports that the U.S. added  13,700 IT services sector jobs in August— 6,000 in management and 7,700 in computer systems design and related services. This is according to a recent eWeek article that highlights how well IT professionals fared compared to the general population of job seekers, showing positive growth in this employment segment for the 15^th straight month. The information also illustrates the continuing trend away from hiring traditional (internal) infrastructure IT skills—to outsourced services jobs (solution providers).



Start-Up Solution Provider Businesses

Why should an IT professional start up their own services company? The reasons are numerous and vary from being downsized from their previous job to an inability to work for other people (other motivations are listed in this Channel Insider article). The entrepreneurial spirit remains alive and well, and new technologies and delivery systems make the process much easier for an IT professional to proper.

With the advent of managed services, cloud computing and outsourced help desk providers, even a one-person MSP can offer their clients a robust portfolio and 24/7 support. Owners can build their business to provide everything themselves or collaborate with others to build out their practices. Solution providers can partnering with those they have an existing relationship with or contract with outsource networks, such as the Ingram Micro Services Network or OnForce. The options are numerous, depending on your revenue and organizational growth goals.

While owning an IT services business isn’t for everyone, the opportunity certainly exists for those who have a desire (and the skills) to do it. Of course, the CompTIA Small Business Owners Community provides a great forum and collaborative environment for those who do want to pursue their entrepreneurial dreams and the Channel Training program can help advance their practice or business skills.

The association also provides a number of other benefits that can help IT business owners improve their organization, as well as their technical skills. More than ever, the entrepreneurial spirit is alive for those willing to take the leap, especially for those with IT and business skills. Are you taking advantage of all the resources available to make you successful?

Brian Sherman is founder of Tech Success Communications, specializing in editorial content and consulting for the IT channel. His previous roles include chief editor at Business Solutions magazine and industry alliances director with Autotask. Contact Brian at [email protected].