Service Leadership: Unlocking the best-in-class TSP’s secret to greater profitability

In talking with IT solution providers (TSPs), a common question I get asked is, “How can I do better.” The interpretation of “doing better” can vary among TSP owners, with some aiming to increase profits, create value to sell in “X” number of years, or prioritize the ability to support more employees and their families.

Whatever your goal, Service Leadership, Inc.®, a ConnectWise company, can help you discover a data-driven path to higher performance. Let’s explore how leveraging Service Leadership’s expertise and tools can propel your TSP towards greater success and profitability.

Service Leadership overview

For over 20 years, Service Leadership has helped TSP owners and executives maximize sustainable profitability.

TSPs using Service Leadership’s tools have experienced an annual revenue growth rate of 16.7% while simultaneously achieving a faster bottom-line profit growth rate of 25.6% annually. As a result, Service Leadership clients outpace industry growth rates and achieve even greater profitability.

Since its acquisition by ConnectWise in 2020, TSPs have continued to rely on Service Leadership to leverage their financial and operational data to drive business growth and enhance shareholder value. With unparalleled expertise in specific performance drivers and established relationships with TSPs, no other company offers the same level of insight and trust within the industry.

Why partner with Service Leadership?

While there is no school for TSP owners and executives to learn how to run their businesses, Service Leadership provides the tools TSPs need to increase their valuation, add new solutions or services, and even evolve from a current business model to a new one. So, why partner with us?

• Gain valuable financial and operational benchmarking data and insights.
  Benchmarking is the objective foundation for sustained improvements in financial and operational performance. When you can see where you are in your business and can compare your performance to top performers or best-in-class, you are in a better position to make decisions that can help you grow faster, be more profitable and drive up stock value with less risk. We’re proud to offer The Service Leadership Index®, which is widely considered the gold standard for TSP quarterly benchmarking worldwide.
• Learn best practices and proven strategies to grow your TSP.
  Leveraging our proprietary diagnostics and performance improvement tool, SLIQ™, a TSP provides their company’s specific inputs to determine their Operational Maturity Level™ (OML™) score. We use the SLIQ and then create a customized action plan to help achieve greater operational maturity and profitability. This knowledge helps TSPs stay ahead of the competition and drive growth.
• Gain insight into how the industry is performing and how TSPs are recruiting, retaining, and paying employees.
  Two annual industry-leading reports, the Service Leadership Index IT Solution Provider Profitability and Compensation Reports, provide a wealth of information about top performance in the TSP industry. These reports provide unequaled insights and analysis into how the top-performing TSPs are not only growing, changing, and profiting but how they are paying and incentivizing their employees. Nowhere else can TSPs find the data and analysis found in these reports.
• Accelerate your growth.
  Service Leadership peer groups, which are part of IT Nation Evolve™, provide owners and executives with an opportunity to build trusted relationships through which they can openly exchange information and share ideas with their peers in a confidential environment. These small, accountability-driven groups meet four times a year and are led by Service Leadership experts.

Now, let’s take a deep dive into the Service Leadership tools and see how they can help improve the financial and operational performance of your business.

What is the Service Leadership Index?

The Service Leadership Index, also known as Service Leadership Index benchmarking, is the largest scale, longest-running, and most accurate benchmark of IT solution provider (TSP) financial performance, operational maturity, and value creation worldwide.  

Each quarter, TSPs around the world enter their financial data into the secure web app. As a result, they get instant access to over 80 metrics comparing their financial performance to the best-in-class in their business model. They can see their company’s financial performance in real-time, tracking metrics such as revenue, gross margin, EBITDA, expenses, and more on a quarterly basis. The benchmarking data further provides them with a detailed and granular view of what good looks like across almost every ledger account in their business. Leveraging this information can provide insights into how the company is really doing and reveal areas for improvement.

Service Leadership Index® Budget Proforma Tool™ for detailed planning and budgeting

An exclusive tool within the Service Leadership Index is the Service Leadership Index^® Budget Proforma Tool^™. This tool gives TSPs confidence in planning and setting a detailed fiscal year budget. Through a step-by-step process, TSPs submit their budget information in the secure S-LI web app. The system calculates the full-year budget and allocates the amounts across the upcoming fiscal year quarters based on their input.

Once completed, they will have a detailed revenue, cost of goods sold (COGS), and operating expense budget, which can be used to track their budget attainment quarter over quarter throughout the fiscal year. This facilitates better financial management and informed decision-making for improved financial performance, ensures adherence to budgetary constraints to support fiscal responsibility, and increases company value.

What is SLIQ?

SLIQ is a powerful online OML™ acceleration tool designed exclusively for TSP management teams. It analyzes your current operating methods to determine areas of strength and weakness, then creates a customized, detailed action plan that walks you through implementing best practice processes.

These are the same processes that are in place within the highest-performing TSPs and will support your business at one million in revenue or one billion in revenue. No more re-inventing the wheel every time you reach a new milestone. Now, you have an objective way to evaluate your company’s management methods compared to the best-in-class in your business model and replicate those processes that will help you run more efficiently and profitably.

How SLIQ works

• Take the OML assessment: Discover your company’s operational maturity level by answering questions related to the OML traits for your Predominant Business Model™ (MSP, VAR, etc.) across six key areas: Financial, service, strategy, compensation, sales, and security and compliance. After completion, SLIQ gives you an OML score based on your answers.
• Get specific guidance for your business: Based on your OML score, SLIQ creates a customized action plan showing the recommended order in which to work that will give you the highest ROI with the least possible risk.
• Access best practices resources: SLIQ guides you through the process by delivering prescriptive best practices, including tools, simulators, modelers, videos, white papers, how-to documents, and templates to teach you how to improve. 

You will also have access to quarterly SLIQ Fast Track webinars designed to help you gain a deeper understanding of how you can apply OML traits in your business.

Putting it all together

By incorporating the suite of Service Leadership tools, including Service Leadership Index® quarterly benchmarking, SLIQ, and our two industry-leading reports—the Compensation Report and Profitability Report—you will have all the necessary tools to make confident and effective decisions. This will aid in accelerating business growth, increasing profitability, and enhancing stock value with reduced risk.

Learn more about the Service Leadership Profitability Bundle>>