In our May 2015 newsletter topic on How We Improve Using Metrics we provided an overview explaining the nuts and bolts of an I.T. company’s operations team and how we calculate our numbers for each role focusing in on the support desk metrics. Today, we are going to take a look at the network administration (NA) metrics and how we are able to improve our company by looking at this role through a few different lenses.
The 1st lens we want to look through to give us a better understanding of our NA role is our industry leverage guidelines. For example, the total amount of work our NA’s can commit to our customers without losing profitability, or overextending the NA’s by spreading them too thin across the customer base is a simple way to describe this guideline. We want to compare the industry leverage guidelines to the amount of active NA’s and monthly reoccurring revenue (MRR) we have in our business. In other words, MSP’s want to have at least 1 NA per 40k in MRR to run efficiently. Based on this simple math we can forecast how many resources we need in X years and also evaluate the current metrics in our business and where we should or shouldn’t be operating. Here is an example:
The value of understanding how each role is performing and knowing all their different levers and how much each role costs in a per month per seat format is the way to gain command over your gross margins. Otherwise, we truly don’t understand the noise behind the numbers, the hole in the bucket, or any unrealized profitability. With that being said, the 2nd lens we want to look through is our cost per month per seat for our NA role. Here is an example:
We also create, manage and track all of our NA tickets in our main line of business application and we look at how many hours we spend in comparison to reactive support. We also track the overall health of our customers quarter to quarter based on NA and vCIO alignment so we can validate our I.T. investment is helping our customer’s business become more successful.
Again, by having these granular metrics across the different divisions in our business, especially the 6 core delivery areas in operations — network administration being one of them, we can forecast change, improve our best practices and processes, and ultimately provide better support to our customers. We strive to improve and become world class every day and knowing our numbers is a small part to that promise.