A Cloud Perspective

Mendy Green
December 18, 2022
20 min read
Share this post
“Should my business be going to Cloud?”

This is one of the most popular questions that comes up in my conversations with clients, and like every other question I get, I like to answer it with “It depends”.

Before we can address this, we need to address the ongoing struggle between IT Professionals and Marketing Professionals. This was cleverly outlined in the classic Project Management meme

We won’t get too far into the specifics of this as Marketing can be a post all by itself, but suffice to say, the…let’s call it exuberance to sell something new, tends to make for overly aggressive messaging targeting the Stakeholders which does not generate tingly-friendly feelings on the people who actually have to implement, support, or answer questions about the technical specifics. This is true no matter if the “Expert” person is at your company or the company the marketing person is sitting at. If you need a further demonstration of what this looks like you can watch the skit on YouTube called “The Expert” which should give you an idea of what frame of mind to approach this question with

Keeping this in mind we need to immediately increase our level of skepticism when we hear about Cloud Computing (or really any new technology).

Let’s switch tracks for a moment. One of the things I always talk about is how there’s at least two sides to everything. Literally you can take a specific item, scenario, concept, etc. examine it and you’ll see two or more sides that reflect or are directly opposite to each other. In business finances for example we have Operating costs and Cost of Goods Sold (COGS). Traditionally Operating costs were made up of things like Rent for the office, Utilities, supplies and things like that. Supplies would include the cost of equipment (such as computers) Utilities would include cost of the internet and so on. COGS would be made up of how much money the business would need to spend, in order to provide the service that they offer. This is essentially two sides to the same thing (money being spent), but you track them separately because they help you break down the cost of running the business vs the cost of providing services.

In other words, Operating Expenses can be broken down to the point where you would assign a Per Dollar amount for each Employee that you have, and COGS would be broken down and assigned a Per Dollar amount for each Customer

Now let’s get back to the point of this. Cloud, like everything else, has 2 or more (way more actually) sides. There’s Infrastructure as a Service offerings, Platform as a Service, Software as a Service, and so on and so forth and all of these items get mixed up and placed into the “Cloud” category. If you dig into what Cloud actually is, you’ll find that it’s just…rented computers. Really. If you’re skeptical, you can read more on this here from one of the bigger software platforms on their reasons why they’re leaving the cloud.

The questions we’d want to answer so that we can determine if you should be moving to the cloud are as follows.

Would you be moving your Operating Expenses to the cloud or your COGS. Specifically, are you providing an online service to your clients that requires you to rapidly scale up if you were to grow, or that allows you to measure out the cost of running in the cloud against the number of users you’re servicing?

Running in almost any cloud has pricing that is broken down to the minute, generally speaking. This is one of the big things marketing likes to tout “Scale up or down as needed, so it’s very cost effective”. Cost effective compared to running them 24/7 sure, but not cost effective compared to buying hardware. Marketing is selling you on the idea that if you needed to turn down services, you can do rapidly and save money with it off, but if you never need to turn down services, and your scaling doesn’t happen rapidly, then you’re actually spending way more over the same period of time of hardware life. Up to 4 or 5 times the amount potentially.

Do you have a need either from a compliance standard or your own security policy for enhanced security, physical auditing, a requirement to be highly available or a guaranteed uptime of 4 or more 9s (99.99%)?

Here is where it starts making sense to consider, although the question of finding a datacenter that will rent you hardware or allow you to place hardware vs running in something like Google Cloud, Azure, or AWS is still debatable. In the end the level of redundancies that exist in the cloud or datacenter are harder to build (read, more costly) than using an infrastructure that is already built and essentially being shared. This isn’t a new phenomenon, if you’ve read my article on the MSP Business Fallacy, or even just paid attention in the world the idea of pooling resources to save on costs is a well-established and very successful pattern. This is something that can range on a spectrum from sharing power costs, to sharing full on hardware and running your services on segregated containerized workloads.

Are you concerned about control of your data. Specifically, does it matter to you if your data is physically on equipment that you solely own and control, or is your business okay with the data being placed onto equipment owned and controlled by a trusted Third Party

Data sovereignty is an important part of the equation, even if you do trust it to a third party, the question of which region and where it is physically located is still an issue. In the end the agreements you sign with vendors and clients state that the data you hold for them is your responsibility to protect and keep safe and you do not have the right to assign that responsibility to anyone else. These are all concerns that should be evaluated and addressed in your assessment of moving to cloud.

In the end there’s no real good right answer, as most of these questions are ones you’ll need to decide for your business. I’ve outlined a table below to help with the decision matrix, but it is still only just a suggestion.

Share this post
Mendy Green

I'm passionate about IT, driven by a dual love for solving complex problems and a commitment to transforming the stereotype of technical support into a positive and enjoyable user experience. For over 13 years, I've been deeply involved in the MSPGeek community, lending my expertise to various Managed Service Providers (MSPs), while also serving as the CTO at IntelliComp Technologies.

My journey in the tech world is fueled by a passion for teaching others. I find great satisfaction in imparting problem-solving and critical thinking skills, and offering practical guidance during the troubleshooting process. It's this enthusiasm for mentorship and improvement that led me to my current venture.

Today, as the founder of Rising Tide Consulting Group, I'm focusing on the MSP industry, dedicating my time to coaching and assisting both individuals and businesses. At Rising Tide, we're not just about providing solutions; we're about nurturing growth, fostering innovation, and building a community where everyone can rise together. Whether it's through hands-on problem solving or strategic planning, my goal is to make the IT experience not just efficient, but also empowering and enjoyable

See some more of our most recent posts...
June 9, 2021
8 min read

The MSP Business Model Fallacy

In any business where you’re not billing Time and Materials, the amount of time you spend on a project directly correlates to how profitable you are. In an MSP, this applies even more.
Read post

In any business where you’re not billing Time and Materials, the amount of time you spend on a project directly correlates to how profitable you are. In an MSP, this applies even more. MSP Businesses were designed years ahead of their time, bringing into practice concepts such as recurring revenue, outsourcing, efficient resources, and more; before people even realized the value. It’s the reason that today the MSP Businesses are blowing up with everyone you meet starting their own. Unfortunately, there’s a complex side to the framework of an MSP that is very often overlooked, especially by those just starting out.

Let’s discuss how the MSP business model is built. MSPs pitch to their prospective clients that they can provide the same level (or often times better) IT Services to their organization than they themselves can find if they go with someone internally. They ask for less money, and offer a bigger team with greater experience. These same MSPs then have to turn around and hire the same people that would have been hired directly, and not just one, but two or three or more depending on the size of the MSP.

MSPs have to pay the same salary with a smaller budget. How can these numbers possibly work?

This is where efficient resources come in; an MSP needs to stack multiple clients reusing the same resources for each client so that together all the clients combined pay enough money for the MSP to pay the technicians salary and make a profit. The income also needs to cover all base expenses of the MSP which includes infrastructure such as an RMM, PSA, Email, Phones, over-night team for emergencies and so on.

With an internal IT resource, that resource would be solely focused on the business they were working for and getting paid a full salary of say $52k/year, now the same resource at an MSP is getting paid $52k/year and needs to  stay on top of not one company IT needs, but actually 3 or 4 (or more depending on the contract size of each). This kind of expectation is unreasonable and when maintained results in high-stress work environments and eventual burn out for the technician. The saying “trial by fire” is very applicable to the technicians who work at an MSP. They are under constant barrage of tickets and stress, jumping from company to company each ticket wildly different from the next. This makes them unusually skilled and also rapidly exposes them to a wide range of experience they may not have received working for just one company. A good MSP technician of the lowest tier can easily go head to head in ability (if not knowledge) to a mid-tier internal IT resource.

Now keep in mind that when MSPs started we were a new phenomenon. There was no standard to follow, no existing business to copy, except for the existing internal IT department within a Company. We didn’t know what kind of pay structure was fair to offer a Tier 1 or Tier 2 technician because there was no “average pay” metric. The only thing we did know is that we are building a business with a stress on smaller dollar amounts per client, and more total clients. This means what we paid our technicians had to be less too, or that we keep the MSP as lean as possible with only the amount of technicians truly needed. Following the 80/20 rule we determined that 80% of the time with our clients running smoothly we would be fine and only 20% of the time when some kind “perfect storm” would occur we would need to motivate our technicians to put in more effort (or what was generally called “figure something out”).

What’s being described is not a sustainable long term plan. Simon Sinek likes to stress that business is an Infinite Game and that those who are not playing by those rules are doomed to failure eventually. The only way to stay in the game is by having resources, and the will to keep playing. We’ve already established that MSPs do not have the same pockets as a normal business, not without drastically imposing upon “will”, our employees, making them work in stressful environments and constantly being battered by the next broken issue.

The fix for this is easy, and its an iteration of what we already started. Efficient use of resources. Efficiency can help us spend less time per ticket, less time per client, and improve our technicians stress in the environment. There are two side to the efficient use of resources, one of which we already started (Sharing resources among companies) but the other is often overlooked “Work load management”. If we can make our work load efficient we can easily improve upon all the issues we just brought up. Here are some ideas that can be used to help facilitate the efficient workload.

Efficient resources is way more than just sharing resources. Making your workload efficient is just as important. Remember how profitable you are directly correlates to how efficient you can be
  • Proactively addressing age of client equipment
  • Proactively addressing ticket trends over time to help improve underlying issues
  • End User technology training for better understanding of the tools they use
  • Breaking Client’s business vertical into separate teams to allow for familiarity of Line of Business applications and setup
  • Building an MSP supported technical standard as your “stack” to ensure familiarity with technical infrastructure
  • Establishing formalized business processes for your MSP Teams so they know where to find information and how to proceed
  • Building an Automation First environment allowing you to offload work from your team to your technology decreasing the amount of time spent on tickets.

Remember, in the MSP business time isn’t a loss of potential profit, its actual profit lost as your contracted rate is the same every month. Automation and bulk actions are extremely important as the less time you spend doing something the more your Per Hour amount goes up.

October 20, 2022
8 min read

The #RisingTide LevelUp Challenge

The butterfly effect is a term used to reference a scenario where, if you were to go back in time 1000 years and step on a butterfly and then return to your current time, you would find that everything has been changed. Potentially even you would no longer exist.
Read post

The butterfly effect is a term used to reference a scenario where, if you were to go back in time 1000 years and step on a butterfly and then return to your current time, you would find that everything has been changed. Potentially even you would no longer exist. This is explained as being caused by the fact that everything in the world is connected (as being part of the same ecosystem) and therefore given enough time the effects of a tiny butterfly being squashed can exponentially grow into an event where the Germans won World War II, or your parents never met.

In a world today where we are too busy to look beyond the face value, the lesson is pretty clear. If you go back in time, make sure you don’t step on any butterflies. If we were to stop and look beyond the face value, the lesson hits far closer to home. Scientists use this to explain that even a small change in a complex system can have a huge impact, but even they distill the true lesson down to its practical use for themselves.

Have you ever watched a Wave roll through the stadium audience, proud to join the hundreds raising their hands but jealous you weren’t the one who started it? What did the other person have that you don’t? Why couldn’t you be the source of this impressive movement visible throughout the entire stadium? The answer is honestly, nothing. Just the courage to go first, and be the leader, influencing others around you and creating an impact that spreads.

You have been created in order that you might make a difference. You have within you the power to change the world. – Andy Anderson

The Rising Tide Consulting Group is movement looking to start the waves, creating the tide, that will subsequently create larger waves, and larger waves, eventually rising higher and elevating everyone within the ecosystem. Let’s go back to the Wave in the stadium, can you imagine if the first person lifted their hands to create the Wave and the person next to them watched, acknowledged it was cool, and did nothing? The only reason why the Wave works is because the second person who follows, then the third, and the fourth and so-on. This is why at Rising Tide we are hyper-focused not on your business, but on your people. If we do your work for you, there is no impact, and we are left deciding if we should keep raising our hands to make up for the effort of those who aren’t joining or give up! If we can influence you doing your work, we can be the start of a massive wave that will spread not only throughout your entire business, but to your clients, and your vendors, raising the level of partnerships and quality of service being delivered to you, and by you.

The Rising Tide LevelUp Challenge is our ‘Audience in the Stadium Wave’. A movement started by our mentor Mendy Green on LinkedIn, where you take three stories, or analogies, and you pull out a lesson learned from each one (similar to how we did it with The Butterfly Effect mentioned above). After your three lessons you call out three new people to partake in the challenge and post their own. The lessons can be repeated, but the analogies or stories must be different.

In every situation, scenario, or story, there’s always a lesson to be learned. The scientists knew that when they framed the Butterfly Effect to teach their lesson, but each person will look at these stories and lessons through a colored lens filtered for their specific use case! It’s up to each individual as they hear these to take a lesson that relates to them. In fact, it is with Elizabeth Copeland’s lesson from the challenge (“Sometimes you need to stop and take in the view”) that we can examine analogies and situations and pull out a lesson from each one relevant to us to help us grow; the difference between taking something at face value or looking for that deeper meaning.

You can find her lesson and more by looking for the tags #RisingTideChallenge or #RisingTide on LinkedIn.

December 12, 2022
8 min read

What should I know about my business

As a business owner, it’s important to have a good understanding of your business goals, and its operations. There are several key questions that every business owner should be able to answer in order to ensure the success and growth of their company.
Read post

As a business owner, it’s important to have a good understanding of your business goals, and its operations. There are several key questions that every business owner should be able to answer in order to ensure the success and growth of their company.

  1. What is your why? If you know me personally, by now you know I am a follower of Simon Sinek. Simon’s consistent chasing the why is something I’ve come to admire and strive for. The reason you get out of bed every day, the reason you go to work, if you know it, it’ll sustain you and become the building block for your Company Culture and Core Values.
  2. Who are your customers? It’s important to have a clear understanding of who your target customers are and what their needs and preferences are. This will help you tailor your products and services to meet their specific requirements and create a more personalized customer experience. More importantly, staying in touch with them will help you adjust to their changing needs, so you stay relevant.
  3. What is your revenue model? How do you generate revenue and make a profit? This could be through the sale of products or services, subscriptions, advertising, or a combination of these methods. Understanding your revenue model will help you identify growth opportunities and make strategic business decisions.
  4. What are your expenses? It’s crucial to have a good understanding of your business’s expenses, including fixed costs like rent and salaries, as well as variable costs like materials and marketing expenses. This will help you manage your cash flow and make sure your business is profitable.

As a business owner, it’s essential to have a strong and focused culture and a set of core values that guide your company’s actions and decisions.

Business culture refers to the values, beliefs, and behaviors that make up a company’s identity. It’s the “personality” of the organization and the way it operates. A strong culture is one that aligns with the company’s goals and mission, and that supports the growth and success of the business.

These values should reflect your company’s mission and goals and should be integrated into every aspect of your business operations. Once your values are established, it’s important to communicate them to your team in to help make sure they are integrated into the company’s operations and decision-making processes. While all the other points are critical for owning and operating a business, they are also all areas that can be delegated (and usually are for larger businesses). The first point, regarding company culture is something that can only come from the top.

There are several reasons why this can have a major impact on the success and growth of your business.

First, a strong and focused culture can help attract and retain top talent. Employees who share your company’s values and beliefs are more likely to be motivated and engaged in their work and are more likely to stay with the company long-term. This can improve morale and productivity and can help drive the success of your business. This can include offering opportunities for professional development and growth, providing a healthy and supportive work environment, and recognizing and rewarding outstanding performance.

Second, a consistent and focused culture can improve customer satisfaction. Customers want to do business with companies that share their values and beliefs. Simon Sinek uses the one wearing the Red Hat as an example. People gravitate to those they connect with and by having a clearly defined culture you can articulate it allows others to see what you stand for and more easily connect with you, which can help increase loyalty and repeat business, as well as establish a greater level of trust.

Third, a focused culture and set of core values can provide guidance and direction for your employees. By having a clear set of values that everyone understands and adheres to, you can create a cohesive and consistent brand and customer experience. This can help improve collaboration and communication within your team and can make it easier to make strategic business decisions.

Finally, having that strong culture and core values established gives you guiding principles when it comes time to pick which companies you start a vendor/client relationship with, being able to articulate what you stand for allows you to recognize easily those that align with you or those that do not. You can quickly identify business practices and test them against your core value. “Is this company being honest”, “Do they care about customer experience” are questions you can easily answer based on the start of the relationship and your interaction throughout.

While having a unique selling proposition (USP) is often considered an essential part of a successful business, there is some debate over whether it is still relevant in today’s competitive market. With so many businesses offering similar products and services, it can be difficult to differentiate yourself and stand out from the crowd.

Additionally, many prospects may not have the time or inclination to thoroughly research and compare different vendors before making a purchasing decision. They may rely on marketing messages and other external factors to make their decision, rather than taking the time to evaluate the validity of a company’s USP.

In some cases, a company’s USP may be seen as simply a marketing tactic, rather than a genuine differentiator. This can lead prospects to view all USPs as equally valid, or to disregard them altogether.

Overall, while having a unique selling proposition is still important, it may not be as effective as it once was as a marketing strategy in a crowded and competitive market. It’s important for businesses to carefully consider their USP and whether it is a genuine differentiator, or if it is simply a generic marketing message, and in reality, aligning this with your Culture will help give you a true differentiator.