Data Intensity

Supported Managed Service Provider transformation with targeted cost and revenue improvements

Rick Condon and Mac Hodell are great at illuminating blindspots - and then even better - rolling up their sleeves to help us address the issue, close the gap, and cash the checks associated with the improvement. Shocker! Consultants who do more than create groovy Powerpoints with awesome heat maps. If you are super busy running an MSP/CSP, and your gut tells you there are things going on that you cannot see (or have the time to act on), call Inside Consulting. They won't waste your time. Disclosure: There is zero remuneration, or advantage, or channel juice to me or Data Intensity associated with this commendation. I just like to see good companies flourish.- Phil LaForge | CEO

Situation:

  • Data Intensity faced margin pressures, as the company was transforming from a labor-based Managed Services Provider to more of a value-added solutions provider.
  • The Management Team retained Inside Consulting to identify and prioritize profit improvement initiatives across the cost structure and revenue model.

Insights and actions:

  • Found significant labor cost reduction potential ($4-5M/yr), based on implementing target spans of control and de-layering selected functions’ middle management and on improving key functions’ productivity.
  • Identified systematic underbilling issues and identified $2M/yr of revenue leakage.  Developed structured process for invoice reconciliation and leakage reclamation.
  • Developed updated pricing models for key services services to preserve and expand margins during period of high inflation.  Models helped shift revenue model from labor-based pricing to value-based solutions.
  • Implemented revised client profitability model and pricing guidance, enabling rapid renewal assessments, improving average margins of existing customers.

Impact:

  • Collectively, the profit improvement initiatives added >$6M in 2022 EBITDA, resulting in dramatic margin improvement for the business.
  • In addition, identified another $4-5M in potential EBITDA improvement via revenue improvement found for 2023.