How Can the FTE Model Compete with the MSP Model?
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I'm not saying you're wrong. I'm trying to understand your basis for conclusion because it doesn't make sense to me, and it appears to be the same for others participating in this thread based on their responses.
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@kelly said in How Can the FTE Model Compete with the MSP Model?:
@scottalanmiller said in How Can the FTE Model Compete with the MSP Model?:
@kelly said in How Can the FTE Model Compete with the MSP Model?:
@scottalanmiller said in How Can the FTE Model Compete with the MSP Model?:
@kelly said in How Can the FTE Model Compete with the MSP Model?:
We also cannot simply trust your assumptions if we're to properly discuss the topic. Otherwise we just become an echo chamber and nothing of value is created. Is there some resource (outside of your own articles) that gives empirical credence to your conclusions?
Here is the basis of my logic, this is an assumption so this is where I think you have to prove me wrong: An MSP staffer can act identically to an FTE in price, capability, and function making them identical in all ways to an FTE, but also has the flexibility to do other things that an FTE cannot.
Ok, why do they have that flexibility and an FTE does not?
Because an FTE cannot scale to other customers to bring the benefits of "pool resources".
But our apples to apples comparison requires an equal labor time, presence, and attention. How does the MSP provide pool resources?
You have to break down "equal or better." If you are checking to see if it can be equal, you can prove that with the "acts as an FTE" case. The pool is an option, only to be used when it is beneficial over the "acts as an FTE" case. Since it is optional only, and the other case is equal, you guarantee equal or better because we can prove the ability to always be equal.
You can't do the "equal" and the pool at the same time, obviously. But you have the option to do either.
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@kelly said in How Can the FTE Model Compete with the MSP Model?:
I'm not saying you're wrong. I'm trying to understand your basis for conclusion because it doesn't make sense to me, and it appears to be the same for others participating in this thread based on their responses.
Which part does not make sense? I think it just comes down to the two pieces.
An MSP can act identically to an FTE. So as a worst case scenario, it can be "equal". This is always a guaranteed option within the model no matter what the business scenario is. So we prove from this, that "equal" is available, this alone proves "equal or better" because you don't ever need better to be true with an "or".
That there are other options that are not equal, that are there even if never used (but in reality are used almost 100% of the time because they are that good) offers the potential of "better". This isn't needed to prove the point, as the first equal portion proved that already. But this shows the logical value as to why there is a huge value in the real world, not just a theoretical case.
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@scottalanmiller said in How Can the FTE Model Compete with the MSP Model?:
@kelly said in How Can the FTE Model Compete with the MSP Model?:
@scottalanmiller said in How Can the FTE Model Compete with the MSP Model?:
@kelly said in How Can the FTE Model Compete with the MSP Model?:
@scottalanmiller said in How Can the FTE Model Compete with the MSP Model?:
@kelly said in How Can the FTE Model Compete with the MSP Model?:
We also cannot simply trust your assumptions if we're to properly discuss the topic. Otherwise we just become an echo chamber and nothing of value is created. Is there some resource (outside of your own articles) that gives empirical credence to your conclusions?
Here is the basis of my logic, this is an assumption so this is where I think you have to prove me wrong: An MSP staffer can act identically to an FTE in price, capability, and function making them identical in all ways to an FTE, but also has the flexibility to do other things that an FTE cannot.
Ok, why do they have that flexibility and an FTE does not?
Because an FTE cannot scale to other customers to bring the benefits of "pool resources".
But our apples to apples comparison requires an equal labor time, presence, and attention. How does the MSP provide pool resources?
You have to break down "equal or better." If you are checking to see if it can be equal, you can prove that with the "acts as an FTE" case. The pool is an option, only to be used when it is beneficial over the "acts as an FTE" case. Since it is optional only, and the other case is equal, you guarantee equal or better because we can prove the ability to always be equal.
You can't do the "equal" and the pool at the same time, obviously. But you have the option to do either.
So the only way in which an MSP is better than an FTE is that it can easily switch between "equal" and "pool'? Is that correct?
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@kelly said in How Can the FTE Model Compete with the MSP Model?:
@scottalanmiller said in How Can the FTE Model Compete with the MSP Model?:
@kelly said in How Can the FTE Model Compete with the MSP Model?:
@scottalanmiller said in How Can the FTE Model Compete with the MSP Model?:
@kelly said in How Can the FTE Model Compete with the MSP Model?:
@scottalanmiller said in How Can the FTE Model Compete with the MSP Model?:
@kelly said in How Can the FTE Model Compete with the MSP Model?:
We also cannot simply trust your assumptions if we're to properly discuss the topic. Otherwise we just become an echo chamber and nothing of value is created. Is there some resource (outside of your own articles) that gives empirical credence to your conclusions?
Here is the basis of my logic, this is an assumption so this is where I think you have to prove me wrong: An MSP staffer can act identically to an FTE in price, capability, and function making them identical in all ways to an FTE, but also has the flexibility to do other things that an FTE cannot.
Ok, why do they have that flexibility and an FTE does not?
Because an FTE cannot scale to other customers to bring the benefits of "pool resources".
But our apples to apples comparison requires an equal labor time, presence, and attention. How does the MSP provide pool resources?
You have to break down "equal or better." If you are checking to see if it can be equal, you can prove that with the "acts as an FTE" case. The pool is an option, only to be used when it is beneficial over the "acts as an FTE" case. Since it is optional only, and the other case is equal, you guarantee equal or better because we can prove the ability to always be equal.
You can't do the "equal" and the pool at the same time, obviously. But you have the option to do either.
So the only way in which an MSP is better than an FTE is that it can easily switch between "equal" and "pool'? Is that correct?
Sort of, but it isn't the switching itself that makes it better, it's the larger range of options. MSPs fully encompass all options of the FTE, but then add more. For 99.9999% of businesses, they will never switch or ever consider the FTE style option because it is so dramatically poorer in the real world.
The reason for the "proof" is to show the impossibility of FTE being better. But to do so requires showing MSPs in their worst case scenario, one that effectively will never happen because something else is "always" better for their customers.
It's to show that even at an extreme point, with an MSP being as silly as it can be, it never gets below equal to an FTE. But it's theory only to make an MSP act that way because no one ever finds a business that needs exactly one FTE, never anything more or less, only a single person, never coverage, skills, or anything beyond them.
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I think the most important thing for people to understand here is that we are talking about a model of engagement, not different people.
No one should feel defensive or that the discussion is person because they are an MSP or are an FTE or whatever. It's not about the people, it's about better ways that companies can engage the same people. How to make business, and therefore IT, better for everyone.
Better models mean better results, better careers, better salaries for everyone.
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@scottalanmiller said in How Can the FTE Model Compete with the MSP Model?:
@kelly said in How Can the FTE Model Compete with the MSP Model?:
@scottalanmiller said in How Can the FTE Model Compete with the MSP Model?:
@kelly said in How Can the FTE Model Compete with the MSP Model?:
@scottalanmiller said in How Can the FTE Model Compete with the MSP Model?:
@kelly said in How Can the FTE Model Compete with the MSP Model?:
@scottalanmiller said in How Can the FTE Model Compete with the MSP Model?:
@kelly said in How Can the FTE Model Compete with the MSP Model?:
We also cannot simply trust your assumptions if we're to properly discuss the topic. Otherwise we just become an echo chamber and nothing of value is created. Is there some resource (outside of your own articles) that gives empirical credence to your conclusions?
Here is the basis of my logic, this is an assumption so this is where I think you have to prove me wrong: An MSP staffer can act identically to an FTE in price, capability, and function making them identical in all ways to an FTE, but also has the flexibility to do other things that an FTE cannot.
Ok, why do they have that flexibility and an FTE does not?
Because an FTE cannot scale to other customers to bring the benefits of "pool resources".
But our apples to apples comparison requires an equal labor time, presence, and attention. How does the MSP provide pool resources?
You have to break down "equal or better." If you are checking to see if it can be equal, you can prove that with the "acts as an FTE" case. The pool is an option, only to be used when it is beneficial over the "acts as an FTE" case. Since it is optional only, and the other case is equal, you guarantee equal or better because we can prove the ability to always be equal.
You can't do the "equal" and the pool at the same time, obviously. But you have the option to do either.
So the only way in which an MSP is better than an FTE is that it can easily switch between "equal" and "pool'? Is that correct?
Sort of, but it isn't the switching itself that makes it better, it's the larger range of options. MSPs fully encompass all options of the FTE, but then add more. For 99.9999% of businesses, they will never switch or ever consider the FTE style option because it is so dramatically poorer in the real world.
What options are you saying that the MSP can bring that an FTE cannot? I'm trying to understand how the MSP is better than the FTE.
Here is how I am thinking about it to remove all variables:
Stuart is the IT Pro. He has his sets of experiences and skills. Assuming that he is working full time for only one organization how is he providing more value to the company within the MSP model over the FTE model?
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@kelly said in How Can the FTE Model Compete with the MSP Model?:
Stuart is the IT Pro. He has his sets of experiences and skills. Assuming that he is working full time for only one organization how is he providing more value to the company within the MSP model over the FTE model?
Stuart has the full scale of pooled resources and flexibility from the MSP that the FTE person does not have.
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@obsolesce said in How Can the FTE Model Compete with the MSP Model?:
@kelly said in How Can the FTE Model Compete with the MSP Model?:
Stuart is the IT Pro. He has his sets of experiences and skills. Assuming that he is working full time for only one organization how is he providing more value to the company within the MSP model over the FTE model?
Stuart has the full scale of pooled resources and flexibility from the MSP that the FTE person does not have.
Now we are no longer comparing apples to apples. You're assuming that the MSP has a larger IT staff than the company. Not necessarily wrong, but an assumption that is critical to evaluating and responding to the discussion.
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@scottalanmiller said in How Can the FTE Model Compete with the MSP Model?:
I think the most important thing for people to understand here is that we are talking about a model of engagement, not different people.
Doesn't the model of MSP vs FTE imply a Many vs One scenario? This is where I am getting a little confused when trying to do the comparisons.
If the MSP is a singular person, then there are no pooled resources that belong to the individual MSP that the FTE doesn't have. I am unable to see the difference in the two other than the letters.
Better models mean better results, better careers, better salaries for everyone.
This is always good.
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@kelly said in How Can the FTE Model Compete with the MSP Model?:
@scottalanmiller said in How Can the FTE Model Compete with the MSP Model?:
@kelly said in How Can the FTE Model Compete with the MSP Model?:
@scottalanmiller said in How Can the FTE Model Compete with the MSP Model?:
@kelly said in How Can the FTE Model Compete with the MSP Model?:
@scottalanmiller said in How Can the FTE Model Compete with the MSP Model?:
@kelly said in How Can the FTE Model Compete with the MSP Model?:
@scottalanmiller said in How Can the FTE Model Compete with the MSP Model?:
@kelly said in How Can the FTE Model Compete with the MSP Model?:
We also cannot simply trust your assumptions if we're to properly discuss the topic. Otherwise we just become an echo chamber and nothing of value is created. Is there some resource (outside of your own articles) that gives empirical credence to your conclusions?
Here is the basis of my logic, this is an assumption so this is where I think you have to prove me wrong: An MSP staffer can act identically to an FTE in price, capability, and function making them identical in all ways to an FTE, but also has the flexibility to do other things that an FTE cannot.
Ok, why do they have that flexibility and an FTE does not?
Because an FTE cannot scale to other customers to bring the benefits of "pool resources".
But our apples to apples comparison requires an equal labor time, presence, and attention. How does the MSP provide pool resources?
You have to break down "equal or better." If you are checking to see if it can be equal, you can prove that with the "acts as an FTE" case. The pool is an option, only to be used when it is beneficial over the "acts as an FTE" case. Since it is optional only, and the other case is equal, you guarantee equal or better because we can prove the ability to always be equal.
You can't do the "equal" and the pool at the same time, obviously. But you have the option to do either.
So the only way in which an MSP is better than an FTE is that it can easily switch between "equal" and "pool'? Is that correct?
Sort of, but it isn't the switching itself that makes it better, it's the larger range of options. MSPs fully encompass all options of the FTE, but then add more. For 99.9999% of businesses, they will never switch or ever consider the FTE style option because it is so dramatically poorer in the real world.
What options are you saying that the MSP can bring that an FTE cannot? I'm trying to understand how the MSP is better than the FTE.
Everything that an MSP is known for: pooled resources, partial resources, etc. FTEs come in increments of 1. MSPs can, but don't have to. There ARE PTEs, but MSPs can do that, too, of course. But shared resources are the backbone of the MSP industry and are unique to them.
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@kelly said in How Can the FTE Model Compete with the MSP Model?:
Stuart is the IT Pro. He has his sets of experiences and skills. Assuming that he is working full time for only one organization how is he providing more value to the company within the MSP model over the FTE model?
Who said MORE. The statement is equal or better.
In your example, he's equal.
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@scottalanmiller said in How Can the FTE Model Compete with the MSP Model?:
@kelly said in How Can the FTE Model Compete with the MSP Model?:
Stuart is the IT Pro. He has his sets of experiences and skills. Assuming that he is working full time for only one organization how is he providing more value to the company within the MSP model over the FTE model?
Who said MORE. The statement is equal or better.
In your example, he's equal.
More is an equivalent statement to "or better".
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@scottalanmiller said in How Can the FTE Model Compete with the MSP Model?:
In your example, he's equal.
And the MSP will be cheaper for the company. So why pay more for equal?
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@kelly said in How Can the FTE Model Compete with the MSP Model?:
@obsolesce said in How Can the FTE Model Compete with the MSP Model?:
@kelly said in How Can the FTE Model Compete with the MSP Model?:
Stuart is the IT Pro. He has his sets of experiences and skills. Assuming that he is working full time for only one organization how is he providing more value to the company within the MSP model over the FTE model?
Stuart has the full scale of pooled resources and flexibility from the MSP that the FTE person does not have.
Now we are no longer comparing apples to apples. You're assuming that the MSP has a larger IT staff than the company. Not necessarily wrong, but an assumption that is critical to evaluating and responding to the discussion.
Kelly is correct, that would violate the apples to apples. That's a way that an MSP could be better in an "all fruit to all fruit" example, but not apples to apples.
Kelly is also right, the MSP may or may not be any larger than a single person. We must assume that it is not in the apples to apples comparison.
The only key in this niche case, is that this is the "equals" not the "or better". So it still keeps the statement true, even in this "worst case" scenario.
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@obsolesce said in How Can the FTE Model Compete with the MSP Model?:
@scottalanmiller said in How Can the FTE Model Compete with the MSP Model?:
In your example, he's equal.
And the MSP will be cheaper for the company. So why pay more for equal?
How do you come to that conclusion? Again, I'm not saying you're wrong, I am asking for the basis of your assumptions.
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@obsolesce said in How Can the FTE Model Compete with the MSP Model?:
@scottalanmiller said in How Can the FTE Model Compete with the MSP Model?:
In your example, he's equal.
And the MSP will be cheaper for the company. So why pay more for equal?
No, the MSP would not be cheaper. I mean, there is an insane theoretical case where the MSP would turn the resource into a loss leader, but that's silly and we'll discount that.
The MSP can't reasonably be cheaper, but it can be equal. I know no MSP that would take a loss on labour to get work in this way (other ways, sure.) But I do know MSPs that will do FTE equivs as a break even to get the chance of work.
So it's not that you do this to be cheaper, you do it to have "more options" without any caveats.
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@kelly said in How Can the FTE Model Compete with the MSP Model?:
@scottalanmiller said in How Can the FTE Model Compete with the MSP Model?:
@kelly said in How Can the FTE Model Compete with the MSP Model?:
Stuart is the IT Pro. He has his sets of experiences and skills. Assuming that he is working full time for only one organization how is he providing more value to the company within the MSP model over the FTE model?
Who said MORE. The statement is equal or better.
In your example, he's equal.
More is an equivalent statement to "or better".
Right, in the logical statement "equal or more" you only need either equal, or "more", to be true. In this case, it's the equal that is true. If "more" were true, then "equal" could not be true.
The point is that MSPs are always equal or better, but it seems people approach it that it must always be better, but that was never said. Only that it was always at least equal, but potentially better (and in the real world, essentially always.)
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@pmoncho said in How Can the FTE Model Compete with the MSP Model?:
@scottalanmiller said in How Can the FTE Model Compete with the MSP Model?:
I think the most important thing for people to understand here is that we are talking about a model of engagement, not different people.
Doesn't the model of MSP vs FTE imply a Many vs One scenario? This is where I am getting a little confused when trying to do the comparisons.
If the MSP is a singular person, then there are no pooled resources that belong to the individual MSP that the FTE doesn't have. I am unable to see the difference in the two other than the letters.
Right, there is no difference. That's the point. That's the equal. If the MSP has any situation other than the worst case, it falls under the "better". If it hits the worst case, it's "equal."
The point is "equal or better."
MSP doesn't mean many, and FTE doesn't really mean one (we mean it in the plural here.)
We are using the model of "resources under an MSP" and "resources under internal employment" of equal amounts.
