The Recurring Problem: A Managed Services Story–Chapter 8

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Previously – https://blog.ciaops.com/2026/08/01/the-recurring-problem-a-managed-services-story-chapter-7/

Denise Okafor called again in October, fourteen months after she’d left. Meridian Health IT, the healthcare specialist she’d switched to, had been acquired by a larger regional platform in the interim, and the transition had gone badly: her dedicated account team had been reassigned twice in five months, her monthly reporting had become generic boilerplate, and a recent phishing-simulation failure across two of her nine locations had gone unaddressed for three weeks.

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“I saw your new compliance offering mentioned by another practice administrator at a conference,” she said, sounding almost embarrassed to be making the call. “I didn’t expect Bridgepoint to have become the thing I left Bridgepoint looking for.”

The proposal Jordan walked her through six weeks later bore almost no resemblance to the flat monthly bundle Lakeside had once had. It included a named security lead who would sit in on Lakeside’s own compliance committee meetings quarterly; documented incident-response procedures with contractual response-time guarantees, backed, for the first time in Bridgepoint’s history, by a real penalty clause; and an AI usage policy specifically written for a healthcare practice where several physicians had already started experimenting with AI transcription tools without anyone’s approval.

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“What changed?” Denise asked Dave directly, at the contract signing.

“We stopped assuming that showing up mattered more than showing up for the right thing,” Dave said. “For a long time, I thought the job was being available. It turns out the job is knowing, better than the client does, what they’re actually going to need protection from next. We had to become the kind of company that could tell you that, instead of the kind that just answered the phone quickly after something already went wrong.”

Lakeside signed a three-year contract at a rate 34 percent higher than its original agreement. Denise didn’t blink.

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CIA Brief 20260802

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Microsoft 365 Copilot & AI Transformation

  • The Next Measure of AI Momentum is Work Transformed
    Microsoft argues that AI success should be measured by business outcomes and work transformation rather than raw adoption numbers. The article highlights how organisations are moving beyond experimentation and beginning to redesign business processes around AI capabilities.
    Link: View Article
  • Looking Back on Microsoft’s FY26: From AI Experimentation to Frontier Transformation
    Microsoft reflects on FY26 and positions the year as a turning point from AI pilots and experimentation toward larger-scale organisational transformation. The article highlights customer adoption patterns and the evolving role of AI across Microsoft platforms.
    Link: View Article
  • What’s New in Microsoft 365 Copilot – June 2026
    A roundup of the latest Microsoft 365 Copilot enhancements, including new features, platform improvements, and expanded experiences across Microsoft applications. The update provides insight into Microsoft’s ongoing Copilot roadmap and investment areas.
    Link: View Article
  • More Control Over Web Grounding with Domain Exclusion for Microsoft 365 Copilot
    Microsoft announced Domain Exclusion capabilities that allow administrators to limit which public web domains can be used during Copilot web-grounded responses. The feature aims to provide greater governance and control over AI-generated content.
    Link: View Article


Security & Compliance

  • CaptiveCrunch: Midnight Blizzard Targets Travellers Worldwide
    Microsoft detailed a new campaign by the Midnight Blizzard threat actor that targets travellers with malware delivery and credential theft techniques. The report outlines the threat activity and provides guidance to help organisations reduce exposure.
    Link: View Article
  • Rethinking Security for the Age of AI
    Microsoft outlines how security strategies must evolve as AI becomes embedded within business operations. The article discusses emerging risks, governance considerations, and the increasing importance of securing AI systems and data.
    Link: View Article
  • Introducing Project Perception: The Next Evolution of Agentic Security
    Microsoft introduced Project Perception, focusing on the development of more autonomous and intelligent security capabilities. The announcement explores how agents and AI-based systems may assist security operations in identifying and responding to threats.
    Link: Watch Video


Financial Results & Industry Signals

  • Microsoft Earnings Release FY26 Q4
    Microsoft reported FY26 Q4 revenue of $90 billion, operating income of $40.6 billion, and net income of $35.8 billion. The results highlighted continued strength across the Microsoft cloud and AI portfolio, with Copilot growth receiving significant attention.
    Link: View Earnings Release

After hours

Gemini Robotics 2 brings whole body intelligence to robots

https://www.youtube.com/watch?v=4lSQnrMC6nY

Editorial

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Watch out for the next CIA Brief next week

AI Is Helping People Solve the Wrong Problem Faster

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There’s something I’m seeing more and more as AI becomes embedded into everyday business processes.

People are getting dramatically faster.

The problem is that many of them are getting faster at solving the wrong problem.

Microsoft 365 Copilot can help create documents in minutes, analyse data in seconds and summarise information almost instantly. That’s impressive. But if the question you start with is flawed, all you’ve done is accelerate yourself in the wrong direction.

In my experience working with MSPs and SMBs, the biggest challenge isn’t usually a lack of answers.

It’s a lack of asking the right questions.

The Bottleneck Is Rarely Where You Think It Is

As service providers, we’re often called in to solve what a client thinks is the issue.

Their help desk is overloaded.

Sales aren’t growing.

Projects are delayed.

Customer enquiries aren’t being answered quickly enough.

The temptation is to jump straight into fixing the symptom.

Now AI makes that even easier.

A client says they need faster reporting. Copilot helps generate reports in minutes.

A manager says they need more customer communications. AI drafts them in seconds.

A business owner says they need more leads. AI builds marketing content all day long.

But what if none of those things are actually the constraint?

I’ve seen businesses spend months optimising processes that had almost no impact on growth because they were focused on the visible problem rather than the real one.

AI simply helped them arrive at the wrong destination faster.

Better Questions Create Better Outcomes

One of the most valuable uses of Microsoft 365 Copilot isn’t generating content.

It’s helping people think.

The organisations getting the most value aren’t treating Copilot as a faster keyboard. They’re using it as a tool to challenge assumptions and examine the business from different angles.

When someone tells me they have a problem, I often start with three simple questions:

  • Where are you now?

  • Where do you want to go?

  • What do you believe is stopping you?

Those questions sound basic, but they’re surprisingly revealing.

Recently I spoke with a business that was convinced slow customer response times were hurting growth. Their team wanted AI to automate messaging and increase communication volume.

After stepping back and examining the process, the real constraint wasn’t messages.

It was capacity.

There simply weren’t enough qualified people available to deliver the service being sold.

Automating communications would have made customers happier for a short period while simultaneously increasing pressure on an already constrained delivery team.

The wrong problem.

Another business owner believed lead generation was the issue. They wanted AI-generated marketing campaigns, social media content and automated outreach.

The reality?

Their existing funnel already produced enough opportunities.

The bottleneck was conversion.

Improving close rates by a small percentage would have generated far greater revenue than doubling marketing activity.

Again, the wrong problem.

Copilot Should Challenge Thinking, Not Replace It

This is where I believe many MSPs have an opportunity.

Too many AI conversations revolve around features, prompts and automation.

Those things matter, but they’re not the real value.

The real value comes from helping clients identify what actually constrains growth, profitability or productivity.

Copilot gives us the ability to analyse information faster than ever before. It can surface patterns, summarise discussions and identify trends that would otherwise take hours to uncover.

But someone still needs to ask the right question.

As MSPs, that’s where our experience becomes critical.

The businesses that will benefit most from AI won’t necessarily be the ones with the most advanced technology. They’ll be the ones with the clearest understanding of their business challenges.

AI can provide answers almost instantly.

What it can’t do is determine whether you’re asking the right question in the first place.

The Real Opportunity

Before using Copilot to generate another report, automate another workflow or create another piece of content, take a step back.

Define where you are.

Define where you want to go.

Identify what you genuinely believe is standing in the way.

Then challenge that assumption.

Because in many cases, the biggest business breakthrough doesn’t come from getting a better answer.

It comes from discovering you’ve been asking the wrong question all along.

And that’s a mistake AI can help you make much, much faster.


The Recurring Problem: A Managed Services Story–Chapter 7

Previously – https://blog.ciaops.com/2026/07/31/the-recurring-problem-a-managed-services-story-chapter-6/

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The transformation that followed took the better part of eighteen months, and it was messier and slower than any tidy retelling makes it sound. Priya led it, with a whiteboard in her office that eventually filled an entire wall.

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The first and hardest change was financial. Bridgepoint stopped selling hourly project work as its default and began requiring every new client, and every renewing one, to move onto a tiered managed-services contract with a three-year term — not because Priya loved locking clients in, but because Renata’s numbers had made the logic unavoidable: longer, deeper contracts weren’t just more predictable, they were worth measurably more, and clients who wouldn’t commit to a real partnership usually weren’t clients worth keeping anyway. It cost Bridgepoint two accounts that flatly refused the new terms. It gained the company, within a year, a recurring-revenue base that had climbed from 46 percent to 71 percent of total revenue, on its way toward the 85-percent target Priya had written at the top of the whiteboard and circled twice.

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The second change was strategic focus. Rather than continuing to be everything to everyone, Bridgepoint made a deliberate bet on two verticals where it already had real experience: healthcare and light manufacturing. It hired a part-time compliance consultant with a HIPAA background, built a documented incident-response playbook mapped explicitly to healthcare regulatory requirements, and began marketing itself, for the first time in its history, as something other than a friendly generalist. The pitch decks stopped saying “we support any business” and started saying “we understand what a HIPAA auditor is going to ask you, because we’ve already answered it forty times.” Pricing for the healthcare tier came in meaningfully higher than the old flat rate — clients paid it without much argument, because for the first time, the price reflected expertise they could see, not just hours they were trusting someone to bill honestly.

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The third change was the one Tom Baptiste’s plant-manager scare had made unavoidable: Bridgepoint built an actual AI governance offering, something that hadn’t existed anywhere in its service catalog eighteen months earlier. It started small — a one-time “AI readiness assessment” that inventoried every AI tool a client’s employees were already using, sanctioned or not, and flagged where sensitive data might be leaking to public tools nobody in leadership had approved. It grew into an ongoing service: written AI usage policies tailored to each client, ongoing monitoring for unsanctioned tool use, and, for the healthcare and finance clients who needed it, documentation aligned with emerging frameworks their own auditors were starting to ask about. It was Aisha’s idea, developed with a compliance consultant Priya brought in, and it became, within a year, one of the highest-margin services Bridgepoint had ever sold — not because it required expensive infrastructure, but because it required exactly the kind of judgment Jordan and his fellow senior technicians actually had, applied to a problem clients didn’t know how to solve themselves.

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“We spent eight years being the people who fixed what broke,” Priya said, at the leadership offsite where she presented the first full year of results. “We’re spending the next eight being the people who tell clients what’s about to break, and what they’re not allowed to plug into their network without asking us first. That’s a completely different business. It just happens to be run by the same people.”

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Why I Wrote Is the Traditional MSP and TSP Business Model Becoming Obsolete?

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Over the last few years I’ve had the same conversation with MSP owners dozens of times.

It usually starts with a variation of the same question:

“We’re still growing, so why do people keep telling us our business model is under threat?”

It’s a fair question.

Most MSPs are not seeing clients disappear overnight. The demand for technology remains strong. Microsoft 365 continues to expand. Security requirements continue to increase. Businesses still need trusted advisers to help them navigate increasingly complex technology environments.

So why the concern?

Because I believe many MSPs are measuring the health of their business using indicators that are becoming less relevant.

That belief is what led me to write Is the Traditional MSP and TSP Business Model Becoming Obsolete? The report examines the growing gap between providers that are adapting to AI, automation and changing customer expectations, and those that are still relying on assumptions that worked a decade ago.


The question isn’t whether MSPs survive

One of the biggest misunderstandings in the market today is the idea that MSPs are somehow disappearing.

I don’t believe that completely.

In fact, I believe businesses will need trusted technology partners more than ever.

What I do think is disappearing is the value attached to many traditional activities that MSPs have historically relied upon.

Routine administration is becoming increasingly automated.

Security expectations are rising.

Clients are becoming more outcome focused.

AI is changing how work is performed inside both customer organisations and service providers.

The real question is not whether MSPs survive.

The real question is whether the way many MSPs currently operate remains commercially attractive over the next decade.

That distinction matters.


Why I decided to research the issue properly

There is no shortage of opinions about AI and the future of managed services.

Unfortunately, there is also no shortage of hype.

I wanted something different.

I wanted evidence.

I wanted current financial benchmarks, analyst forecasts, industry data, acquisition trends and market observations pulled together into a single document that leaders could use to make strategic decisions. The publication is positioned as an evidence-based strategic report focused on AI, automation, platform shifts and their impact on MSPs and TSPs. [directorci…umroad.com]

Most importantly, I wanted a resource that challenged both sides of the argument.

The report doesn’t simply assume every traditional provider is doomed. Nor does it assume technology will magically solve every business problem.

Instead, it looks at what is actually happening in the market and asks a more practical question:

“What would a successful MSP look like in 2030?”


What readers will gain

When I speak with MSP owners, many are wrestling with the same strategic challenges:

  • How does AI affect our service model?

  • What happens when automation reduces labour requirements?

  • How should we price services in the future?

  • Where does Microsoft Copilot fit?

  • What capabilities should we invest in now?

  • How do we increase the value of our business?

Those are boardroom questions, not technical questions.

The report explores these issues and examines why security, AI-enabled services, automation and outcome-focused engagements are becoming increasingly important growth areas. It also discusses transformation approaches and includes a practical action framework aimed at helping providers prepare for the future. [directorci…umroad.com]

As someone who spends a large part of my time helping organisations get ready for Microsoft 365 Copilot, I see a similar pattern everywhere.

Technology is no longer the difficult part.

Change is.

The providers that learn how to guide customers through governance, security, productivity and AI adoption will have an advantage that goes well beyond technical expertise.


This report is really about decisions

At its core, this publication is not a technology report.

It is a business strategy report.

It is designed for MSP owners, technology service providers, Microsoft partners, consultants and investors who want a clearer view of where the industry is heading and what actions may be required to remain competitive. [directorci…umroad.com]

If you already believe everything is fine, the report may challenge your assumptions.

If you are worried about the future, the report may give you a clearer framework for evaluating your options.

Either way, my goal was to provide a practical, evidence-based resource that helps leaders make better decisions during a period of significant industry change.

Because the biggest risk facing most MSPs today is not AI.

It’s assuming tomorrow will look enough like yesterday that no meaningful change is required.

If you’re serious about understanding where managed services may be heading over the next decade, I believe this report will be a worthwhile investment.

Learn more here: Is the Traditional MSP and TSP Business Model Becoming Obsolete?

Stop Optimising the Marketing and Start Designing the Experience

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When businesses look for growth, the first instinct is usually to focus on marketing. Better campaigns. More content. Smarter advertising. More leads.

I get it. Marketing is visible. It’s measurable. It feels like progress.

But the more I work with Microsoft 365 Copilot and watch how organisations are adopting AI, the more I think the bigger opportunity sits somewhere else entirely.

The opportunity is in the experience.

Most businesses spend a lot of energy trying to attract new customers, yet leave many of their day-to-day interactions to chance. The welcome email gets written once and forgotten. Sales conversations follow whatever path the presenter chooses on the day. Meeting follow-ups vary depending on how busy people are. Customer interactions become inconsistent because everyone is moving too fast.

The result isn’t usually catastrophic. It’s just forgettable.

That’s where I believe Copilot can have a much bigger impact than many people realise.

When people talk about Microsoft 365 Copilot, they often focus on productivity gains. Saving time in Outlook. Creating documents faster in Word. Summarising meetings in Teams.

Those are valuable benefits, but I think they’re only the starting point.

The real value appears when organisations use that saved time and improved consistency to deliberately design better experiences.

I encourage businesses to walk through their customer journey from beginning to end.

What happens after the first enquiry arrives?

What does the first response look like?

What information does the customer receive?

What happens after the sales call?

What happens after the workshop?

What happens after the project goes live?

Every one of those touchpoints creates an impression. Every one contributes to the story a customer eventually tells someone else.

Copilot gives organisations the ability to think more intentionally about those moments.

Instead of rushing through administrative work, teams can spend more time refining communications. Instead of producing meeting notes hours later, summaries and action items can be delivered while conversations are still fresh. Instead of every proposal sounding slightly different, organisations can build a consistent voice across the business.

I’ve seen businesses use Copilot to create follow-up material that customers genuinely find useful rather than simply ticking a box. I’ve watched teams capture discussions more accurately, identify commitments more clearly, and reduce the chances that important details disappear into someone’s notebook.

None of that feels particularly dramatic.

Yet that’s often where the biggest improvements happen.

Customers rarely remember that you used the latest technology.

They remember how easy you made things.

They remember whether you followed through.

They remember whether interactions felt organised, professional, and considered.

That’s the theatre many businesses overlook.

Not theatre in the sense of being artificial. Theatre in the sense of carefully designing moments that leave a positive impression.

A prompt response that references the conversation accurately.

A meeting recap that makes the next step obvious.

A proposal that addresses real business outcomes rather than generic marketing language.

A workshop where participants feel heard because insights are captured and reflected back immediately.

These experiences don’t happen by accident. They happen because somebody took the time to design them.

What excites me about Microsoft 365 Copilot is that it creates space for exactly that kind of thinking.

When less energy is spent on repetitive work, more energy can be invested in improving quality, clarity, and consistency. The conversation shifts from “How do we get through today’s workload?” to “How do we create a better experience?”

That’s a far more interesting question.

As AI becomes increasingly common, simply using the technology won’t be a differentiator. Everyone will have access to similar tools.

What will differentiate organisations is how they apply those tools to create experiences that people remember.

So instead of only looking at your marketing funnel, take a walk through your entire business.

Look at every email.

Every meeting.

Every document.

Every customer interaction.

Then ask yourself a simple question:

Which of these moments deserves a little more attention?

My experience is that the organisations getting the most value from Copilot aren’t just working faster. They’re using the opportunity to make every interaction a little better.

And that’s a story customers are far more likely to tell.

The Recurring Problem: A Managed Services Story–Chapter 6

Previously – https://blog.ciaops.com/2026/07/30/the-recurring-problem-a-managed-services-story-chapter-5/

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Dave called Aisha into his office the following Monday, alone, no leadership meeting audience. “Tell me honestly,” he said. “If we actually did this — really did it, not a five-hundred-ticket trial license — what would it take, and what would break?”

Aisha, to her credit, didn’t gloat. She pulled up a proposal she’d apparently been quietly refining for months on the assumption nobody would ever ask to see it. A tiered rollout: automated triage and resolution for the top eight ticket categories that accounted for nearly sixty percent of volume; predictive monitoring that could flag failing hardware and unusual network behavior before clients ever noticed a problem, instead of after; and, critically, a real security escalation path with automated paging, not a shared inbox and a prayer.

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“What would it take?” she said. “Budget, about $140,000 in tooling and integration over the first year. What would break — that’s the harder question. Not the technology. The technology works; I’ve been running the proof of concept for months and the failure rate on auto-resolved tickets is under two percent, and every one of those gets caught and escalated to a human, not silently dropped. What breaks is the team, if we don’t handle this right. Jordan thinks this is about replacing him. It isn’t. But if we don’t say that out loud, clearly, more than once, he’s going to be right to be angry, because nobody will have told him otherwise.”

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Dave took that seriously enough to have the conversation with Jordan directly, which was, in its own way, harder than the conversation with Renata Cole had been. They sat in the break room after hours, two coffees going cold.

“I’m not going to pretend some of this doesn’t automate work you currently do,” Dave said. “It does. Password resets. Basic troubleshooting. The stuff that’s been eating your week. What I need from you isn’t to compete with it. It’s the thing it can’t do — sit with Tom Baptiste and tell him honestly what his plant manager’s AI habit is going to cost him if nobody manages it, or walk into a room with a healthcare compliance officer and speak their language because you’ve done it for eleven years. I can’t automate the part where clients trust you. I can only automate the part where they don’t need to wait nineteen hours for a password reset while they’re deciding whether they still do.”

Jordan didn’t answer right away. “So my job changes,” he finally said. “From doing the work to explaining the work.”

“Your job changes from being the guy who shows up,” Dave said, “to being the guy clients call before they know they have a problem. That’s a better job than the one you have now. It’s just not the one you were trained to think you were signing up for.”

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It wasn’t a clean resolution. Jordan stayed skeptical for months, and two of Bridgepoint’s other senior technicians left over the following year — one retired early, one took a role at a competitor that hadn’t changed anything and, as far as anyone could tell, was quietly struggling because of it. But Jordan stayed, and by the following spring he had become, somewhat to his own surprise, the person clients most wanted running their onboarding calls for the company’s new security offering, because he was the one person in the building who could explain, in plain language and without a sales pitch, exactly why it mattered.

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