My Tech Videos 2026

The world is all about not what you know but who you know. This book explains exactly how this works and how to use it to your advantage. A lot of Gladwell’s writing have been called into question of late. Even so, putting aside the example he uses, I think the concept surfaced have great merit.

4. The Four Hour Work Week – Tim Ferriss

Many people believe this book is about shirking responsibility. It is in fact a blueprint for how to free up your time to do things you want and enjoy. It will challenge the way you look at your career. This book has become some what dated so ensure you get the latest revised edition. Again, I would suggest you read this and consider the 30,000 foot view of challenging many people pre-conceived concepts about career. The ability to do anything, anywhere these days has never been truer.

5. Secrets of the Millionaire Mind: Mastering the Inner Game of Wealth – T. Harv Eker

The successful are defined by a different mindset. This mindset can be learned. It can be trained. This is a great book to show you how to do just that.

6. Talent is over rated: What Really Separates World-Class Performers from Everyone Else – Geoff Colvin

Demonstrates that the best comes from implementing a system. Having a system allows you to focus on the right thing and do that work that is required. If you want to take yourself to an elite level, beyond just good, then read this book.

7. Book Yourself Solid: The Fastest, Easiest, and Most Reliable System for Getting More Clients Than You Can Handle Even If You Hate Marketing and Selling – Michael Port, Tim Sanders

You can’t survive in business without a steady flow of customers. Selling to people is the wrong approach, you instead need to attract them to your business. This book helps you achieve exactly that.

8. Profit First: A Simple System To Transform Any Business From A Cash-Eating Monster To A Money-Making Machine – Mike Michalowicz

Business is about making a profit. This then gives you the freedom to do what you want with that profit. This book helps you focus on profit and setting up systems to make the most of the profit you generate.

9. Barking Up the Wrong Tree – Eric Barker

Conventional wisdom does not always apply and in some case can actually be detrimental. Challenging what is taken for granted should be in the play book of everyone who wants to achieve at the highest level. Important lessons can be learned in the strangest places and form the strangest people. Have an open mind and you might be surprised at what you have believed to be bad in fact turns out to get just what you need.

10. Unbeatable Mind: Forge Resiliency and Mental Toughness to Succeed at an Elite Level – Mark Divine

Another mindset book. Business is not always going to be easy or take the intended route. This is when you need to have the determination to see your plans through to success. This book shows you how to develop the mental toughness to make this happen.

11. Mastery – Robert Green

Excellent read with lots of great strategies to take away. Excellence is not a talent it is a skill. That means that it takes hard work to achieve, but hard work is available to everyone, yet few choose the path. There is no secret to Excellence, it is something only time and effort will reward you with and iof you choose that path you’ll be one of the few.

12. Tools of Titans – Tim Ferriss

There are few books that take the learnings for so many exceptional people and puts them at your fingertips. This is one such book that packs a lot of business and life learnings between the covers.

13. Predictably Irrational: The Hidden Forces that Shape our Decisions – Dan Ariley

Although we like to think logic and rationality rule our world emotion is by far the more powerful influence. Understand this in the context of business and you are well on your way to understanding why people make the decisions they do and how to best profit from them.

14. Extreme Ownership – Jocko Willink and Lief Babin

Moving beyond blame is tough. This book illustrates the ownership of the problem and the environment is a key to success in the military or in business. It is a path few will elect to take voluntarily, however more may do so after reading this.

15. Peak Performance: Elevate your game, avoid burnout and thrive with the science of success – Brad Stulberg

Success is largely about developing a winning system. This book show you how to approach that pragmatically. If you want to see results use this book to help you build the system.

16. Blink: The Power of Thinking Without Thinking – Malcolm Gladwell

The older you get the more experience you get. This experience is aggregated in your ‘gut feel’. Trusting your ‘gut’ may not appear rational but this book will help you understand why it is in fact your best option in many cases. Again, take Gladwell’s examples with a grain of salt but the message is still relevant.

17. The Now Habit: A Strategic Program for Overcoming Procrastination and Enjoying Guilt-Free Play – Neil A. Fiore

Plenty of great productivity learnings in here that help you take action. It shows you how to focus on the right stuff in the right priority. Even if you are not a major procrastinator there is plenty in this book that you can take away.

18. The One Thing – Gary Keller

Multi-tasking is a myth. Focus is the key to success to bringing all your resources to bear in unison makes a hell of a lot of difference. Most people can’t do it, so those that can stand a much greater chance of success.

19. Deep Work – Cal Newport

Distractions are wasted energy and time that you’ll never get back. You’d be amazed at how distracting the modern world is. If you can minimise these distractions you can focus more and be far more productive.

20. The E-Myth – Michael Gerber

The classic on ‘procedurising’ your business and creating a structure that doesn’t need you to survive. The simple secrets inside this book can transform any business from hardship to joy.

Let me know what you think. Do these work for you? What’s your top business reads? I’d love to hear.

Some other business books that I read that may be worth considering:

– AI Valley: Microsoft, Google, and the Trillion-Dollar Race to Cash In on Artificial Intelligence – A Definitive Insider Chronicle of the Breakthroughs Redefining Our World – Gary Rivlin

– Chip War: The Fight for the World’s Most Critical Technology – Chris Miller

My software and services – 2026

startup-photos

Here’s last year’s post for comparison:

My software and services – 2025

My PC’s are either running the latest version of Windows 11 (24H2) without any issues. I no longer run any Windows Insider builds as I had trouble backing out of these when I needed to. I still have Office Insider builds happening in my environment.

All Windows machines are directly joined to Entra ID and managed via Intune and Microsoft Endpoint Manager, except for one that remains stand alone for use with my IoT projects. The Entra ID connected configurations are based on the Windows MDM security baseline settings. All machines only use Windows Defender for local security monitoring and management. Thanks to Microsoft E5 on my production tenant, I am also using Microsoft Defender For Endpoint at the back end for monitoring and investigation of endpoint threats.

My two main tenants are Microsoft 365 E5 demo and Microsoft 365 E5 production environments. The production Microsoft 365 tenant has Microsoft 365 Business for all users except myself. I have a Microsoft 365 E5 license on which I have configured all the services including integrated PSTN calling via Switch Connect.

I use Microsoft Sentinel to monitor threats across my environments via a single pane of glass. I have also now added Defender EASM for monitoring security threats. Failed login attempts by country in the last 30 days from sentinel look like:

I use the following major browsers:

– Edge – my primary browser across all my devices including iOS and Android. I have it locked down with baseline policies via Microsoft Endpoint Manager.

– Brave – I have become increasingly concerned about the surreptitious tracking that many sites perform, especially when it comes to social media sites. I therefore now do all my ‘random browsing’, searching and viewing of social media sites using Brave. I also like that Brave allow me easy access to Tor browsing for anonymous security work.

I have now cranked Edge up to the maximum security level but wanted to isolate the most likely tracking culprits into another browser that was security focused. After some evaluation, I have chosen Brave to be this browser. This is now where I do all the stuff that is more likely to be tracked and now hopefully blocked or at least minimised. I have also set this browser up to use Duck Duck Go for search, otherwise I use Bing for my production Edge browser. I have completely eliminated Google Chrome from all my machines without any issues and recommend those who are becoming more concerned about their privacy, like me, do the same.

Services like SharePoint Online and OneDrive I use regularly both in the demo and production tenant. I have the OneDrive sync client installed, running and connected to various locations on my production and demo tenants. I can now sync across all my different tenants as well as my consumer OneDrive storage. I have common places pinned to my Windows Explorer Quick access, which I find to be a real time saver.

I regularly use Microsoft Teams which is now my main messaging application and I’m using the new Teams client. All the CIAOPS Patron resources like the intranet, teams, etc all reside in the Microsoft 365 E5 demo tenant but I connect to it on my desktop normally via an Azure B2B guest account from my production tenant. Thus, I can admin the Patron resources in a browser if need be but I get the same experience on my desktop as any Patron would. Handy to know what works and doesn’t work with Microsoft Teams guest access. Thanks to Microsoft E5 and Switch Connect, I also have Teams connected as a phone.

I use Lastpass to keep my passwords and private information secure. It allows me to do things like generate and store unique passwords for each website that I sign up for. It is also available across all browsers on my machine (including Microsoft Edge). I also now also use Lastpass to store secure notes. I accept recent security breaches with Lastpass generate concerns but after some investigations I believe the risk for myself is minimal and as yet don’t feel a need to switch. If I am going to change at any point I think I’d be going with Bitwarden but that hasn’t been necessary as yet.

The extensions I run in all my browsers are:

– LastPass

– Duck Duck Go Privacy Essentials

I use Microsoft Power Automate for automation as well as Azure Functions.

For my email newsletters I use Mailchimp.

My preferred public social networks for business, in order are:

1. X

2. Linkedin

I would suggest that no matter what social media service you elect to use that you should spend time customising what you see. Unfiltered content is distracting but you can get good results if you spend just a little time telling the service what you do want to see I have found. Thus, don’t accept the defaults. You CAN customise what is presented to you.

I consume a lot of content from YouTube both for business and personal interest. I also also use YouTube extensively for my publicly available training video training.

Microsoft Office desktop software is still part of my everyday workday via applications such as Outlook, Word, Excel, PowerPoint, etc. I use the desktop version of Outlook on my Surface Pro 7 which lives on my desk but I only use Outlook Web App on my travelling Surface Pro 9 device. I could happily not use Outlook on the desktop any more I believe but I still use so I understand the experience for most users. However, I do see the day when Outlook on the desktop begins to lose its appeal.

Currently, I use both classic Outlook and New Outlook on various desktops without too much issues. I prefer classic Outlook but New Outlook has come a long way and added many of the capabilities I use in Classic Outlook. The missing piece for me still is the way to customised New Outlook to see emails, calendar and tasks all on a single page, which I don;t believe New Outlook supports just yet. I appreciate that Microsoft will soon be forcing everyone to New Outlook and I believe my soul is prepared for this transition when it comes.

The key application from the suite for me is OneNote. OneNote is my go to Swiss Army knife for just about everything digital. I use it to capture all sort of data. I even use it as a diary as I have detailed previous here:

One of the ways I use OneNote

The reason OneNote is key is because:

1. Just about everything I put in there us searchable

2. It is freely available across all platforms.

3. All my information is synced and accessible on all devices.

4. It is available on the web or offline if needed.

I am a big user of OneNote on my mobile devices. This combination has allowed me to totally eliminate my paper notebooks for things such as journaling.

I am now a big Microsoft To-Do user. I use it to keep many tasks and items that I need to follow up including when bills are due. I love how it is available on all my devices and syncs across them all as well.

I use Windows terminal now for things like PowerShell execution and Microsoft Whiteboard for demonstrations and training.

Another key service I use everyday along with Microsoft 365 and OneNote is Azure. Typically, I use it for running up virtual machines that I test various things with but I also use it with my IoT projects.

There is just so much that can be done with Azure and I pretty much use it everyday.

All of my data now lives in Microsoft 365 protected with things like Windows Information Protection and other Microsoft information protection options. All my Windows machines run with full disk encryption thanks to Bitlocker.

I have implemented Windows Defender Application Control (WDAC) to provide application control to improve security in my environment.

To capture my desktop for my online training academy or my YouTube channel I use Camtasia. I use SnagIt to capture screen shots and add highlights and emphasis to these. Snagit allows me to capture complete screens or specific areas quickly and easily. I will admit that I am using this software less and less now. It is simply too slow to get running. We’ll see. The standard Windows apps are much faster and tend to be what I use to capture screen information.

I use Microsoft Teams to record my podcasts, which I then produce with Camtasia. These are uploaded to Podbean where they syndicated across various network.

To compose and publish blog articles I use Open Live Writer. My blog lives on WordPress.com.

My web site and Battlefields site live on Squarespace.

The majority of images I now generate directly using Microsoft Copilot.

I use Visual Studio Code in which I do most of my PowerShell editing and publishing. I also use it now for my IoT projects. The end result typically is my GitHub repository where you will find a range of scripts and other resources that I maintain regularly. With Visual Studio Code I can edit publish and sync all my machines and my GitHub repository no matter where I am. Very handy.

Here are also a few of the other items I use regularly that are not for business:

Amazon Prime Video – Most of this viewing is now on my iPad mini and I am looing forward to the next series of Clarkson’s Farm.

Audible – Probably the most used app on my iPhone. I listen everyday, especially when I am travelling interstate or even in the car. I can highly recommend my last read – Mr Wilman’s Motoring Adventure: Top Gear, Grand Tour and Twenty Years of Magic and Mayhem

NetFlix – Currently watching Mark Rober’s Crunchlabs

Duolingo – language, maths and music learning, Japanese and Italian at the moment but most of this access is now on my iPad mini.

WaniKani – Helping me learn Japanese characters

Kindle app – for typically reading books on my iPad

I try and keep my production machines as ‘clean’ and free of unused software as possible. I ensure that they are updated regularly. Any software testing that I need to do is typically done on a virtual machine in Azure.

A new section I thought I’d add is the AI that I use. The common Ai I use by far is GitHub Copilot. i use this daily to assist with coding tasks like creating PowerShell scripts and writing KQL queries amongst other things. Even though I have a paid version of GitHub Copilot I am happy to say there is also a free version that you can take advantage of and the details are here.

I have a subscription to Microsoft 365 Copilot which I have had now for about 2 years. I use this every day, but especially with Teams and Stream to summarise videos and other content. I also use Copilot Studio to create custom agents which I and others use inside the Microsoft Teams I manage.

The main non-Microsoft AI that I use is Perplexity even though there are some ‘ethical’ challenges around this service. I signed up for Gemini Enterprise because i wanted access to an AI that is separate from GPT models. Gemini also doesn’t run on NVIDIA chips so it give me a counterpoint to the ‘standard’ most people use. I use Claude regularly when working with code and ChatGPT is also something that I use now and again as I have found it to be the poorest of all the consumer AI services.

I think I’ll have to start doing an annual post on what AI services I use and why.

So there you have it, the major software and services that I use regularly. I continue to search out additional software that will improve my productivity. If you use something that you’ve found really handy, please let me know and I always keen to explore what works for others.

My Gear 2026

You can take a look back at last year’s gear here:

My Gear 2025

there were/are some major changes happening with my assortment.

iPhone 12 Pro Max – This remains my main mobile device still. It still has a number of cracks on the screen but it still does what it needs to do. The device lives in a Quad Lock case and I have Quad Lock mounts for both desktop and car, which I highly recommend and make life easy.

I have still not been able to justify the upgrade to a newer iPhone. No apps I use demand it and I can’t see that I am really missing out on anything by staying where I am. Yes, there has been another new iPhone but is a $2K+ cost warranted? Nope.

One thing that remains configured my iPhone for is default grey scale display. I do this for two major reasons, firstly to prevent the phone from grabbing and holding my attention and secondly to save power. With the colours disabled on your phone it is amazing at how les tempting it is to play with it and use it as a crux when you are bored.

The great thing I will say about about Apple devices is their battery life. My experience is that this allows them to work for years and years, providing great value.

So for now, unless this device breaks, I’m in no rush to replace it.

Surface Pro 9 – This is my travelling and demo machine and replaces the Surface Pro 6. Having a dedicated travel machine makes it easy to grab and also to only have the software on it that I need. By that I mean I’m not installing random stuff on it to test.

I like the size and also the fact that it comes with with a Surface pen, which is handy as I discovered that the Surface Pen also works on Surface Hubs! (Great when the Surface Hub pens don’t work).

The device has a Samsung ViewFinity S70D 32″ 4K UHD VA Panel HDR 10 Monitor attached, which I bought last year to provider high resolution. The previous Samsung 32 Inch S39C FHD Curved Monitor (1920×1080) monitor has been moved to my Surface Pro 3 for IoT work.

I do most of my demos on this machine as well as Teams webinar work as it is nice and quick. This machine runs Windows 11 Enterprise.

While this machine powers on, I again, can see no reason to shell out probably close to $3K for a new device.

Surface Pro 7 – This is my main desktop machine. Being the same form factor as the Surface Pro 6, it just slotted directly into my Kensington SD7000 Surface Pro Docking Station I already have in place. This machine runs Windows 11 Enterprise.

This device has a Acer CB281HK 28″ LED LCD monitor as well as a small Samsung connected to it. This makes things really handy when doing webinars.

The downside of going to another Surface device is that it won’t fit in my Kensington SD7000 Surface Pro Docking Station which I really love. So if I upgrade this machine, I need to do away with the docking station as well.

I can’t see me replacing this device in 2026 unless it totally fails.

Surface Pro 6 – My backup machine in case my main machine fails or is unavailable for some reason. This machine run Windows 11 Enterprise and only gets turned on occasionally.

This machine is becoming noticeably slower to work with and takes much longer to boot up and run applications. Once these are all ‘fired up’ it is fine, but it is noticeably slower than the more modern Surface machines I have.

Surface Pro X – I use this machine as a ‘lite’ travelling desktop as well as a whiteboarding machine for demos and training. Give that it comes with the Surface Pen and has a nice large screen and will lie flat it makes the prefect device for scribing. I also use this device for writing note into places like OneNote. Perhaps not the most effective use of the device but it beats the iPad when it comes to scribing hands down in my books. This machine runs Windows 11.

Surface Pro 3 – Continues to work fine and function as a test machine in my production environment. This machine has now been removed from my production network and operates stand alone. It does this so it can run my IoT project work. I found that with the security I have on my production network that I could not easily operate the IoT software I needed so the simple solution was to remove it from the production network and use it stand alone. This machine is slow and clunky, but for now it is doing the job it needs to. This machine is not suitable for Windows 11 and thus still happily runs Windows 10.

This device now has the Samsung 32 Inch S39C FHD Curved Monitor (1920×1080) monitor connected to it make code much easier to read and work with.

Surface – I have had an original Surface version 1 for many years now. The keyboard has long since broken by the system still works fine, although somewhat under powered with only 4GB of RAM. This machine is now a dedicated device on a separate test tenant. This allows me to test Autopilot and other settings on it regularly. This machine is not suitable for Windows 11.

iPad mini 5th Gen – I decided I wanted a smaller ‘notebook’ size table to use like a paper diary, amongst other things, so I went out and bought an iPad mini.

I also now use this iPad mini with the Apple pencil, which generally works well, although the Apple pencil battery is pretty much knackered. The secret is to get a good case for both the iPad mini and the pencil. My choice was:

Finite Case with Pencil holder

which I’d certainly recommend as it is flexible, tough and cheap.

After a number of years the Apple Pencil doesn’t really hold a charge any more. That is disappointing, although I appreciate it doesn’t have a huge battery. This has again increased the friction with me finding a suitable replacement for a paper notebook because every time I want to write something down, I need to charge the pencil up which takes ages.

Here is another device that works well and really has no need of a replacement but I have considered upgrading to a current iPad mini but again, I’m struggling to justify the AU$800 cost when the existing device is more than fit for purpose. Even if I did buy a new iPad mini what would I do with the current device?

D-Link Wireless N300 Model Router DSLG225 – to allow connect to the NBN broadband network.

Ubiquiti – I have a variety of Ubiquiti equipment in place including a Security Gateway. All these have worked flawlessly and I can’t recommend this gear highly enough.

Docking station – I still love my Kensington SD7000 Surface Pro Docking Station. It is a really neat device, that suits most modern Surface Pro devices. It is slim, compact and now allows me to have 3 external monitors off the one Surface devices (as you can never have enough screen now can you eh?). I can plug in all my devices, microphones, phones, etc to it and all the cables are hidden at the back. I also like that you can adjust the screen up and down, a bit like a Surface Studio.

If I did upgrade my Surface pro 7 device it could not be used with this docking station which would be sad. Seems to me all the docking station form factors have moved to just being external bricks rather than the elegance this solution provides. being unable to use this docking device upon a device upgrade is a major reason preventing me from upgrading if I’m honest.

The original Kensington SD3500v has now moved to work with the Surface Pro 3 and that is also working well

My gear remain pretty much the same and functioning reliably. I’ve survived another year with teh same kit, meaning I have not shelled out for new kit. When the old stuff does the same and the new stuff, why waste money right?

I no longer have a frontline Android phone, but the longer I go without it the more I wonder whether I do in fact need it? if so, I could always buy it, but until then it can go on the back burner. The major investment in 2025 was a higher resolution screen for my Surface Pro 9.

Keeping things simple works best I believe.

My Stuff 2026

This post is my annual post aimed at bringing the links to everything I have out there on the Internet together into a single place. Here we go.

About me

Summary – http://about.me/ciaops
Website – http://www.ciaops.com/
Email – director@ciaops.com
Microsoft Teams – admin@ciaops365.com

Social Media

Linkedin – http://www.linkedin.com/in/ciaops
X – https://www.twitter.com/directorcia
Facebook – http://www.facebook.com/ciaops
Instagram – https://instagram.com/directorciaau

Free Stuff

Regular technical and business information, tutorials, walk throughs, learnings, upcoming courses and more.

Blog – http://blog.ciaops.com

Here you’ll find currently almost 200 videos full of tutorials on SharePoint, Office 365, Azure and technology.

YouTube – http://www.youtube.com/user/directorciaops

Presentations and whitepapers for free download.

Github – https://github.com/directorcia/general/tree/master/Presentations

Documentation for older versions of SharePoint on premises, especially the free versions and those that came with SBS.

Windows SharePoint Operations Guide – https://github.com/directorcia/general/tree/master/Archive/WSSOPS

I have number of free GitHub repositories that include things like PowerShell scripts, pricing calculators, reference documents, helpful links and more. You will find all these at:

https://github.com/directorcia/

I maintain a GitHub repository that contains not only links to articles on best practices for services like Exchange Online but also contains configuration files and settings typically in JSON format that can be imported and used to configure your Microsoft 365 environment. You will find all that here:

https://github.com/directorcia/bp

With over 350 episodes and now in it’s 16th year, my podcast focuses on providing you news and updates from the Microsoft Cloud around Microsoft 365 and Azure.

Need to Know podcasts – http://ciaops.podbean.com

You can subscribe using iTunes or Spotify. If you’d like to be a guest or know someone who would, please let me know.

Need to Know webinars are held monthly and announced on my blog. These are conducted using Microsoft Teams on a topic around the Microsoft Cloud.

You can join my free Teams shared channel. To do so follow the instruction here:

https://blog.ciaops.com/2022/07/29/join-my-teams-shared-channel/

here you’ll find a forum on the Microsoft Cloud along with up to date news and information.

I publish a weekly round up of Microsoft Cloud news in my CIA Brief here on my blog:

https://blog.ciaops.com/tag/cia-brief/

I also have an email list you can join here:

https://forms.office.com/r/TGupLS0fKr

You can get answers to Microsoft 365 questions via AI grounded on my knowledge by sending your question in the BODY of an email to:

robert.agent@ciaops365.com

Be patient, a response by return email will take a couple for minutes.

Commercial stuff

This stuff helps pay for free stuff above, so I appreciate your support for my paid work.

CIAOPS Publications – https://directorcia.gumroad.com/

Access to the CIAOPS community for technical support, product discounts and access to the best Office 365 and Azure information

CIAOPS Patron – http://www.ciaopspatron.com

You can also just buy me a coffee and support what I do – https://ko-fi.com/ciaops, which I would very much appreciate.

General Interest

Australian Battlefields of World War 1 France –http://www.anzacsinfrance.com/
Kiva Loan portfolio – http://www.kiva.org/lender/robert5824
CIAOPS Labs – https://blog.ciaopslabs.com/

I’m a big believer in supporting those who want to build their own business but just need a leg up to get started. Kiva is simply and easy way to provide this and I recommend this to everyone.

Being an Electrical Engineer by trade I enjoy building and solving problems with a variety of projects. This involves digging to electronics, IoT and 3D Printing amongst other things. I try and document all of those learnings over at CIAOPS Labs when I can.

Goodreads (reading list) feed https://www.goodreads.com/user/show/708903-robert

In 2025 I read over 30 books. That means I do a lot of reading on a variety of topics and with Goodreads you can follow along with the books I’m reading as well as those that I add to my bookshelf. I’ll have an upcoming post on my recommended reads, so watch out for that post coming soon.

If you ever need to send me stuff you can do so via the following address:

PO Box 5
Beecroft NSW 2119
Australia

My Bitcoin address is – bitcoin:bc1qwgcr296c7rtjvlpkv9yy5033qjgwwrvttxhtm7

My Ethereum address is – ethereum:0xD7cc991E1f84B625C3723D2965C9948238F5DFe8

Unlock New Revenue with AI: The Ultimate Playbook for MSPs Serving SMBs

Transform your MSP business and your clients’ success with “AI as a Revenue Stream for SMB-Focused MSPs: A Step-by-Step Playbook.”
My comprehensive guide reveals how Managed Service Providers (MSPs) can harness the power of AI—especially Microsoft 365 Copilot—to create profitable, recurring revenue streams while delivering real, measurable value to small and mid-sized business clients.

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Proven Strategies: Learn how to build in-house AI expertise, develop marketable service offerings, and position your MSP as the go-to AI advisor for SMBs.
Actionable Playbooks: Step-by-step instructions for AI readiness assessments, Copilot pilot deployments, custom AI solution development, and ongoing managed AI services.
Real-World Examples: Discover practical use cases, pricing models, and packaging ideas that have driven success for forward-thinking MSPs.
Marketing & Sales Tactics: Get tips on educating your market, overcoming AI skepticism, and using demos and case studies to close deals.
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Why This Guide?

Written by industry experts with deep Microsoft 365 and AI experience.
Packed with checklists, templates, and ready-to-use service packages.
Designed for immediate action—whether you’re just starting with AI or looking to scale your offerings.

Perfect for:

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Business owners seeking to future-proof their services and boost client retention.
Anyone looking to monetize AI and Microsoft Copilot in the real world.

Don’t let your MSP get left behind.
Download “AI as a Revenue Stream for SMB-Focused MSPs” and start building your next growth engine today!

As a Boxing Day sale, I’m offering this publication for free in exchange for your joining my email list. To get your copy just provide your details here:

https://forms.office.com/r/T4ZSWhquJ8

and will be emailed out to you. This offer is valid until 1/1/2026.

I would always appreciate you supporting my work by purchasing a copy (nominate your own price) here:

https://directorcia.gumroad.com/l/airevenue

and don’t forget all my other publications can be found here:

https://directorcia.gumroad.com/

All the best for the holidays.

Flight School: Mastering Copilot for IT Pros

Join us for an immersive 5-day virtual training designed exclusively for IT Professionals and Managed Service Providers from the 12 – 16 January 2026. This isn’t just another webinar—it’s a hands-on, deep dive into how Microsoft Copilot can transform the way you manage, automate, and secure your IT environment.

What you’ll gain:

* Master Copilot’s capabilities for IT operations, security, and automation.

* Learn practical workflows that save time and boost efficiency.

* Explore advanced scenarios for troubleshooting and compliance.

* Future-proof your skills with insights into emerging Copilot integrations.

Why attend?

* Live, interactive sessions with real-world demos.

* Expert-led guidance tailored for IT Pros and MSPs.

* Actionable takeaways you can implement immediately.

Format:

* 5 consecutive days

* 2 hours per day

* Delivered remotely via Microsoft Teams. Recording available after session.

Your Copilot journey starts here—are you ready to take off If so, register your interest here – http://bit.ly/ciaopsroi. Early bird discounts until 12 December 2025.

Prices

Patron level	RRP	GST	ex GST	Saving
None	$399.00	$36.27	$362.73
Bronze	$199.00	$18.09	$180.91	$200.00
Silver	$99.00	$9.00	$90.00	$300.00
Gold	$49.00	$4.45	$44.55	$350.00

Strategic Imperatives for Small MSPs: Ensuring Relevance and Profitability with Microsoft Technologies in 2025

Executive Summary

The Managed Service Provider (MSP) landscape is undergoing a significant transformation, driven by technological advancements, evolving customer expectations, and an escalating threat environment. For small MSPs focused on Microsoft technologies, relevance and profitability in 2025 and beyond hinge on a strategic pivot from reactive troubleshooting to proactive, value-driven partnerships. This report outlines key strategies, Microsoft technologies, essential skills, and operational optimizations to ensure sustainable growth and maximize profitability. The core pillars for success include a security-first mindset, aggressive adoption of artificial intelligence (AI) and automation to reduce labor costs, a shift to recurring revenue models, and a focus on delivering high-value, specialized services that address critical client needs.

The Evolving MSP Landscape: Trends and Opportunities

The MSP industry is experiencing rapid growth, projected to reach $69.55 billion by 2025 in the U.S. and $595 billion globally for IT managed services delivered by channel partners.1 This expansion reflects a fundamental shift in how businesses approach IT management, moving from reactive break-fix models to proactive, managed services.1 Small MSPs must understand these macro trends to position themselves effectively.

Shift from Reactive to Proactive, Holistic Managed Services

Historically, MSPs functioned as reactive troubleshooters, intervening only when technical issues arose. However, there is an undeniable and ongoing shift towards more holistic and proactive approaches, where MSPs assume greater responsibility for their clients’ IT environments.1 This means actively anticipating and preventing problems, rather than merely reacting to them.4 This proactive stance significantly improves system uptime, reduces client stress, and ultimately enhances the overall customer experience by minimizing disruptions.4

This industry-wide transition from reactive to proactive service models carries a profound implication for profitability. When an MSP proactively prevents problems, it leads to improved customer satisfaction and reduced operating costs for the MSP.3 Higher customer satisfaction naturally translates into stronger client loyalty and increased retention rates.4 Clients are less likely to seek alternative providers when their IT environment is stable and issues are pre-empted. This strong client retention is the bedrock of a successful recurring revenue model, providing predictable and stable income streams.6 This financial predictability is crucial for a small MSP’s strategic planning and investment capacity. The predictable revenue then allows the MSP to reinvest in advanced tools, such as AI and automation, and skilled personnel, further enhancing their proactive capabilities. This, in turn, leads to even better service delivery, higher customer satisfaction, and continued retention, perpetuating a self-reinforcing cycle of growth. For small MSPs, adopting a proactive service model is therefore not merely a service improvement; it is a direct, measurable driver of long-term financial stability, scalability, and competitive advantage. It transforms the MSP from a cost center, primarily fixing problems, to a value generator that prevents problems and enables business continuity.

The Transformative Impact of AI and Automation on MSP Operations and Profitability

Artificial intelligence is poised to significantly boost profitability for MSPs in 2025, primarily by facilitating and managing automation.3 This directly targets the largest cost component for MSPs: labor, which typically accounts for 60-70% of the cost of goods sold (COGS).3

Automation, particularly when enhanced with AI, can drastically reduce the time spent on manual tasks, freeing up valuable staff resources. Currently, MSP leaders estimate that 39% of their staff’s time is consumed by manual efforts, hindering their ability to focus on innovation and strategic goals.3 AI-driven automation can streamline complex operations such as monitoring, classifying, and routing support tickets, as well as executing scripts to “heal” (fix) anomalies before they cause outages.3 AI-powered analytics can proactively flag devices missing patches, running outdated security libraries, or exhibiting performance issues, leading to more robust computing environments and reduced operating costs by preventing problems.3

The ability of AI and automation to directly reduce labor costs, the highest expense for MSPs 3, has a broader strategic implication. Automation streamlines repetitive tasks, freeing up a significant portion of staff time.3 This freed-up time is not simply “saved” but can be strategically reallocated. Technicians can now manage a larger portfolio of clients, deliver more complex and higher-value services, or spend more time on strategic client engagement.8 The true power of AI and automation for a small MSP lies in its ability to enable scalability without a commensurate increase in labor force.3 This shifts the growth model from a linear progression, where more clients necessitate more staff, to a more exponential one, where existing staff can handle significantly more workload or higher-value work. This allows small MSPs to overcome traditional limitations of scale. They can effectively compete with larger players by maximizing revenue per employee, improving overall profit margins, and positioning themselves as innovative partners. It is about enabling the capacity for more valuable work, not just doing the same work more cheaply.

The Enduring Criticality of Cybersecurity and Compliance

Cybersecurity is consistently ranked as the number one concern for both MSPs and their clients.1 The threat landscape is escalating, with data breaches increasing by 72% between 2021 and 2023 3, and the average cost of a data breach reaching a staggering $4.88 million in 2024.16

Despite these alarming statistics, a significant market gap exists: fewer than a third of MSPs currently focus on cybersecurity as a primary service.1 This represents a substantial opportunity for specialization and differentiation.1 The regulatory environment is becoming increasingly stringent, with new data privacy regulations (e.g., GDPR, HIPAA, CCPA, DORA) imposing complex compliance requirements and substantial fines for non-compliance.2 MSPs are also facing increased liability in the event of a breach.12 Customers are demanding comprehensive, integrated IT solutions, with cybersecurity now expected as a standard offering, not an optional add-on.2 The market is moving towards advanced cyber solutions such as Managed Detection and Response (MDR), Extended Detection and Response (XDR), Secure Access Service Edge (SASE), and Zero-trust architectures.2

The convergence of high client demand driven by fear of breaches, market undersupply of specialized cybersecurity services, increasing regulatory pressure, and attractive profit margins elevates cybersecurity from a mere service offering to a mandatory, high-value profit center. By building strong in-house cybersecurity expertise or strategic partnerships, MSPs can position themselves as indispensable trusted advisors. This proactive stance in protecting client assets and ensuring compliance fosters deep trust, which is crucial for securing long-term, high-value contracts. For small MSPs, cybersecurity must be integrated as a foundational element of their service stack and a core part of their Unique Value Proposition (UVP). Failing to adopt a security-first mindset is not just a missed revenue opportunity but a significant business risk due to potential liability, reputational damage, and declining customer confidence. This transforms the MSP from a general IT provider to a critical risk management and business continuity partner.

Market Consolidation and the Need for Specialization

The MSP industry is experiencing increasing consolidation, driven by heightened competition and customer demand for comprehensive, integrated IT solutions across all areas, from security and cloud services to automation and data analytics.3 This trend suggests that the market will likely be dominated by a few large players offering integrated suites of services.3 For smaller MSPs, this competitive landscape means that failing to innovate or expand their capabilities puts them at risk of being left behind.3 To remain competitive and relevant, many are finding success by doubling down on specialized services.1

The market consolidation, with larger players offering broad, integrated service suites 3, presents a challenge for small MSPs who cannot effectively compete on the sheer breadth of services. This necessitates a strategic response: specialization.1 By focusing on a specific vertical market (e.g., healthcare, legal, finance) or a deep technical niche (e.g., advanced Microsoft security, specific Azure workload optimization), a small MSP can cultivate unparalleled expertise. This depth of knowledge allows them to become the go-to expert for a targeted Ideal Client Profile (ICP).17 This expertise reduces direct competition within that niche, justifies premium pricing, and fosters stronger, more loyal client relationships. Specialization enables a small MSP to carve out a distinct competitive edge, moving from being a generalist “jack-of-all-trades” to a highly sought-after “master of one.” This strategic focus simplifies marketing and sales efforts 17, improves operational efficiency by standardizing solutions for a specific client type, and ultimately drives greater profitability by allowing the MSP to command higher rates for specialized, high-value knowledge. It is about strategically choosing which clients not to serve to better serve those who are within the chosen niche.

Driving Customer Relevance and Profitability

To stay relevant and profitable in the evolving IT landscape, small MSPs must proactively engage with clients, offer services that deliver clear and measurable value, and strategically leverage the extensive Microsoft ecosystem.

Embracing Proactive and Value-Added Service Models

Transitioning to Recurring Revenue Models

Adopting recurring revenue models, such as subscription-based services or retainer agreements, is paramount for a small MSP’s financial stability. This model generates a consistent and predictable income stream, which is crucial for strategic planning, reinvestment in innovative technologies, and overall business growth.6 Critically, it transforms the client relationship from a transactional “break-fix” dynamic to a long-term, collaborative partnership, significantly reducing customer churn rates.6

Offering High-Value Services Beyond Basic IT Support

Small MSPs should strategically move beyond traditional, low-margin services like basic IT support (which only 11.8% of MSPs prioritize) and simple data backup (6.6%), as many businesses now handle these in-house or through basic cloud solutions.1 Instead, the focus should be on services that address clients’ most pressing concerns, such as business continuity 1 and, most importantly, advanced cybersecurity.1 High-value, high-markup services include:

Advanced Cybersecurity Solutions: Managed Detection and Response (MDR), Security Information and Event Management (SIEM), proactive security alerting and containment, managed patching, secure internet gateways, and essential phish testing and cybersecurity awareness training for employees.16 These services command high markups.2
Comprehensive Business Continuity and Disaster Recovery (BCDR): Beyond basic data backup, offer robust solutions encompassing advanced backup strategies, detailed disaster recovery planning, and proactive risk mitigation assessments.1
Strategic IT Consulting: Position the MSP as a strategic advisor, helping clients navigate digital transformation, conduct compliance audits, optimize IT budgeting and costs, and future-proof their technology infrastructure.19
Vendor Management: Simplify clients’ IT landscapes by acting as a single point of contact for multiple technology vendors, assisting with contract negotiations, and managing the lifecycle of IT assets.19
AI Integration & Consulting: With AI rapidly being integrated into most software 2, MSPs have a unique opportunity to help customers define the ROI of AI integrations within their line-of-business (LOB) tools, becoming a crucial partner in their AI adoption journey.2

Delivering Exceptional Customer Service and Building Long-Term Relationships

Exceptional customer service is a direct determinant of client retention, revenue generation, and overall business growth.21 This extends beyond mere technical support to include prompt, courteous interactions, clear and jargon-free communication, and proactive engagement.6 Regular check-ins, scheduled technical assessments, and fostering open dialogue are vital for identifying evolving client pain points and uncovering new opportunities for service expansion or upselling.22

Many MSPs struggle with pricing, often undercharging for their services, which impacts profitability.24 Attempting to compete solely on price leads to a “race to the bottom,” attracting clients who prioritize cost over value, ultimately resulting in low-profit margins.24 Instead, shifting the sales conversation to focus on the value delivered, such as increased efficiencies, demonstrable return on investment, guaranteed uptime, and enhanced security posture, allows MSPs to justify and command higher prices.24 By articulating services in terms of business outcomes rather than just technical features, MSPs can move away from commodity pricing. This is particularly effective for high-margin services like advanced cybersecurity, where the value of risk reduction and business continuity is easily quantifiable for the client.2 This consultative selling approach transforms the MSP from a perceived “cost center” to a “profit center” for the client. Small MSPs must educate their clients on the true value and cost of robust IT services, especially cybersecurity. By demonstrating how their services contribute directly to the client’s bottom line or mitigate significant risks, they can differentiate themselves from price-focused competitors, attract more profitable clients, and secure higher average contract values, thereby elevating overall business profitability.

Leveraging Microsoft Technologies for Growth and Profitability

Microsoft’s comprehensive ecosystem offers unparalleled opportunities for small MSPs to build robust recurring revenue streams and significantly enhance their service offerings.7

Key Microsoft Technologies & Profitability Drivers

Microsoft Technology/Service	Key Features/Components	Profitability Driver for MSPs
Microsoft 365 Copilot	AI-powered writing assistance, data analysis, web grounding, real-time co-authoring, automated notetaking & summarization in Teams.	Recurring Revenue (add-on, ongoing support), Strategic Value (client productivity), Upselling (optimization services).
Microsoft Defender (for Endpoint/Office 365)	Enhanced cyberthreat protection against viruses, phishing, ransomware, malware; device and endpoint protection.	High Markup Potential (critical security), Recurring Revenue (managed security services), Enhanced Client Retention (trust).
Microsoft Purview	Data classification & labeling, sensitive information protection, insider risk management, data security posture management for AI activity, audit logs.	High Markup Potential (compliance, data governance), Strategic Value (risk reduction), Recurring Revenue.
Microsoft Entra ID (formerly Azure AD)	Advanced identity and access management, granular role-based access controls (RBAC), multi-layered authentication.	Recurring Revenue (managed identity), High Markup Potential (security foundation), Compliance.
Microsoft Teams, OneDrive, SharePoint, Loop	Core collaboration, file sharing, document management, co-creation workspaces.	Recurring Revenue (managed collaboration), Upselling (optimization, integration), Operational Efficiency (client productivity).
Azure AI	Comprehensive AI services & tools for building, deploying, managing AI solutions; predictive maintenance, data-driven insights.	High Markup Potential (advanced services), Strategic Value (digital transformation), Recurring Revenue (managed AI solutions).
Azure Virtual Desktop (AVD) & Windows 365	Cloud-based virtual desktops, improved costs, enhanced security for clients.	Recurring Revenue (managed desktop environments), Cost Optimization (for client), Efficiency Gains.
Power Platform (Power Apps, Power Automate, Power BI, Copilot Studio)	Low-code app development, workflow automation, conversational analytics, custom AI agent creation.	Recurring Revenue (managed automation, analytics), Strategic Value (business process optimization, digital transformation), Upselling.
Managed Backup & Disaster Recovery (using Azure)	Reliable, scalable backup services, disaster recovery planning, cloud storage.	High Markup Potential, Recurring Revenue (predictable income stream), Enhanced Client Retention (business continuity).
VoIP Services	Reliable phone systems with managed support.	High Margin, Recurring Revenue (“sticky” service), Essential Business Need.
Managed Email Services	Secure, reliable email, spam filtering, compliance management.	High Margin, Recurring Revenue, Addresses Fundamental Business Need.

Microsoft’s aggressive integration of AI (Copilot, Azure AI, Power Platform AI) across its entire product suite 7 presents a unique opportunity. Many customers struggle to move AI projects beyond the proof-of-concept stage and need assistance in defining the Return on Investment (ROI) for AI integrations.2 MSPs are uniquely positioned to provide ongoing support, updates, and optimization for these AI-powered tools and features.7 This goes beyond initial setup. As AI becomes embedded in core business applications, clients will increasingly rely on MSPs not just to manage their IT infrastructure, but to help them effectively leverage these transformative AI capabilities to achieve specific business outcomes. This creates a highly “sticky” service relationship, as the client’s operational efficiency and competitive advantage become deeply intertwined with the MSP’s expertise in managing and optimizing their AI-powered Microsoft environment. This reliance makes the service less susceptible to price-based competition. This positions the MSP at the cutting edge of digital transformation for their clients, elevating their role from IT support to a strategic business enabler. The recurring revenue generated from managing and optimizing AI solutions will be substantial and more resilient, as the value is clearly demonstrated through improved client efficiency, enhanced insights, and competitive advantage.

Developing Essential Skills and Expertise

To remain competitive and profitable, small MSPs must invest in a diverse range of skills, encompassing both technical mastery and crucial business acumen.

Core Technical Skills

A deep and practical understanding of Microsoft 365 and Azure is no longer optional but paramount.21 This includes advanced concepts such as Conditional Access and eDiscovery within M365 environments.32 Fundamental knowledge of network management is essential for overseeing data flow, connectivity, and basic security practices like antivirus and multi-factor authentication.21 Despite the shift to cloud, foundational knowledge of server management and general IT troubleshooting remains critical for supporting diverse small business environments.21 Proficiency in automation systems and understanding how to integrate disparate tools is vital for streamlining repetitive tasks and enhancing team productivity.21

Business Acumen

MSP owners require strong leadership skills to guide their teams, make crucial decisions, and foster a positive work environment.21 A solid grasp of financial concepts like cost drivers, burn rate, capital expenditures, and invoicing is indispensable for managing expenses, maximizing revenue, and ensuring the long-term sustainability of the business.21 The sales approach must evolve from purely transactional to a consultative model that focuses on delivering measurable business outcomes for clients.24 This requires active listening, the ability to relate to business leaders’ challenges, and crafting mutually beneficial partnerships.34 Developing a strong online presence is crucial, leveraging digital-first strategies such as social media (used by 25.8% of MSPs for client acquisition) and content marketing.1 Defining a clear Unique Value Proposition (UVP) and an Ideal Client Profile (ICP) is fundamental for effective differentiation in a crowded market.17

Soft Skills

Providing exceptional customer service is directly linked to client loyalty, retention, and the generation of new business through word-of-mouth referrals.21 This encompasses prompt and courteous support, consistent communication, and proactive engagement.6 The MSP industry is characterized by rapid technological evolution and intense competition. A commitment to continuous learning and adaptability is vital for staying relevant and responsive to changing market demands.3 Given the varied and often unique IT environments of small businesses, the ability to quickly “figure things out” and effectively utilize available resources is a highly valued skill.32 Clear, concise communication, free of excessive technical jargon, and a focus on setting clear expectations with clients are essential for building trust and avoiding misunderstandings.23

Microsoft Certifications and Partner Designations

Microsoft offers various Solutions Partner designations (e.g., Azure, Business Applications, Modern Work, Security) that allow MSPs to differentiate their capabilities, gain credibility, and unlock valuable partner benefits.25 Specializations further validate deep technical expertise in specific areas within these solution areas.25 Microsoft’s “Cloud Weeks for Partners” (covering Azure, Business Applications, Modern Work, and Security, with integrated AI & M365 Copilot content) are specifically designed to accelerate the journey toward these certifications and meet the skilling requirements for partner designations.38

The research highlights a wide array of necessary skills: traditional technical 32, cloud/AI technical 2, business acumen 21, and soft skills.21 Historically, MSPs might have focused heavily on technical skills. However, the market now demands strategic partnerships, not just technical fixes. A purely technical skillset is no longer sufficient for a small MSP to thrive. Profitability and relevance in the current landscape demand a sophisticated blend where technical depth, especially in cloud and AI, is complemented by strong business acumen to identify and monetize opportunities, and exceptional soft skills to build and maintain lasting client relationships. The ability to translate technical solutions into clear business outcomes is paramount. Small MSPs must move beyond viewing training solely as technical certification. They need to invest in continuous, multi-faceted professional development that includes sales training for technical staff, financial literacy for leadership, and comprehensive customer service training for all client-facing roles. This holistic approach transforms the MSP’s identity from a reactive “IT guy” to a proactive “business technology partner,” fostering a more integrated and profitable organizational capability.

Optimizing Operations and Minimizing Resource Drain

Maximizing profitability for small MSPs is not solely about increasing revenue; it equally hinges on ruthlessly optimizing internal operations and systematically eliminating inefficiencies and resource drains.

Strategic Automation and AI Integration

Automating Low-Value, Repetitive Tasks

While critical for security, manual patch management is highly time-consuming, prone to human error, and unrealistic in modern IT environments. Automation tools proactively scan for missing patches, test them in sandbox environments, and verify installations, significantly reducing technician workload and improving security posture.8 In dynamic IT infrastructures, assets are constantly changing. Automated asset discovery continuously scans and catalogs hardware and software in real-time, preventing “shadow IT” and expanding attack surfaces. This instant visibility is crucial for security and compliance.9 Manual network health monitoring is an uphill battle in complex environments. Automated solutions detect anomalies, identify bottlenecks, speed troubleshooting, and alert IT teams proactively before issues impact business operations. This also builds historical data for future performance optimization.8 Automating ticket creation, processing, resolution, categorization, assignment, and customer follow-up streamlines help desk operations. This leads to faster response times, improved efficiency, and enhanced client satisfaction.3 Automating recurring invoices, payments, and overdue payment reminders minimizes billing errors, improves cash flow, and reduces administrative overhead.7 Automated analytics and reporting systems provide clients with valuable insights into their system operations, enabling strategic planning and remediation. This demonstrates the MSP’s value while saving significant manual effort.8 Automating regular, verified data protection and disaster recovery processes ensures business continuity and minimizes costly downtime during incidents.6

Leveraging AI for Predictive Maintenance and Operational Efficiency

AI-powered systems can handle tasks like system monitoring, ticket triage, and incident response with greater speed and accuracy than human operators, reducing errors and ensuring prompt issue resolution.11 Predictive analytics, driven by AI, can process and analyze vast amounts of data in real-time, identifying patterns and trends in system performance to predict and prevent potential issues before they occur.11 AI-powered chatbots can significantly enhance customer support and streamline query handling, providing round-the-clock assistance, which is particularly beneficial for resource-limited small MSPs.35

Manual, repetitive tasks consume a significant portion of MSP staff time 3 and prevent focus on strategic goals.3 Automation directly reduces labor costs 3 and frees up technician time. This freed-up time can then be reallocated to higher-value activities that drive profitability and client satisfaction, such as strategic IT consulting, designing bespoke solutions, proactive client engagement, and developing new service offerings.8 Automation is not just an efficiency play; it is a critical enabler for a small MSP to effectively pivot from a reactive, low-margin model to a proactive, value-added one. Without automating the mundane, staff will remain perpetually “chasing fires” 12, leaving no capacity for the strategic work that commands higher prices and builds deeper client trust. Automation forms the operational backbone that allows a small MSP to “do more with less,” not by compromising service quality, but by intelligently reallocating human capital to tasks that generate higher margins and foster stronger client relationships. This directly supports the move away from price-based competition and enables sustainable growth.

High-Impact Automation Opportunities for Small MSPs

Task Area	Manual Pain Point/Challenge	Automation Approach/Tools	Expected Benefits for MSP
Patch Management	Time-consuming, error-prone, security vulnerabilities from missed updates.	RMM tools (e.g., N-able N-Central RMM, Kaseya VSA), automated testing in sandbox.	Reduced technician workload, improved security posture, reduced exposure window.
Ticket Management/Triage	Manual classification & routing, delays, “cherry-picking”.	PSA platforms (e.g., HaloPSA), AI-powered dispatching (e.g., MSPbots, Atera Autopilot), automated workflows.	80% dispatcher time saved, faster response times, consistent policy enforcement, reduced resolution times.
Network Monitoring & Alerting	Manual oversight, missing anomalies, slow troubleshooting.	RMM tools (e.g., N-able N-Central RMM, NinjaOne), AI-powered anomaly detection, predictive analytics.	Enhanced network uptime, faster response times, reduced operational costs, proactive problem prevention.
Client Billing & Invoicing	Manual invoice generation, tracking, payment reminders, errors.	PSA platforms (e.g., Autotask, HaloPSA), billing automation tools.	Minimized billing errors, improved cash flow, reduced administrative overhead, predictable cash flow.
Client Reporting	Manual data compilation, time-consuming, inconsistent reports.	Advanced reporting & analytics systems, AI-powered data visualization (e.g., MSPbots).	Demonstrates value to clients, saves hours of manual effort, enables strategic discussions.
Backup & Disaster Recovery Orchestration	Manual verification, slow recovery processes, human error.	Automated backup solutions (e.g., BDRSuite, Slide BCDR), predictive maintenance.	Ensures business continuity, minimizes costly downtime, secure data protection, predictable income.
Asset Discovery	“Shadow IT,” forgotten devices, expanding attack surfaces.	Automated asset discovery tools.	Continuous real-time scanning, instant visibility into infrastructure changes, improved security & compliance.

Phasing Out Legacy Systems and Inefficient Practices

Profitability and relevance are significantly hampered by clinging to outdated technologies and inefficient business practices.

Addressing Security Vulnerabilities and Integration Roadblocks of Outdated Technology

Legacy systems, defined as outdated hardware or software platforms still in use despite newer alternatives, pose significant risks.42 They inherently lack modern security features and are often built on unsupported software, making them highly vulnerable to sophisticated cyberattacks like ransomware and data breaches.42 A 2025 study noted 78% of ransomware attacks targeted outdated software.42 Furthermore, legacy systems create substantial integration roadblocks. Unlike modern, API-driven software stacks, they often require costly custom integrations or manual workarounds, leading to inefficiencies and fragmented data silos.42 Maintaining these old systems is expensive, and the pool of qualified technicians with expertise in outdated technologies shrinks annually.43

Strategies for Modernizing Legacy IT

A crucial first step is to conduct a thorough system audit to identify all legacy components, assess their associated risks, and determine their business criticality.42 Develop a phased approach to modernization, rather than attempting a disruptive “rip and replace.” This can involve replatforming (porting applications to a new platform with minimal code changes), rehosting (lift-and-shift to a cloud platform without significant architectural changes), or gradually replacing components.42 A key strategy is to build APIs around existing legacy systems. This allows older platforms to communicate with newer tools, improving flexibility and integration without immediately disrupting core operations.42 Embracing hybrid environments (combining on-premise and cloud solutions) during the transition can reduce downtime and allow teams to adapt gradually.42 If internal teams lack specific legacy migration experience, partnering with specialized MSPs or IT consultants can provide the necessary expertise.42

Avoiding the “Race to the Bottom” by Competing on Value, Not Price

A common pitfall for many MSPs is undercharging for their services, often due to a lack of understanding of their true cost drivers.24 Attempting to compete solely on price is a “race to the bottom” that attracts clients focused only on cost, leading to unsustainable low profitability.24 Instead, small MSPs must focus on articulating and demonstrating the value they bring through their team and security toolset. This means conveying benefits in terms of efficiencies, measurable ROI, guaranteed network uptime, and enhanced security posture, rather than just listing line-item services.24 It is critical to understand that higher rates are necessary to properly secure clients, as robust cybersecurity solutions and expertise come at a cost.24

Minimizing Over-Flexibility in Service Offerings and Standardizing Solutions

While some flexibility is necessary to cater to diverse client needs, excessive customization or offering too many service bundles (e.g., six to eight bundles) can lead to inconsistent service delivery, operational nightmares, and make it difficult to maintain service levels.23 Standardizing equipment provided to clients and streamlining service bundles (e.g., offering three to four tiered packages like Silver, Gold, Platinum) significantly increases operational efficiency, simplifies technician training, and ensures consistent service quality across the client base.23 The goal is to offer what the MSP specializes in, in a standardized, efficient manner, while still allowing for some tailored solutions where truly necessary.23

These seemingly disparate challenges—costly legacy systems, low-margin price competition, and inefficient customized service offerings—all point to a common underlying factor: a lack of rigorous operational discipline. Proactively modernizing legacy IT, adopting a value-based pricing strategy, and standardizing service offerings are not isolated initiatives. They are interconnected aspects of imposing structure and efficiency across the entire business. This discipline is crucial for reducing hidden costs, preventing “profit leakage,” and freeing up valuable resources, both human and financial, that would otherwise be consumed by reactive fixes, inefficient processes, or underpriced services. For small MSPs, sustainable profitability is not solely about aggressive sales or introducing new services. It is equally, if not more, about optimizing the delivery of services. This disciplined approach to operations builds a more resilient, scalable, and ultimately more profitable business model, allowing the MSP to invest in future growth areas and maintain a competitive edge.

Strategic Recommendations for Small MSPs

Based on the comprehensive analysis of the evolving MSP landscape, key profitability drivers, and operational optimization opportunities, small MSPs should focus on the following strategic imperatives to ensure long-term relevance and maximize their business potential:

Prioritize a Security-First Mindset and Advanced Cybersecurity Offerings: Integrate comprehensive cybersecurity as a core, non-negotiable component across all service offerings, rather than treating it as an optional add-on.2 This includes foundational elements like multi-factor authentication (MFA) and endpoint detection and response (EDR), moving towards more advanced Managed Detection and Response (MDR) and Security Information and Event Management (SIEM).2 Invest strategically in specialized cybersecurity expertise and robust infrastructure to deliver high-value solutions, such as security awareness training, phish testing, and compliance services.1 Leverage Microsoft’s native security capabilities, including Microsoft Defender for Endpoint/Office 365, Microsoft Purview for data governance and compliance, and Microsoft Entra ID for advanced identity and access management, as foundational layers for client protection.26
Invest Heavily in AI and Automation to Reduce Labor Costs and Scale: Systematically identify and automate repetitive, low-value tasks across all operational areas, including patch management, network monitoring, asset discovery, ticket management, billing, and client reporting.3 Actively explore and implement AI-powered tools for predictive maintenance, advanced threat detection, intelligent ticket triage, and automated anomaly resolution.3 Utilize Microsoft’s AI capabilities, such as Azure AI, Microsoft 365 Copilot, and Power Automate, not only to enhance internal MSP efficiency but also to drive client productivity and create new recurring revenue streams.7
Deepen Specialization and Target Niche Markets: To differentiate in a consolidating market, define a precise Ideal Client Profile (ICP) and a compelling Unique Value Proposition (UVP).17 This involves targeting specific industries (e.g., healthcare, legal, finance) or client types with tailored IT solutions and compliance expertise.17 Develop deep industry-specific knowledge, certifications, and marketing materials (e.g., case studies, compliance guides) to reinforce expertise within the chosen niche.17 This specialization justifies higher pricing and fosters stronger client loyalty.1
Foster Strong Client Relationships Through Proactive Support and Value Delivery: Transition fully to a recurring revenue model, emphasizing long-term partnerships and continuous value delivery over one-time projects.6 Prioritize proactive support, actively monitoring systems and addressing potential issues before they escalate and impact client operations.4 Shift communication to focus on the business outcomes of services (e.g., ROI, increased uptime, enhanced efficiency, reduced risk) rather than merely technical features. This consultative approach enables value-based pricing.24 Implement regular client check-ins, technical assessments, and open dialogue to continuously understand evolving needs and identify opportunities for upselling or cross-selling new services.22
Continuously Upskill Staff in Modern Microsoft Cloud and AI Technologies: Invest in ongoing professional development that encompasses both advanced technical skills and essential business acumen.21 Actively pursue Microsoft certifications and Solutions Partner designations (e.g., Azure, Microsoft 365, Security, Power Platform) to validate expertise, enhance credibility, and unlock valuable partner benefits.25 Prioritize training in core cloud platforms (Microsoft 365, Azure), advanced networking, and automation tools, ensuring the team is equipped to manage modern, complex IT environments.32