Hats Chart Playbook 1

The Tried and True MSP organizational structure

Designing your managed services organization structure is crucial to professionalizing your work. It is an essential step of building a machine and, believe it or not, is something you will need to figure out right at the beginning.

I know it sounds strange to think about MSP organization structure when there are just two of you banging away at computers in a garage. The organization structure, though, is about more than hierarchies and putting people in the right roles: the organization structure defines what roles there are to be done.

Even if there are only two of you stuck in a garage, you still must understand what functions your MSP must perform and be clear about who performs these functions and when.

To illustrate this point, think of a burger restaurant – one essential function is cooking the patty, another is assembling the burger, and a third is collecting the money. No matter how many of you there are, you must perform all three of these functions.

We call these functions “hats.” We do this specifically to distinguish them from positions; in a small business, one person will wear many hats – but, again, you still must know what those hats are.

Eventually, you will hire others to wear some hats, but hiring and job definition is a separate conversation. The hats chart is about deciding what functions you need and creating a plan to deliver those functions. Later, you get into hiring people to do the work.

The problem with not defining an MSP organization structure is that you end up with a jumble of activity, which leaves you dropping the ball and makes hiring impossible.

MSP ORg Chart
Managed Services Organization Chart Done for You

You could come up with your own Hats Chart.

Or… you could use ours.

Our Mindomo template includes the roles, job descriptions, and initial KPIs.

It’s the best place to start.

The danger of the jumble

Here’s why: you can’t scale if you work within a jumble of activity, and you will invariably drop the ball somewhere.

You realize you are dropping the ball, so you hire people to work with you. Since they don’t know what to do, they also end up dropping the ball. Nothing you do solves the problem.

This is a trap because one of two things happens:

  1. You find people who disappoint you. One of the most common scenarios is that no matter how hard you look, you cannot find anyone to do the work you need them to do. They start, and then they leave. Everyone seems incompetent. Why? Because you aren’t clear about what they need to do.
  2. You find someone just like you who can do the work the way you do, so you lean on them too heavily. You pile more of the jumble onto them. They seem to do great until they get sick of it and leave one day. Then you are back to square one. The jumble is still undefined, and you must look for people who disappoint or appear like fairy godmothers.

The solution is to structure your MSP up front.

The MSP organization hats chart is first about defining all the functional roles in the organization and second about allocating those roles to individuals. It includes hierarchy but is a functional hierarchy rather than an individual one.

What I mean by this is that hats report to other hats. A sales manager reports to the Chief Marketing Officer, which is a logical reporting arrangement. What if the person who wears the CEO hat also fills the sales manager role while someone else fills the CMO role? In this case, when the CEO wears the sales manager hat, they report to the CMO. When the CEO wears the CEO hat, the CMO reports to them.

This sounds a bit funny because we are used to, and we are taught, that organization structures involve one person reporting to another person in an immutable hierarchy. That’s great if you are a multimillion-dollar corporation, but small MSPs don’t have that luxury.

That’s the fun of building a business.

So, what is an optimal MSP Organization Structure/functional structure?

Here is how we recommend structuring your MSP:

MSP organization Structure
The standard MSP Organization Structure / MSP organigram

This structure is what we recommend to all MSPs. Even if you are literally in a garage, these are the functions you will have to complete.

Often the core team is made up of:

The Chief Executive Officer

The CEO leads the company and fills the big-picture strategic hat. The CEO should be looking externally and forward to bring ideas to the internally focused team. You need someone for this role who can take on that high-level, outside-looking point of view and translate that into objectives and key results for the organization.

Often, we find that the CEO also takes on the marketing/CMO function because marketing and CEO thinking are similar in their outward focus and creative nature. So our second hat is:

Marketing/CMO

This role is responsible for the entire customer value journey, from making them aware of your service to ensuring that they are raving fans.

MSPs often think of marketing as advertising, but marketing is broader – it includes the entire customer experience. Under that falls advertising and sales, but also product design and feedback. Your marketing person also becomes the voice of the customer in your organization, ensuring that they get the results they need.

The CMO is responsible for the following:

  • Set and achieve strategic goals related to social media metrics, advertising, and marketing campaign initiatives
  • Design and improve upon marketing campaigns for each aspect of our company
  • Negotiate compensation and project details for outside contractors related to marketing and promotions
  • Create and propagate an enthusiastic brand message that will resonate with our target demographic
  • Follow up on daily revenue reports, social media strategies, and other components of the marketing program
  • Evaluate data and reports, such as Google Analytics, to make evidence-based decisions regarding marketing

The next crucial hat is:

Operations/COO

Operations is an essential function: this is where delivery happens. If your business grows, you will need someone to wear this hat full-time. Key responsibilities include:

  • Ensure smooth delivery of the promises marketing makes. 
  • Find new ways to deliver the transformation more efficiently and reliably. 
  • Deliver appropriate customer service. 
  • Maintain and oversee the creation of all technical SOPs

The COO oversees everything that happens in the company. Because of this, there are several functions that fit under the COO, including:

VCIO, Virtual CIO

Your virtual chief information officer. Often the person wearing the CEO or COO hat wears this hat. You need someone who can engage with your customers at a senior level. This is often the person who leads your QBR/SBR process.

Typical activities include:

  • Develop and maintain a trusting professional relationship with each assigned client
  • Schedule, prepare, and lead the Strategic Technology Planning (STP) process for all assigned clients
  • Identify upsell/cross-sell opportunities that align with client-stated objectives and unique business goals
  • Engage with clients at a strategic level to align technology to business objectives and goals
  • Develop technology roadmaps and budgets
  • Ongoing development and understanding of key vertical market trends, regulations, and compliance requirements applicable to assigned clients
  • Review project proposals in collaboration with the Professional Services team
  • Respond to and resolve issues and escalations with patience, respect, and professionalism
  • Liaison between client and internal teams
  • Engage with the SSDEs (Sr. Service Desk Engineers) at their branch to discuss proactive systems architecture needs and expected changes, quarterly (post-STP) reviews of any changes the vCIO foresees in the environment for the next 6 months, and recommendations the SSDE has for the vCIO to discuss with the client.

Senior projects manager

The hat that oversees the delivery of projects.

Typical activities include.

  • Provide hands-on technology project management and documentation to support technology projects
  • Drive planning at the various organizational levels to ensure projects are on track/resourced
  • Establish project governance and communication with stakeholders
  • Ensure timetable and deliverable schedules are understood and communicated
  • Manage dependencies proactively, coordinate across teams to resolve issues and mitigate risks
  • Contribute to executive-level updates on strategy, budget, project delivery, controls, risks, etc.
  • Organize required reporting for business and technology management review sessions
  • Track financials related to technology expenditures, including software, hardware, and resource allocation

Help desk manager

The hat that oversees the help desk.

Typical activities include

  • Oversee the day-to-day operations of our service desk
  • Effectively manage, develop and mentor our high-performing global service desk team
  • Ensuring employee satisfaction with their requests
  • Oversee management of incident response
  • Oversee post-mortems of an incident and drive a detailed review of root causes
  • Identifying opportunities for improvement and driving change
  • Develop daily, weekly and monthly reports on the team’s performance and service desk trends
  • Manage budget and licenses for services managed by the service desk team
  • Ensure all processes used by the service desk are thoroughly documented, audited for accuracy, and improved regularly
  • Support company growth through hiring and developing team members’ skill sets.
  • Uphold SLA compliance and address SLA breaches
  • Manage team OKRs and report on team performance
  • Serve as the top-tier escalation point for the team and manage escalated issues
  • Follow up on customer-satisfaction issues and user-feedback responses
  • Ensure team compliance with policies and procedures
  • Manage team schedules
  • Oversee monitoring of service uptime, maintenance windows, and scheduled service

Field Operations Manager

The hat that oversees all field operations.

Typical activities include:

  • Implement short-and long-term strategic plans to ensure infrastructure capacity meets existing and future requirements.
  • Develop, implement, and maintain policies, procedures, and associated training plans for infrastructure administration and end-user support.
  • Participate in the development of IT strategies in collaboration with the executive team.
  • Conduct research and make recommendations on products, services, protocols, and standards supporting infrastructure procurement and development efforts.
  • Prepare RFPs, bid proposals, contracts, the scope of work reports, and other documentation for infrastructure projects and associated efforts.
  • Negotiate with vendors, outsourcers, and contractors to secure infrastructure-specific products and services.
  • Assist with the planning and deployment of infrastructure security measures.
  • Manage and set priorities for the design, maintenance, development, and evaluation of all infrastructure systems, including LANs, WANs, Internet, intranet, security, wireless implementations, computing devices, and so on.
  • Practice IT asset management, including maintenance of component inventory and related documentation.
  • Provide guidance and direction to the network administrator, help desk technicians, and end-user support representatives; conduct performance reviews and administer any required corrective actions.
  • Collaborate with the Projects Team to ensure network functions are clearly communicated and that all group/client needs are considered.

Remember that all of these are functions that are inherent in being an MSP, so they are all functions that you must have in your business. Each of these operations functions has additional sub-functions, but this is the high level.

The next top-level function in the MSP organization chart is:

Tech/CTO

This is another c-level function but with less scope than COO or CMO. The CTO role is important for maintaining your technology and your client’s technology and implementing new solutions. A lot of your intellectual property comes from the CTO’s work.

Hat responsibilities include:

  • Lead the investigation, selection, implementation, and ongoing evolution of the company’s IT infrastructure
  • Be a partner to and provide IT support guidance to each functional leader (R&D, Manufacturing, Field Service, and corporate business organizations)
  • Ensure all corporate information systems are secure and protected from cyber threats
  • Ensure all key corporate IT assets are maintained and updated as needed
  • Provide IT capital plans
  • Manage MSP and ASP support contracts and SLAs
  • As needed, work with external supply chain partners to ensure cloud-connected product and process data is secure and readily available
  • Take on additional tasks as needed by the business

There are three other hats that almost never translate to full-time jobs in a small company. They are:

Finance/ CFO

Even the smallest business must keep track of finances. Cash management is essential to running a business. Small MSP businesses don’t need a full-time CFO, and they often outsource this function to an accountant or bookkeeper. This hat/function is responsible for:

  • Supports both operations and marketing by helping them understand financial implications and find ways to finance investments and opportunities. 
  • Provides clarity on and reports on the financial situation of the company. 
  • Helps manage financial trade-offs and find money (raise capital) when needed. 
  • Manages cash flow. 
  • Supports strategy development
  • Keep company compliant 

Office (factory) Manager

The office manager oversees the “factory” and ensures that it works and supports delivery. Hiring an office manager is one of the first hires you will make, and we often have the office manager role or the person filling that role responsible for the office manager, CFO, and human resources roles.

Typical activities include:

  • To plan, organize, develop, implement, and interpret the programs, goals, objectives, policies, and procedures, as well as the laws and compliance guidelines governing the business office functions.
  • Make independent decisions when circumstances warrant such action
  • Implement and interpret the programs, goals, objectives, policies, and procedures of the company
  • Maintains professional working relationships with all staff, vendors, etc.
  • Maintain and oversee the creation of all non-technical SOPs
  • Understand and follow and enforce company policies, including harassment and compliance procedures

Chief Human Resources officer

The HR function supports and engages your people. There is a large compliance piece here too. However, this is seldom a full-time role, and we often see this combined with the Office Manager role with compliance outsourced to a PEO.

The responsibilities of the HR function are:

  • Hiring, firing, and training. 
  • Support the executive with necessary human resources.
  • Keep the company compliant with HR regulations.  

Almost always, these roles are taken on by an office manager, and technical aspects such as bookkeeping are outsourced.

Dolling out hats, delegation is a core MSP ownership function

You must define your hats and your functions right at the beginning of building your MSP.

At first, you may wear many hats. You might wear them all on day one. But your role as an entrepreneur is to begin delegating those hats when you define them so that you at least know what hats you wear, and then you start handing them out to others. Start with the hats you least like wearing (or where you have the least capability) and progress from there.

For more on delegation, check out these posts:

The delegation matrix, the four stages of delegation, and how to hire a virtual assistant

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