RHEM at Last, RHEM at Last, RHEM thank Autotask, I’m RHEM at last
Welcome back, Autotask warriors! Here’s what we’re covering for you today:
Get excited about RHEM!
Profit matters – period.
Where the RHEM KPI fits in
RHEM = LEAN Process Efficiency
The downside of RHEM
Defining an Endpoint
Consistency is key
How we can help
Looking at the title above, you might wonder if I've gone insane. I may have, but today I am just really excited about this week's topic: RHEM.
We've talked a lot lately about:
the Service Manager's responsibilities
improving Service Delivery
the awesome time-saving Autotask Advanced Live Reports that we create
turning your team into (looks around carefully for Paul Stanley, Joan Jett, or Ozzy from the Workday Super Bowl commercial) rock stars
Profit, One of Our Favorite Things in Business & Life
That has led to discussing one of my favorite things: profit. You tech folks may have gotten into the MSP business to fix things and take great care of Clients. But at some point, you likely decided you wanted to enjoy life, have a few toys, and retire to that nice lake house.
Doing that requires profit. (And no, profit is NOT a dirty word). Another of my favorite things is watching an MSP's eyes light up in a coaching engagement when they realize they can be their own boss AND take care of their family too. The RHEM KPI is one big way we do this.
Did you know? Reactive Hours per Endpoint per Month (RHEM) is the hardest KPI to Find, Benchmark, and Track. However, it is one of the three Service Delivery Pillar KPIs that impact profit, so it’s absolutely worth the time involved.
Previous, we discussed the other two pillars:
1. Inventory => Resource Utilization
2. Throughput => SLA performance or Mean Time To Resolve
RHEM = LEAN Process Efficiency
Those are great, but throwing bodies at the problem or putting things on hold so everyone (but the Client) feels good may not be the best way to solve problems.
RHEM equates to LEAN Process efficiency.
As I mentioned, RHEM is not easy to nail down. Part of this is because RHEM has two sub-KPIs that go into the equation to determine full optimization. Those sub-KPIs are:
1) Technician Effort, which the best MSPs running between 30 to 45 minutes per engagement.
2) Nose per Seat, which for most MSPs is about 1 ticket for every 2 Endpoints, with the best MSPs running about 1 ticket for every 5 endpoints.
Here is a RHEM comparison between, Best, Typical, and You:
MSP Technician Effort Noise per Seat Eps. RHEM Hrs. /Month Cost of MRR
Typical 45 minutes 1 per 2 Endpoints 1000 .375 375 hours $56,000
Your #s ____________ _________________ ______ __________ __________
Best in Class 30 minutes 1 per 5 Endpoints 1000 .1 100 hours $15,000
The Math: (Minutes/60) * (Tickets/Endpoints) * # of Endpoints = hours per month;
Hours per month * Standard Role Rate = Cost of Managed Service Support per $1,000 Endpoints
If the math hurts, then trust me when I say the value of investing in Service Delivery Operational improvements and moving the RHEM # from Typical to Best in Class is worth $41,000 per 1,000 endpoints.**
What You Need to Know: The Downside of RHEM:
While there is great value in tracking an MSP's RHEM number, actually having an RHEM report is very rare for two reasons – Endpoint definition and counts:
REASON #1: There is not a good definition of "Endpoints" from an MSP perspective. Technically by definition, an Endpoint is an endpoint. Trouble is, that leaves out many devices we maintain, such as: Firewalls, Switches, Routers, etc. Things that we maintain, like monitors, mice, etc., are peripheral devices that hang over endpoints. But then there are also grey areas such as printers, scanners, etc.
Note: Here is Webroot's definition of an endpoint with our comments below:
"AN ENDPOINT IS ANY DEVICE THAT IS PHYSICALLY AN ENDPOINT ON A NETWORK. LAPTOPS, DESKTOPS, MOBILE PHONES, TABLETS, SERVERS, AND VIRTUAL ENVIRONMENTS CAN ALL BE CONSIDERED ENDPOINTS. WHEN ONE CONSIDERS A TRADITIONAL HOME ANTIVIRUS, THE ENDPOINT IS THE DESKTOP, LAPTOP, OR SMARTPHONE THAT ANTIVIRUS IS INSTALLED ON. "
Our Definition of an Endpoint
Building off Webroot's definition, we'll define an endpoint as any hardware item that's listed in Autotask Installed Assets, including firewalls, routers and switches. We ignore monitors, keyboards, and mice as these are user interfaces of the endpoint.
However, we do include peripherals like printers, scanners, cameras and PoS devices. And for the most part, we do not consider BYOD because they are not listed in either the RMM or Installed Assets list – even though Webroot states they are an endpoint and most likely supported by the MSP.
REASON #2: Even with a clear definition of what an Endpoint is, it is very hard to get and maintain accurate device counts. Yes, we should depend on the RMM, but it takes a manual override to be sure that we are counting Endpoints, and nothing but the Endpoints.
And yes, the RMM should be in sync with Autotask. The only way to guarantee the counts is to pull two reports: one from the RMM and one from Autotask, and then do an Excel VLOOKUP to verify.
Then we run into a problem with device usage. Yes, this is a computer we support, but two people use the computer, so do we charge double to support a shared computer? Nope, we maintain devices, not people.
Oh, OK, but we have a spare that may be or may not be online – do we count that? It depends. Is it a monitored hot standby, and if so, are problems maintained? If not, then it most likely is not in the device counts, and therefore we are unable to count it.
Consistency is Key, No Matter the Definition
In both of these areas, the conversations can go on and on with no ironclad answers. Not finding, benchmarking, tracking, and analyzing the data is difficult enough. When you add that no two MSPs can agree on an Endpoint definition, and the tools being used count things differently…even using a RHEM # between MSPs is inaccurate.
What is accurate is that no matter what the definition is - or what the counts are within an MSP - if they are consistent, then moving from a typical .375 (1 hour of work per 3.75 Endpoints) to .1 (1 hour of work per 10 Endpoints) provides the MSP with 275 hours of additional MRR support or Professional Services availability, which is worth $41,000 per 1,000 Endpoints per Year.
Now that you've been introduced to RHEM, I hope you are as excited about it as I am. And hopefully, the math made sense. If not, please reach out to Info@AGMSPCoaching.com. I'll set you up with a FREE No-Obligation PSA Configuration Evaluation to get you started in the right direction.
**FYI: the cost of Advanced Global's Service Delivery Foundational Improvements is priced somewhere between $2,500 and $3,000 per month, depending on the needs of the MSP. How many months? That depends on the how fast the MSP can adapt to change
The elephant in the room:
Who is Advanced Global, and why should we listen to them?
1. Advanced Global MSP Coaching is the Autotask Service Delivery Authority.
2. We Guide MSPs to use more of the Autotask Software to drive Operational Improvements.
3. The first step is a FREE
Get started today. Waiting is costing you $600 per Tech per Week, and we can help you recoup that loss, Guaranteed or your Money Back. For more information, email us at info@AGMSPCoaching.com