Understanding Your MSP Contract

When partnering with a managed service provider (MSP), businesses often enter into contracts called service level agreements (SLA) that outline the terms of the relationship. These contracts can sometimes seem daunting, especially when you’re unsure if you’re getting the best value or your needs have changed.

If you feel trapped in a less-than-ideal relationship or you’re not getting the managed IT services agreed upon, you’re not alone. Many companies find themselves questioning the terms of their MSP contract.

Let’s explore your MSP contract and how you can discuss it with your MSP.

Read: What Makes a Top-Notch Managed Service Provider?

Am I Bound to My Contract with My MSP?

When you sign an SLA with an MSP, you are legally bound to the terms and conditions outlined in the agreement. Every company will have a unique SLA that details the terms of their contract. These contracts typically include:

• Contract length: Specifies the length of the time the agreement is in effect, which can range from a few months to several years.
• Services provided: Details the specific services the MSP will provide, like managed IT or cybersecurity.
• Payment terms: Outlines how and when payments will be made to the MSP.
• Termination clauses: Describes under what circumstances the contract can be terminated by either party, such as breaches of contract, unsatisfactory service or significant changes in business needs.

Can I Get Out of My MSP Contract?

Exiting a contract with an MSP isn’t always straightforward, but it can be done under certain conditions. Here are a few scenarios where you might be able to exit your contract:

• Breach of contract: If the MSP consistently fails to deliver the agreed-upon services, you may have grounds to terminate the contract. Document all instances of non-compliance to support your case.
• Negotiation: Sometimes, discussing your concerns with the MSP can lead to a mutual agreement to terminate the contract. This might involve paying a penalty or settling any outstanding obligations.
• Buyout options: Some contracts might offer a buyout clause, allowing you to exit if you pay a predefined fee.

Keep in mind that MSPs value their reputation, so they will often work with you to achieve the best outcome for everyone involved. That’s why most SLAs will include a 30 to 90-day termination clause, allowing them time to try and alleviate your problems with them before ending the SLA. Review your contract for any clauses that allow for early termination, including any early termination fees or penalties.

Read: 9 Tips on Choosing the Right Managed Service Provider (MSP)

Signs It Might Be Time to Leave Your MSP

Recognizing when it’s time to part ways with your current MSP can be challenging, but certain red flags can indicate when to reevaluate your relationship. If you’re experiencing many of these issues, it might be time to explore other MSP options.

• Consistent service failures: Your MSP should quickly respond to your IT issues to prevent downtime and slow response times. It might be time for a change if your MSP frequently fails to resolve IT issues promptly.
• Lack of proactive support: A good MSP should not only respond to issues but also proactively monitor and manage your IT environment to prevent problems before they occur. If they’re consistently behind the curve, it might be time for a change.
• Poor communication: Effective communication is crucial for a successful partnership. If your MSP is difficult to reach or fails to provide regular updates on resolving issues, it could hinder your business operations and productivity.
• Inflexibility: As your business grows and evolves, your MSP should be able to adapt to your changing needs and structure. If they’re unable or unwilling to scale their services accordingly, it might be holding you back.
• Cost vs. value: If the cost of your MSP’s services outweighs the benefits, it might be time to reassess whether you’re getting the best value for your investment.
• Security concerns: Inadequate security measures or failure to keep up with the latest cybersecurity best practices can put your company at risk of data breaches or cyber attacks.

Strategies for Talking to Your MSP About Your Contract

When discussing your contract with your MSP, it’s essential to approach the conversation professionally and constructively; open and honest communication is key, and it can lead to improvements in service or a smooth transition to a new provider. Remember, maintaining a positive relationship with your MSP can be beneficial, even if you decide to part ways.

Here are some tips on how to talk to your MSP:

• Review your contract thoroughly: Before initiating the conversation, ensure you fully understand the terms and conditions of your contract. Highlight any areas where you feel the MSP has not met their contracted obligations.
• Schedule a meeting: Request a formal meeting with your MSP to discuss your concerns. Prepare an agenda to ensure all critical points are covered.
• Understand your MSP’s perspective: When meeting with your MSP, try to see things from their point of view; this can help you eventually find common ground.
• Define your concerns clearly: Identify specific issues with the service or contract you want to address. This might include service delivery problems, changes in your business needs or financial constraints. Clearly bringing up your concerns gives the MSP a chance to resolve them; they can’t fix what they don’t know is broken.
• Propose solutions: Rather than only stating problems, offer potential solutions or compromises. This shows your willingness to work collaboratively toward a resolution. Perhaps there’s an opportunity to modify the contract or adjust service levels.
• Be open to negotiation: Be prepared to negotiate terms, whether it’s a reduction in services, a revised payment schedule or an exit strategy.
• Document the conversation: Keep a record of the meeting, including dates, participants and key points discussed. If you do decide to end your MSP contract, note what this entails.

Read: Transitioning to an Outsourced IT Provider

Thriveon as Your MSP

If you’re looking for an award-winning MSP with robust services and experienced staff, consider Thriveon. For over 20 years, we have helped our clients align to over 500 industry best practices that ensure a 90% reduction in IT issues and security vulnerabilities.

To see how Thriveon can help you, schedule a meeting with us now.