MSPs: Your billing system should not be sitting at their own desk

MSPs: Your billing system should not be sitting at their own desk Patrick Elliott is the VP of marketing at

Despite the economic setbacks shaped by the pandemic, demand for cloud communications services continues to grow. The remote “work-life” arrangement and increased displacement of face-to-face meetings by video conferences has managed service provider (MSP) leaders clamoring to take advantage.

On the downside, this heightened activity has exposed the flaws or outright failures of the billing processes for many MSPs. In fact, “processes” may be too technical a term for how some MSPs handle their billing. There’s a name for the “process” such companies use. It varies from one company to another; it may be “Bob” or “Mary.” That’s right: it’s the name of the person who manually pulls data to process every invoice. This may have been manageable in years past but given the elevated need and added billing complexity of cloud communications, MSPs need a more scalable option.

Even the largest and most experienced billing staff, following the most well-designed procedures, may still be destined for failure in a manual environment. Every person in a billing department that does manual invoicing is going to inevitably make a mistake. The more bills that need to go out, the higher the odds of errors. Factor in the expected growth that many MSPs count on in selling complex, recurring services, and the downside risk from errors only gets larger.

For any company paying attention to their financials (which is every single one), this kind of risk should be unacceptable. Given the nature of subscription billing, a mistake can easily get “baked into” the system. Theoretically, even a manual billing process is a routine: the same steps followed the same way every time. So, when the function fails, one of two things happens:

1) If the mistake is a recurring data entry error that isn’t closely audited, that same error will be applied ad nauseum until somebody spots it and corrects it.

2) If the mistake is at a step that must be repeated the following billing period, it may get corrected at that time.

Now the question is: Did the mistake cost you money? (Confession time: This is a rhetorical question.) Are you going to go back to the customer and ask for that money? Not likely. Hopefully, you didn’t lose too much.

If the mistake costs the customer money, there’s a great chance you’re going to hear about it sooner or later. And you know how much account management time costs, not to mention whatever goodwill gets expended on setting things right. In the end, one way or another, every billing error costs you money.

The solution is an automated subscription billing platform. Such a system is designed to streamline resources, control operating expenses, maximize profitability and enable MSPs to scale their business growth.

A subscription billing platform minimizes OPEX by dramatically reducing the management hours required for processing invoices. These time-savings occur in both the areas of routine processing and error-checking. Plus, your skilled team members can devote their time to more strategic tasks.

Because such systems integrate with the rest of the back-office operations, the data collection and file hand-offs required for each run are seamless. This eliminates the most significant potential point of failure. Furthermore, this tight integration enables automated error-checking. In effect, two steps become one. Finally, all these time and effort savings eliminate the need for linear headcount growth as your business grows.

This is one contributing factor to the increased profitability such systems deliver. But they also help in increasing new business’ contributions to the bottom line. An automated subscription billing platform is designed to simplify and systematize the onboarding of new customers and processing of add/change requests. They assure that nothing goes unaccounted for.

And naturally, it enables the growth of your business. The less grunt work your team is tasked with, the more business they can drive and process. Automated systems scale effortlessly, handling whatever volume you pour into them, even from giant new accounts with complex requirements. A frictionless billing process translates through the entire organization so that customer and revenue growth come with no attendant headaches.

When it comes to your team, there’s an upside that’s difficult to quantify, but undeniable: Although your staff doesn’t have to do work that a machine should be doing, they are happier, more productive and better ambassadors for the company.

Suddenly, Bob and Mary are no longer “the system,” which they will certainly appreciate.

Photo by Glenn Carstens-Peters on Unsplash

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