Differentiation and the MSP Value Proposition
By Ian Richardson, Principal Consultant, Fox & Crow Group
I “grew up” in the Information Technology industry. My first job was at Lansing Community College in Michigan, working days to pay for night classes. I also had the rare opportunity to help my father install one of the first electronic medical records systems in Michigan. Those early projects—and the mentors who guided me—shaped an 18-year I.T. career that ultimately led to the creation of Fox & Crow.
One lesson has stuck with me throughout that journey: differentiation requires innovation. For MSPs, that principle is more relevant than ever in today’s saturated and increasingly commoditized market.
What Does Differentiation Mean for MSPs?
Differentiation answers the question, “Why should a client choose your MSP over another?”
Innovation answers that question with action—through delivery, positioning, packaging, or the client experience itself.
Innovation becomes the basis for your MSP value proposition.
But here’s the problem: if your services are equal to or better than your competitors, and you're still losing head-to-head deals, the issue likely isn’t your delivery. It’s your messaging. When your offer sounds like everyone else’s, it becomes invisible. And when prospects can’t see a clear reason to choose you, they won’t.
In my experience, real differentiation comes from aligning how you talk about your services with how you actually deliver them. That alignment is what builds confidence in the buying process. If you need a starting point, How We Sell Managed IT breaks down one way to infuse structure and clarity into your pitch.
A Drucker-Inspired Lens on MSP Value
Peter Drucker’s work on knowledge organizations helps frame this challenge.
In “The Coming of the New Organization,” he said:
“In an information-based organization, everyone must take ownership of information responsibility.”
He explained this through simple examples: musicians being responsible for playing in key, healthcare workers ensuring accurate records, public officials submitting reliable reports.
But Drucker also posed a harder question:
“If we did not do [our current service offering] today, would we still choose to go into it, knowing what we know now?”
That question hits hard for MSPs with legacy service models or stale positioning.
If your offer doesn’t survive that test, it’s a sign your MSP value proposition needs to evolve.
Questions to Pressure-Test Your Offer
Is your current message really capturing what clients care about? Consider these:
What reasons are clients choosing other providers?
What unique value do you offer that no one else is highlighting?
What customer needs could you address that your competition ignores?
Is that a solution you can deliver well?
Would it be profitable to launch or improve?
Is your current service commoditized or losing pricing power?
These questions are strategic—not just sales-related. They cut to the heart of whether your MSP has a real positioning edge, or is simply blending into the noise.
If you’re struggling to turn clear service delivery into effective differentiation, your value proposition is likely misaligned. Why MSP Marketing Efforts Fail is a helpful read to unpack where your message might be falling short.
When to Evolve or Abandon a Service Model
There’s no universal rule for when to walk away from a stagnant offering. In client conversations, I’ve seen this tipping point triggered by plateauing growth, declining profitability, or a lack of belief in the work being done.
If you’re feeling that tension, start with analysis. Look at the opportunity cost of maintaining the current offer. Talk with your team about how they feel delivering it. Create a short list of ideas that energize your people and align with the market. Then evaluate each based on cost, complexity, time-to-launch, and long-term client value.
Need help thinking this through?
Start with these 7 tips for MSP business success—they’re a solid foundation for evaluating both performance and direction.
Also, don’t overlook trust as a differentiator.
When your internal and external messaging align, the result is credibility. Operationalizing trust is what gives prospects confidence to say “yes.”
Learn more about operationalizing trust on the WIN Podcast featuring Andrew Moore.
Ready to Rethink Your Value Proposition?
If your team isn’t sure what makes you different—or you’ve outgrown your original pitch—now is the right time to reset. A stronger MSP value proposition leads to better clients, more confident conversations, and sustainable growth.
Book a strategy session with me and let’s map out your next best move.
Frequently Asked Questions About the MSP Value Proposition
What is an MSP value proposition?
It’s the unique reason a client should choose your managed services over competitors—typically grounded in how you solve pain points better, faster, or differently.
How do I know if my value proposition is outdated?
If you’re losing deals even when your service is solid, or if your pitch feels generic, it’s time to revisit what you’re communicating and why.
What causes MSP value props to fail?
Usually, it's lack of clarity, lack of differentiation, or messaging that’s disconnected from what clients actually care about.
How do I rebuild a stronger value proposition?
Use customer feedback, competitive intelligence, and team input to reframe your strengths. Position around outcomes, not just tools or hours.
Is a great value proposition really enough?
Not on its own. It has to be paired with credibility and alignment between message and delivery. That’s what builds trust—and closes deals.
