When we think of the home of technology, we think of California. It's here, after all, that Apple was founded in 1976 in Cupertino, and HP way back in 1939 in Palo Alto. Countless other tech giants call California home, including Intel in Santa Clara, Oracle in Redwood City, and Salesforce in San Francisco.
So what does this mean for MSPs operating in the state? Is being close to such legendary innovators a boon for MSPs, or does it create challenges that may otherwise not be of concern?
We spoke with players across the state to hear about the top four factors that are having an impact on channel partners running their business in California.
1) A 'self-entitled' workforce?
It's no secret that hiring into the MSP space is difficult. And it's also no secret that salaries in California, and specifically in the Bay Area, are often considerably higher than in other parts of the country. With the cost of living in northern California being one of the highest in the country, according to data released in May 2018 by the Bureau of Economic Analysis, it stands to reason that potential employees expect to earn higher salaries than their counterparts in other parts of the country.
This has a double impact on MSPs. The expectation (and need) for a higher salary means that channel players are expected to compete with big - often huge - tech companies located in the region.
This is compounded by the fact that the high cost of living means potential employees are moving out of the most expensive cities, such as San Francisco and San Jose, and leaving MSPs with a limited pool from which to choose in the first place.
"It can be difficult for an MSP of any size to obtain and retain high-level talent when there are other, larger companies out this way that can afford to pay more," Joel Couch, president at Redlands, CA-based Dynamic Technical Solutions, told CPI.
This also leads to a low unemployment rate, which contributes to the shift in both mindset and expectations from potential employees, putting MSPs in a tricky situation.
In the Bay Area in particular, MSPs may find themselves dealing with candidates who have set expectations, regardless of the size or type of company they're applying to.
"Because the unemployment rate is so low, there's an increased importance for many companies to emphasize culture, benefits and extraneous things that will encourage recruitment and retention," said Rob Schenk, partner at San Francisco-based Intivix.
"It feels a little more employee-centric, with a definite importance placed on work-life balance and a bit of a different work ethic."
Another Bay Area MSP observed that, in the Midwest, there is a "pull up your bootstraps and get on with it" work ethic, which "seems to be a bit more ingrained".
"But when you get out to the coast and these kind of concentrated metro areas, the mentality of the worker is a bit different," he added.
Couch agrees. He notes that, generally speaking, potential employees want "every perk" they have been offered by other potential employers.
"They expect every advantage that every other company would give. So maybe I give a benefit that is unique from the benefit that you give - well, they'd want both of those benefits. Everything that they hear anybody ever having - a sense of entitlement is absolutely the case."
Article continues on the next page...
Some say performance, others say money but it may be systems and processes that carry the day
Japanese vendor sells product development, manufacturing and logistics base in Bavaria to S&T subsidiary, Kontron
'MSPs are all scared to death. They don't want end users asking, what am I paying you for?' - Datto CEO
Tim Weller tells CPI that he sees MSPs struggling to update how they package and deliver security, and opens up on what he makes of MSPs trying to rebrand as MSSPs
In its Q4 results, Microsoft reveals its cloud unit is now its biggest business segment