My IT Service Provider Blows. Can I Just Fire Them?

The short answer: maybe.

So, you hired a new IT service company. Their sales guy was super nice (or maybe persistent is the better word?) and they told you about all the cool tech tools they provide under their managed service agreements and how all your tech woes would be gone in an instant. The fancy terminology they used sounded great and you could tell they knew their stuff. You signed the contract (without fully reading it, dare I say). Fast forward 6 months and you realize that the support you thought you were signing up for ain’t all that great! No big deal, right? We’ll just go our separate ways and try one of the next 5 companies we got quotes from.

Unfortunately, it might not be that easy, which is probably why you’re here reading this post. The sales guy told you the pricing was better for a 3-year agreement, didn’t he? He also told you that if they didn’t meet their obligations, you could cancel, right? Well, did you read (and understand) the stipulations of how that works?

Let’s take a look at the important pieces of a typical managed service contract.

The Termination Clause

This is the most important part of the contract to look at. This is where you’ll find the specifics of how you can cancel the contract, as well as the consequences if you can’t cancel it on their terms.

Most MSP contracts will say something along the lines of “Unless agreed by both parties in writing, or otherwise permitted by this agreement, neither party will terminate this agreement without cause” and “if you terminate this agreement without cause, you will be responsible for paying the termination fee.”

Ok, great, no big deal, we’ll just pay that pesky termination fee and I’ll have learned my lesson, right? Then you read on to find out that the “termination fee” is equal to “all amounts that would have been paid had this agreement remained in effect.”

Wait. What? So, you’re telling me to cancel the remaining 30 months of the 36-month contract at $1,000 per month, I would have to PAY $30,000 TO CANCEL?!

Well, when you say it like that, it does sound kind of bad I suppose.

Ok, so we’ve established that the termination fee is way too prohibitive to use that method if there is a lot of time remaining in the contract term. What other options do we have? The next thing to look at would be cancelling for cause.

The Service Provider’s Obligations (SLA, Service Level Agreement, etc)

The main portion of a contract that could give you some ammo to terminate “for cause” is what’s called an SLA or Service Level Agreement. This is the portion of the contract that states their guaranteed response times. Most MSPs have an SLA these days and it will tell you how fast they promise to respond to your support tickets.

Sounds great that they have a guarantee, but does that really mean the support you’re getting will meet expectations?

For example, many response time guarantees for critical tickets will be 1 hour. An example of this type of ticket would be that the server or network is down. Nobody in the office can do their work. Crap. Ok, well the IT company will have it fixed in about an hour, not too big of a deal. 59 minutes after logging the support request, an email comes in that “Hey, we got your ticket and we’re looking into the issue.”

Another hour passes by, then two, then three. It’s lunch time and nobody has gotten any work done and we don’t even have a clue if they’ve made progress on getting us back up and running. Maybe they get it fixed before everyone returns from lunch, or maybe it takes 2 more days, either way they technically lived up to their obligations under the SLA because they “responded” in less than the guaranteed 1-hour response time.

This is not even to mention that some of the lesser priority response time guarantees could be as much as 8 hours. And how do they determine what issues fall into the various priority levels? Well, that’s usually up to the MSPs discretion.

The next obligation you could look at under the contract would be whether they’ve actually delivered all the services that they promised. I’m not going to go into this one too much, because many of those will be obvious when you read them. However, it’s not too uncommon that the contract states these things in a very technical manner that business owners with no technical background might not understand, so how are you supposed to know whether they actually delivered them? My advice would be to find an outside advisor that can help you break down the specifics of those services that are supposed to be delivered to determine if you’re really getting what you pay for.

Additionally, I have seen in many contracts that these requirements are spelled out in a vague manner, so it’s not hard for the provider to meet their obligations while still providing crappy service.

If you are able to pinpoint a way in which the provider hasn’t met their obligation, usually there is another stipulation that you have to give them 30 days to remedy the situation. All of these various conditions can make it difficult to “just get out of” the contract when you’ve decided that you’re over it and this company will never live up to your expectations.

So I’m Stuck, Now What?

Once you’ve realized that this isn’t going to be as easy as you thought, it’s time to drop back and punt.

The first thing to try is to ask them if they will let you out of the contract. Most business owners are keenly interested in customer satisfaction and if there is a customer that’s truly not happy, there’s a good chance they will reason with you and accept a cancellation without paying that ridiculous termination fee, or they may be willing to negotiate a more reasonable amount, which will obviously depend on how much time remains in the contract term.

In my opinion, the best way to navigate this scenario is to make some noise. If you raise a complaint with your account manager every time the support doesn’t live up to your expectations, hopefully one of 2 things will happen. Either they will get tired of hearing you complain and let you out of the contract, or they’ll take steps to improve their support to make you happy. You win either way.

Additionally, documentation is key. If there are instances where they’re not meeting their contractual obligations, you need to document that every time, so you have a paper trail to point to when you decide it’s time to negotiate out of the contract.

The Importance of Trust and Transparency

One of the primary topics you’ll hear me harp on is how important trust is when it comes to choosing an IT provider, or even if you’re hiring an IT guy in-house, trust is a critical component to look for. If you get a bad vibe from a sales guy or the feeling that you’re being sold something you don’t need, either walk away from the deal or ask more questions to get an explanation of why you need that solution and how it’s going to help your business.

Business leaders are overwhelmed by the world of technology, and specifically in today’s environment, with cybersecurity, so they will just choose the option of throwing money at it to get it off their plate, many times just choosing the cheapest option. Unfortunately, there’s a high probability of letdown without doing more due diligence, asking questions about terms, and even checking into references.

At CoreSouth, we want you to trust us to guide you through the modern technology challenges that businesses face and we welcome your questions. We’ll do our best to explain things in the simplest manner possible and we’re happy to offer our advice, even if you’re not our customer yet. Call us today or Schedule an Intro Call.