What are Autotask PSA contracts?
These are predefined relationships when your business is working with another organization. One popular type of contract in one industry may not be ideal for another. In our active Autotask PSA contracts setup for many of our clients, we request that they pay two hours up front for a block hour purchase. This Block Hour Service contract intentionally scares off certain would-be prospective clients because we want to attract only certain types of organizations that are willing to pay for our services an ongoing basis.
Software Enforcement of a Contract
A legal contract for service is pretty much useless if you don’t have the software to enforce it. For instance, the Block Hour contract we setup for most of our organization we support requires money up front. Once the credit is used, we then charge x dollars an hour and invoice on .25 hour basis. Our PSA ticketing system must know the Autotask contracts type, how to produce time entries, and notify our AR team once the ticket is complete.
Block Hour Purchase Contract
The Block Hour Purchase contract is one of many Autotask contracts that we use run our business. There are legacy Autotask contracts such as a retainer contract that we are less likely to indulge use in future clientele. Unfortunately, we have found that this contract like Block Hour Contract is a reactive break/fix relationship over the long run is bad for business. The client initially loves this pay as you go relationship but the relationship sours over time or overnight because of some catastrophic event. The once affordable contract now requires almost daily or weekly renewals of that block hour or retainer purchase. The costs add up quickly and the relationship goes south. Retainer purchases are better spent for consulting services, not reactive or “Break/Fix” IT related issues.
Break Fix Type Contracts vs Recurring
These “Break/Fix” related contracts such as a retainer or a block hour purchase contracts may serve an initial purpose of establishing know, like, and trust for your services but will ultimately be disastrous for almost all organizations long term because the nature of the react-only relationship in the IT industry. Reacting postpones the inevitable. Meanwhile, these issues that fester only get worse and may be catastrophic to the business.
The nature of how a contract uniquely functions can make or break a business. We want a contract that nurtures the relationship if we have any chance of retaining the client long term. The key elements for making this happen is a proactive and monthly recurring relationship. You are maintaining client’s environments with a stack of services. Your “stack” (a very IT specific term) and your team is the core or what makes your business a managed service provider or MSP.
Manage services come in the form of recurring service Autotask contracts. The volatility of the relationship is stabilized on both ends with the client knows the amount they are paying on a monthly basis is relatively the same unless there’s significant growth or downsizing of the company. The legal contract as well as the PSA actually dynamically manages the per user cost of doing business.
Autotask Contracts Summary
A service industry legal contract is only the written mandate of what we plan to do. Something like Professional Services Automation system is the only way to actually enforce it. Dive deep learning this beast or find a trained professional that can perform the work for you.