In the early days of cloud computing, most channel partners were merely spectators sitting on the sidelines offering advice and whatever assistance they could to their more adventurous customers. Few vendors made room for solution providers in their go-to-market strategies. Some may not have appreciated the channel and its value to customers and end users, while others simply cut out the “middle man (or woman)” in the equation, perhaps to keep control and the profits all to themselves. Whatever the reasoning, we know that approach didn’t favor the channel.
Over the past decade, providers have taken on a much different role in the cloud. A number of the traditional software companies that depended on the channel for distribution and support simply virtualized their offerings and kept their existing relationships, for all intents and purposes, basically the same. Incentives and backend support changed, but the suppliers usually stayed in the shadows and created white-labeled solutions that allowed their partners to be the face customers would see.
A significant number of cloud vendors maintain a direct only route, especially with market-specific or niche applications, while others dabble with a hybrid type of approach. But, as those in our industry segment know all too well, it’s not easy to create a successful channel program when the vendor has mixed allegiances. These rivalries rarely favor the partner and often confuse or infuriate clients and end users.
The reality of that situation is the cloud model, as it is now, may never change, and some providers are still trying to define their role in this space. But there’s good news. Many businesses are now taking a “cloud first” approach with new technology initiatives, according to the CompTIA IT Industry Outlook report, and providers have a lot to offer companies following that strategy. In fact, their needs essentially define the channel’s increasing role in these services, including:
- Cloud assessment/consulting: some scoff at the term “virtual CIO,” but the role is an essential one for small business customers and profitable for the providers who offer it. With the increasing complexity and value of cloud services, most companies realize the need for a “strategist” to guide their policies and procurement procedures for these technologies. The business consulting role isn’t for everyone, especially those who focus entirely on IT, but many providers are expanding their skills in this area through training or hiring.
- Custom design and implementation: this depends greatly on the degree of cloud adoption a business is planning. A viable digital workflow may require attention to various layers of the software stack. Solution could involve integration and customization work, and API development to ensure all the applications connect and communicate as needed.
- Billing: the proverbial “one throat to choke” still applies here. Business customers want simplicity in their systems and their payment options. Whether channel firms create their own billing systems or leverage the cloud platforms offered by distributors and other aggregators, it’s becoming a “must have” for many corporate and SMB clients.
- Support: just like billing, customers often need (or at least want) more help than the cloud suppliers can offer. End users often have simple questions or issues that can be easily solved by a provider who understands their systems, but might take hours for a large call center to address or resolve. The value add comes from the little things, like password resets and new device set up. They may be simple activities for a newly hired tech, but the value of that service to a stressed out end user might be incalculable.
That increasing focus on end users plays to several channel strengths, starting with the close relationships many providers have with their clients. Many channel firms not only have more feet on the street in their communities, but their team members typically have greater interaction with the people who use their technologies. That’s where the real business value of cloud applications is, with end users.
As the newly released CompTIA Trends in Cloud Computing report highlights, many companies have moved into the advanced adoption stage where “refinement” becomes a top objective. The study explained that “ultimately, end users will choose the systems that closest meet their needs for function and cost. Overlooking individual characteristics may lead to a competitive disadvantage, but this is a long-term risk as many companies are still gaining familiarity with virtualization or hosted models”
In other words, the best way to ensure end users have the cloud solutions they need to be productive and at least relatively satisfied with their jobs is to engage them in the design and implementation processes. Channel firms are perfectly positioned to take on that role. The most successful cloud providers are essentially business consultants; identifying customers’ corporate goals, eliciting employee feedback and putting together a technology plan that delivers the best possible outcome. In increasingly more cases, their role included policy and training development, as well as solution design, implementation and long term support.
Channel firms are no longer “bit players” in the cloud ecosystem. In fact, the role they play has never been bigger or more in demand, and the profit opportunities that are available continue to grow. That’s the attitude solution providers need to take in 2016 (and beyond) if they want to be taken seriously. Not only by their customers, but by their suppliers and the competition.
Brian Sherman is Chief Content Officer at GetChanneled, a channel business development and marketing firm. He served previously as chief editor at Business Solutions magazine and senior director of industry alliances with Autotask. Contact Brian at Bsherman@getchanneled.com