Fast Growth
By Jennifer Bosavage
Gov't Customers Demand Tech Solutions Support the Big Picture
May 16, 2012
No matter what the "coolness factor" of a technology is, when selling to the government, the focus is on how the soution will help a department reach its goal. Forget the whiz-bang gizmos, and get down to brass tacks, says Liesegang, vice president of the Government Channels division at immixGroup. In this second installment, Liesegang discusses how to sell IT solutions to government customers.—Jennifer Bosavage, editor
Federal policy, procurement changes, and budget drivers are having a real effect on how government agencies must adapt to fulfill critical mission initiatives. Consolidation is underway to address existing policies and initiatives, and new programs may not gain much traction.
The ultimate goal in selling IT solutions is to reduce the federal deficit and to generate real budget savings. It’s important to note, however, that some things in the federal government must never change –most notably, the mission critical objectives that every agency and department must support in its services to citizens and the warfighter.
For the government, technology is a critical bridge for maintaining mission objectives even when budgets are reduced or consolidated overall. The financial benefit of federal policy and budget evaluations, then, will likely be directed to technology solutions for maintaining current levels of performance and meeting mission critical objectives within agencies and departments.
In part 1 of this series, we looked at the policy drivers that are changing accountability and risk management for technology companies, systems integrators and VARs. In this installment, we’ll look at some general ways that technology can help meet mission critical requirements, and set the stage for a deeper look at trends in technology buying for 2012 and beyond.
An example of how technology will help agencies meet mission objectives despite reduced budgets is the Farm Service Agency at USDA. That agency plans to close 150 offices as part of a cost savings effort that will cut 400 USDA locations across the department. Besides relocating people, USDA will rely more on telework and mobility, consolidating cell phone and other technical services contracts, and unifying email in the cloud. That presents an opportunity for selling IT solutions through a scalable and secure technology.
The Office of Management and Budget also is pushing to reduce infrastructure costs, freeing up budget for “innovation development." OMB advocates continued use of “TechStat” review sessions and a cloud-first policy toward new IT (including emphasizing shared services). They are also promoting a government-wide approach to mobility and mobility services, starting with an online forum to solicit ideas, such as a single portal at which agencies can acquire mobility goods and services. To be successful selling IT solutions to the government, you must demonstrate how you will support the mission, while ultimately reducing cost.
Vendors, resellers, and systems integrators must begin positioning sales to government as a continuation of existing mission critical programs or objectives. That is a strategic means of ensuring sales through periods of budgetary continuing resolutions. ROI and the effectiveness of solutions to support the mission are key.
As a technology company, how does this affect your go-to-market strategies in the government channel? First, technology value propositions have to be crystal clear, in a way that relates to government missions. No longer are decisions going to be made based simply on who has the lowest price. In short, you will really need to know your customer at a deeper lever than before.
A technology value proposition for government must include understanding the agency mission, the program focuses, the originating source of programs that support missions, and how the technology supports those missions.
Now, how do you plan on selling products and solutions into the agency? That starts with strong relationships. VARs and systems integrators must have access to the lines of business within government. Often, the systems integrators themselves run those lines of business and programs. So in some cases, you may be working with both the government program manager as well as a systems integrator program manager. As we discussed in our last installment, technology companies need to understand whether they are selling with the systems integrator or through the systems integrator.
Another way of ensuring success is to partner with companies that have past experience selling into multiple agencies. If the government agency buyer has confidence that your partner is selling appropriate solutions, they will likely ask about other agencies for which this work has been done. This may require your partner to bring you in to speak with program executives and discuss how you will be able to support their missions in this time of reduced budgeting.
Selling to the government means thoroughly explaining how the buying agency will be able to cut costs through the effective use of IT–while not sacrificing the government mission. Based on existing federal IT procurement policies, that may mean selling cloud-based or subscription services, which ultimately are far more scalable and secure, and could lead to appreciable cost reductions. New service models will arise and you will need to understand them.
The key will be to understand agency mission objectives, the role of the VAR or systems integrator in fulfilling those mission objectives, and how your technology can maintain those objectives even when budgets are reduced and consolidated. Follow that formula, and you’ll boost your odds of selling effectively into government today.
Next Wednesday, we’ll take a deeper look at trends in technology buying for 2012 and beyond.
Shared Risk Takes Center Stage In Federal Policy, Channel Sales
May 09, 2012
Now more than ever, solution providers and their vendors need to work together to bring product-focused solutions to their government partners. With this four-part series, Liesegang, vice president of the government channels division of immixGroup, looks at how new realities in policy are driving federal business and how that affects government missions and technology.—Jennifer Bosavage, editor
Federal channel players, and manufacturers—especially smaller companies just getting started in the government channel—don't routinely keep a keen eye on federal policy. When selling to the government, they're usually looking at how to bring technology into the federal government with go-to-market strategies that are product-focused, rather than solution-focused.
In the changing federal procurement environment, that’s no longer the best strategy. The federal government is enacting new policies that will require systems integrators and prime contractors to assume much greater risk in satisfying contract awards when selling to the government. Firm fixed-price contracts and contractor accountability will be the focus for how companies interact with the government and fulfill the contracts they’ve won.
Here's a quick overview of the federal policy landscape. Here’s what’s happening:
Quality accountability: Look for more open-ended liability demands on contractors. For example, a new type of clause has entered into government contract awards. Called “Contractor Accountability for Quality,” the provision lets the agency cut or withhold fee payments if the contractor uses bad parts or fails to use best practices.
With that open-ended liability, contractors will want to see accountability trickling all the way down to the people who provide the component parts for contract awards. VARs may become less inclined to use a “white box” solution, because they don’t fully understand the sourcing of all the components. They may instead choose to stick with more mainstream solution, where the supply chain is clearer.
What does that mean for you? Secure the supply chain. You’ll need to understand your complete supply chain like never before. Make sure that your processes – from manufacturing of parts to the government end user – are streamlined. Know all the players, and ensure that they are reputable.
Firm, fixed-price contracts: The Federal Acquisition Reform (FAR) Council, working under guidance from the Office of Federal Procurement Policy, is calling for contracts that require the contractor to deliver commercial services fully to the government’s satisfaction in any contract award. It’s all about teamwork here. Especially on the firm-fixed price portions of government contracts, integrators and VARs will want to build a team of subcontractors that will entertain shared risk, have solutions to mitigate that risk, and can move forward as a fully invested team player.
Best practices in interagency procurement: The FAR Council is now requiring written justification and determination that the contracting vehicle for any given interagency contract is the “best procurement approach” of all possible options.
Selling into the federal government today means having much greater awareness of how the procurement process works, to make certain that you are working with partners who fully understand the process. You don’t want to be mired in countless revisions to proposals—or worse yet, lose out on proposals because your upstream partners may not have a full grasp of what's needed to win.
In today's policy environment, shared responsibility is true not only for contractors but also for subcontractors. Whether working with systems integrators as end users of a product or through systems integrators purchasing solutions on behalf of a government agency, these policy changes will have an impact in areas of cost and accountability overall. Because systems integrators, VARs and prime contractors have to look at policy more closely than ever, they’ll need to work with channel partners to ensure shared risk – a factor that smaller technology companies and subcontractors may not have had to consider before.
So federal policy and budget drivers are having a real effect on how government agencies will fulfill critical mission initiatives, and how the contracting community must adapt. Next Wednesday, we’ll look at some general ways technology can assist in meeting mission critical requirements for 2012 and beyond.
Strategic Partnerships – Diversify or Die
March 01, 2012
This is the final in a series of blogs from top execs at CRN Fast Growth companies. Virtual Graffiti, number 50 on our list, grew 76 percent between 2008 and 2010. Here, Ellison, Creative Director at Virtual Graffiti discusses the art of choosing the perfect partner mix. -- Jennifer Bosavage, editor.
Choosing the right partners can be a difficult task. While decisions are often market driven, resellers should build a diversified product portfolio for stability. Simply put, don’t have all of your eggs in one basket – branch out and find both competitive and complementary solutions to offer to your customers. Here are several things to review when finding new partnerships with vendors:
Big vs. Small Brands
Long established brands are first to come to mind when customers are looking to make a new purchase. With huge marketing budgets, key customer accounts and a solid product line, these big brands have many advantages over their smaller competitors. Forming partnerships with big brands allows you to quickly establish a significant customer base with the potential for huge opportunities. Sounds great right? Well, big brands also tend to have a large channel of hundreds of resellers just like yourself all fighting for those customers. Resellers also might struggle to make larger profit margins in a saturated channel.
On the other hand, smaller brands and start ups can present a fantastic opportunity to offer an alternative solution to your customer. These companies tend to have leaner business structures and can win both on price and customer account management. While smaller brands offer these advantages, customers are often hesitant to go with unfamiliar products. Resellers need to use a more aggressive sales approach to convince customers they are making the right purchase.
[Related: Virtual Graffiti on "Software Migration Simplified."]
Everything but the Kitchen Sink
While your company may focus on a particular segment, customers enjoy a single one stop shop for their entire technology infrastructure. Complementary solutions are a great add-on sale in most cases. Selling storage? The customer might need additional networking products. Selling security? Suggest a power management solution to keep the network up and running. Having a broad portfolio also provides resellers the ability to turn smaller deals into larger ones and gives exposure to lesser known product lines with larger profit margins.
We’re in this Together
Always remind yourself that these are partnerships. Your goal is provide solutions to your customers – the partner’s goal is to sell their solution. Look for partners with a strong channel focus with multiple sales and marketing tools set up for you to find success. This includes cooperative marketing opportunities and collateral, pricelists and sales quote calculators, outside and inside sales engineers, product demos, deal registration programs, product training and certification and so on. You want to leverage these resources – especially during the early stages of the partnership. Their commitment to you will allow you to succeed.
Choosing the right partners will ultimately benefit the overall growth of your business. At Virtual Graffiti, our strategic partners have been a strong contributor to our thriving growth. We now have more than 120 partnerships with industry leading brands. While we view security as our specialty, recent complementary partnerships have shaped our business into a full IT network solutions provider. VARs can achieve similar success by reviewing these characteristics and applying them when choosing their next strategic partner.
Software Migration Simplified
January 23, 2012
This is one in a series of blogs from top execs at CRN Fast Growth companies. Virtual Graffiti, number 50 on our list, grew 76 percent between 2008 and 2010. Here, Sackstein discusses how to lessen the burdens of software migration. -- Jennifer Bosavage, editor.
For any business, migrating from one software system to another presents a host of challenges which only increase with the complexity of the system and its centrality to a company’s core processes. A migration might be as seemingly straightforward as a FAX-software upgrade or as daunting and intricate as a move to a new ERP or CRM platform.
In any case, the process is never pain-free. Even a switch from OpenOffice.org to Microsoft Office can introduce thorny issues such as document incompatibility, the need for hardware upgrades, end-user retraining, etc., but the application of a few basic principles can go a long way toward easing the move from the old to the new (or the broken to the fixed).
1. Understand Your Business Needs and Identify the Problems
This is the most critical stage of any software migration process – and the stage where many companies stumble. Without asking the correct questions, you’ll never determine your core business needs and precisely where your current software falls short.
So first, clearly define and document the pain-points with your existing product. What functionality does your current platform fail to provide, and how important is it? Involve your entire management team. Be brutally honest. Determine what is absolutely necessary to your business, and what is “nice to have” or “maybe, but in the future.” It’s okay to look ahead five years, but your new solution will likely be obsolete by then anyway.
2. Audition Several Solutions Before Making a Decision
The temptation at this point is to avoid the endless parade of marketing guys with 60-slide PowerPoint presentations documenting in exhaustive detail their “game changing” technology. These can be beneficial, if for no other reason than to clarify what features you don’t want. In reality, the more competing solutions you look at, the much better your chances are of finding the perfect (or close-to-perfect) fit. And the solution might be in a place you hadn’t anticipated.
Once you’ve settled on two or three front-runners, you’ll need to commit to some serious testing, ideally in your own environment with evaluation copies of the products. While in evaluation mode, don’t be hypnotized by shiny new features if they don’t satisfy some part of your core business need. Keep your focus on the features which are absolutely essential to your business. Ensure that your solution meets as many of your documented needs as possible. Evaluate the potential solutions against predetermined criteria: Will this solution cause unintended effects in your current processes or infrastructure? How easy will it be to add new functionality? How well-documented is the API? If, for example, you need to add “print to PDF,” will it require hiring expensive consultants or can your in-house development team handle it?
You’re in a hurry, of course. You’re not happy with what you have. You’re tempted to rush this step and go with the first product that meets most of your needs. Or the least pricey. Resist that urge. Remember that the cheapest and quickest solution is the one you’ve already got, and you don’t want it anymore.
Whether you go with a third-party implementation partner or manage your migration in-house – or combine the two approaches – how you assemble your team and who manages it is often the difference between a six-week success and a six-month morass. The project manager is the crucial role here, because she’ll be responsible for drafting the project plan and schedule, while managing the team and ensuring that milestones are met on budget and on time. Remember: Unless you’re shooting to go live in March, 2015, there can be only one project manager.
3. Pitching the Benefits and Getting Employee Buy-in
After weeks of planning and several 60-hour workweeks, your migration is complete.
Right?
Wrong. What comes next is in many ways more difficult.
Your staff will be resistant to change, as most people are. The move to your new software platform has inevitably led to changes in corporate policies, workflows and processes. Entire jobs have been eliminated or completely transformed and several new roles have been created.
You’ve created a political nightmare, because people fear what they don’t understand, and you’ll need to manage this fear by presenting a united front in support of the new solution and your staff’s new roles. Targeted training and constant communication will go a long way toward ameliorating this. Your employees won’t know you’ve streamlined a formerly-cumbersome process unless you show them. The more familiar your employees are with the new features of the replacement product, the more likely they are to embrace it.
By clearly identifying your core business needs, mapping them to your proposed new solution and managing the deployment and inevitable uncertainty to follow, you’ll significantly increase your chances of a win-win scenario for your staff and your company.
Create a Culture of Urgency
December 27, 2011
Aaron Nack is Chief Operations Officer at Ahead, the #2-ranked company on CRN’s Fast Growth 2011 list.
If I had to write a formula for a VAR’s success, I would say it’s 5 percent the products you select, and 95 percent the people you hire. That emphasis on employees makes it crucial to have a framework for the culture you want to create and maintain, especially when you’re in hyper-growth mode. At Ahead, we define our culture by core operating principles, including one that’s built into our corporate DNA: “Do what you say you’re going to do—and do it NOW.”
Procrastination is part of human nature and essentially stems from a fear of failure. But what if you knew that the ultimate failure would be failing to take action? You’d be free to do what you needed to do. Empowerment and courage are at the core of our culture. We reward daring and decisive actions, creating a sense of urgency. Yes, there may be “mistakes,” but when your employees are as highly skilled and experienced as ours, the only serious mistake is inaction based on fear.
Ahead’s revenue have exploded from $3 million to $121 million in four years on the strength of factors such as next-generation data center technologies and a client-centric organizational structure that eliminates traditional product silos. Admittedly, given the seismic impact of technologies such as cloud and virtualization that form the pillars of our business, some of that growth is a matter of being in the right place at the right time.
But none of that would matter if we didn’t also treat every sales inquiry, implementation and bump in the road as a #1 priority – even if we have a few dozen #1 priorities every day. Responding quickly and communicating regularly creates an environment that shows you care. That not only closes business but helps create a client for life.
For us, that means delivering a statement of work within 24 to 36 hours of determining the prospect’s business requirements instead of waiting two or three days. Calling a client back immediately instead of two or three hours later. Pulling out all the stops to meet a deadline or address a problem.
In one case, for example, we shrunk a four- to six-month project down to four weeks for a client that had to accelerate a planned data center move and upgrade because they acquired a new business. Our project management team moved mountains to make it happen because – like everyone at Ahead – it understood that saying no was not an option.
We have created that culture of urgency in several ways, including:
Steps like those help light a fire under our employees and keep it lit 24x7. That may be only one factor in nurturing growth, but it’s hard to imagine succeeding without it. Being responsive to customers' needs doesn't have to take all the wind out of employees' sails, as Ahead's Human Resources director noted in his blog last week: Have Fun While You Grow.
- Gov't Customers Demand Tech Solutions Support the Big Picture
- Shared Risk Takes Center Stage In Federal Policy, Channel Sales
- Strategic Partnerships – Diversify or Die
- Software Migration Simplified
- Create a Culture of Urgency
- Myths of Growth: Myth #4, Never Turn Down a Sale
- Have Fun While You Grow
- Four Myths of Growth, Myth 3: The More Vendor Partners, the Merrier
- Spend Money to Make Money
- Focus, Build on Relationships and Stand For Something
- Four Myths of Growth, Myth #2: High Growth Companies Need To Be Controlled From the Top
- Breaking Out of the Reseller Mold
- Four Myths of Growth: Myth 1, All Decisions Must Be Perfect
- Why Aren't You a Fast Growth Company?
- What Fast Growth VARs Can Learn From The Jet Blue Flight Attendant’s Meltdown
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