Skate Toward The Puck

Historically, trends in this industry need many more years to play out than predicted. That’s not the case with the current move toward cloud services.

I just came back from the Best of Breed conference (BoB) where we spent two days talking about building a channel business model to match the market. Wayne Gretsky, considered to be the best all-time goal scorer in hockey was once asked why he was so successful. He answered by telling the interviewer his strategy is to skate to where the puck is going to be, not where it is.

I’m convinced solution providers need to do the same. You need to assess your business model now and ask yourself if your customers are going to buy the way they do today in a year or two. You need to realize that customer buying behaviors are changing and you need to match your product and service portfolio to that spend. You need to skate to where the spending is going to be, not where it is today.

Here’s the danger as I see it. No customer is going to proactively tell you that they are less likely to do business with you in the future because they see themselves going in a different direction. Customers that don’t believe you can fit with their future needs will simply look elsewhere unbeknownst to you. Months after they have made that decision, you will figure it out by realizing your business with that customer is down.

Fact is, the traditional buying process inside corporations is changing. The CIO is no longer the sole decision maker. In some cases the CIO is not involved, especially when it comes to off-premises public cloud purchases. Oftentimes, these decisions are being made by line-of-business managers who are buying a service that gives them a competitive advantage in the market. Those services are being paid for with operating budget money and are not being capitalized as has been the case in the past. As such, the approval process inside of the organization is completely different.

The solution provider attendees at BoB are mostly the largest and most elite partners in the market. These players will make the transition. I’m concerned about the larger channel community. I talk to far too many partners that tell me business is good, and at some point they need to figure out what to do about the new model.

I can name a dozen partners off the top of my head that are growing at phenomenal rates because they have built a sales and delivery model for the future. One partner I talked to at BoB told me their company grew 65 percent last quarter. Mind you, this is a $60 million company. You don’t grow that fast unless you have a model that is built for the future.

My personal feeling is that if you are not building a futuristic model that is designed to deliver services rather than products, you are at huge risk. Your model of the future is to sell services and not even quote products separately. Some of the smartest partners I know are keeping the product makeup of the proposed service/solution completely off the quote because they don’t want to get into a discussion around pricing of piece parts. Let’s face it, products that go into a solution are less important when selling a service.

For those of you that missed the event, take a look at the discussions at BoB by going to bobconference.com.

Most importantly, it’s time to begin thinking deeply about it now or you are going to find yourself skating to where the puck is one of these days only to find out it has been passed so far ahead of you there is no way to get there.

BACKTALK: Make something happen. Robert Faletra is CEO of UBM Channel. You can contact him via e-mail at robert.faletra@ubm.com.

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