Stimulus Reality Check

It's hard to have a conversation about opportunities for growth in the channel without discussing the federal stimulus package. VARs are nearly to the point where they're tired of talking about it, even before any funds from the American Recovery and Reinvestment Act (ARRA) actually start to flow their way.

It certainly was top of mind at this month's XChange Government Integrator conference, where about 300 public-sector consultants and integrators gathered to hear the latest trends and find the hottest technologies for the government, education and health-care markets.

One of the key observations, and perhaps one of the most unsettling, came from Andrew Bartels, vice president and principal analyst at Forrester Research, who delivered a reality check to conference attendees. While it's fun to imagine all the big sales the channel will reap from the $787 billion spending package, a very small portion will, in the end, be up for grabs to fund IT projects. By Forrester's calculations, roughly $28 billion will be available for IT spending over the next two years, which translates to less than 4 percent of the overall package.

"It's not peanuts, but it's not the big piece of gold you might think it is," Bartels said.

Which might explain why so many integrators said stimulus-fueled sales have yet to materialize.

Nevertheless, I believe there is still strong opportunity for channel partners to find and close deals that are funded through ARRA. The proof comes from the public-sector CIOs who participated in a panel discussion at the event.

They offered several key pieces of advice. One is to do the research. Figure out what projects are eligible for funding, find the available grants, gather the requirements and take that complete package to your customer. Then offer to help them write the grant applications. If you are the trusted adviser bringing them all the information they need to get funding, they absolutely will spend that money with you. That was the case in Michigan, where one VAR approached the state's top technology office with a grant opportunity and ended up selling a $2.8 million project.

The other piece of advice is to know your customer. Dr. Melodie Mayberry-Stewart, CIO for the State of New York, said VARs need to come into the first meeting with a solid idea of what their potential customer needs. The worst thing a VAR can do in a sales meeting is ask, "How can we help you?" she said. Don't ask how you can help; come in knowing.

The bottom line when it comes to benefiting from stimulus funding is that it's not going to fall into your lap. The integrators that get out and do the legwork, learn their customers' needs and develop a solid plan for meeting them are the ones that will succeed. When you think about it, that's true in most cases, stimulus or no.