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In a Monday session, Tiffani Bova, a Gartner vice president and channel researcher, predicted that the next 10 years would see cloud adoption as primarily a hybrid model: on-premise and off-premise.
"You need to be thinking about the skill sets you require to be successful in alternative delivery models," Bova said. "This is something that's going to be a significant change in your business. But this is also an area in our public sector system where some agencies are better than others at leveraging the cloud."
Bova named alternative delivery models, a focus on SMB, consolidation of channel companies, the first wave of green IT and the movement of integrators up the value chain as key business trends in the public sector channel. She urged integrators to look to their strengths and come up with new ways to deliver value-added services.
"It can't just be, 'I have this contract, I have this status,'" she said. "If you do something really well, and you've done it 50 times, think about how you can make that something you can package and resell. Think tactically in 2010 about where you should be putting your investments. What's on your Web site. What does my marketing audience see. Is my messaging the way it should be, and does it show I look at public sector trends specifically?"
Bova reiterated Sood's points that government contracts would continue to move from cost-plus to firm-fixed price models, and that procurement vehicles would continue to consolidate.
"That means less available space for prime contractors and more focus on partnering," she explained, but also that there would be increased oversight on contractor pricing and partnerships.
Bova urged integrators not to "boil the ocean" in how they approach government and public sector opportunities.
"You guys are being pulled in a lot of directions -- energy and climate change, tech compliance, civil security, cybersecurity. Each of these has varying layers of complexity. Don't try to do all of these simultaneously," she said. "Pick one, understand how it'll impact business and what types of resources you need and how to market yourself. Get the best. There is a very high unemployment rate, but there's still a drought in technical talent."
What concerned her most, Bova said, is that a "new normal" for the channel is emerging where lower standards are accepted and there's less risk tasking among solution providers. That's thanks to competitive pressures, customer pressures, economic pressures and business pressures.
Remember your audience, Bova urged.
"When do I stop selling a tech conversation and start to have a business conversation," she asked. "Innovation doesn't always mean an expense."
Heading in 2010, she said that Gartner predicts cloud computing will be among the most important growth areas in public sector channel opportunity, followed by advanced analytics, client computing, green IT and the data center. A year ago, Gartner's top areas were virtualization, business intelligence, cloud computing, green IT and unified communications.
Among the "new normal" for solution providers are that virtualization fundamentally changes data centers, provisioning choices have expanded, use of cloud-based applications has increased, device and operating system options matter less to customers, major Microsoft upgrade decisions loom around Windows 7, and non-enterprise owned devices are becoming safer and more desirable.
Developing a services practice, Bova said, is still the fastest way to grow a solution provider practice.
"How do you build a business that's sustainable? Recurring revenue," she explained. "If you entered 2009 with no recurring revenue streams, you had a hard year."
According to a Gartner survey of solution providers, 40 percent of partners leverage vendor cloud services, 51 percent have invested in their own network operations centers (NOC), and 56 percent have developed intellectual property that gives them a competitive advantage.
"Fifty eight percent of those surveyed are still willing to resell hardware with no services attached. That's surprising to me," Bova said. "To get into the habit of selling products with no value services? I didn't think it was going to be that high, let me put it to you that way."
Bova urged VARs to prepare to become more consultative then ever, develop the right skill sets that focus on domain expertise, and do away altogether with one-size-fits-all approaches.
"Don't give it away for free," Bova said. "Figure out how you can monetize the consulting aspect of your business. How you can monetize the compliance aspect of your business. Look at all those hot buttons."
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