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Partners ‘Need A Plan’ To Capture Post-Pandemic IT Spending Opportunities: IDC

‘Basically, 72 percent of the companies you are going to be competing with have reacted and embraced the new normal and are moving their businesses forward,’ IDC’s Group VP Joseph Pucciarelli tells partners during MES Spring 2021.

On the heels of the global COVID-19 pandemic, the market is facing an uncertain outlook in 2021. But that volatility has sparked new customer challenges and has made room for channel partners to have a more prominent seat at their customers’ tables, according to research firm IDC.

“At this point, it’s difficult to predict how the markets are going to shape up, what the demands, challenges, and opportunities our organizations will be facing,” said Joseph Pucciarelli, group vice president for IDC during his keynote at The Channel Company’s Midsize Enterprise Summit (MES) Spring 2021 virtual event.

That’s why it’s imperative for partners to have a plan, even if that plan doesn’t survive first engagement, Pucciarelli said. Solution providers should be looking at the current needs of their customers and mapping out the next three to 18 months, which could prove to be “the most interesting, challenging and exciting opportunities” of a channel executive’s career, he added.

[Related: Cloud And Edge Computing Are Key To 'Next Normal': IDC]

Twenty-eight percent of solution provider businesses are still focused on survival and coping with the pandemic, while 72 percent are already making investments in business resiliency in order to withstand any more volatility coming their way, according to a IDC survey of 109 respondents at MES Spring 2021. Thirty-two percent of channel businesses are making targeted investments to improve their business standing, and 13 percent are transitioning to the new normal, the survey found.

“Basically, 72 percent of the companies you are going to be competing with have reacted and embraced the new normal and are moving their businesses forward,” Pucciarelli warned partners.

Many businesses are also ready to move on from 2020. According to a recent IDC research survey based on more than 600 executives, 35 percent of enterprise respondents say their IT budgets are higher than last years budget. The top three areas that these companies marked as spending priorities are cybersecurity at 72 percent, IT automation at 53 percent, and 52 percent identified customer experience as its area of focus for 2021.

Luis Alvarez, president and CEO of Alvarez Technology Group, a Salinas, Calif., managed service provider, understands well the importance of having a plan. “You just can’t go into it blind. Hope is not a strategy, as we like to say around here,” said Alvarez.

The firm holds a retreat at the end of every year to discuss strategy for the coming year, but the pandemic caused Alvarez and his team to scrap the game plan last year and come up with a new approach, Alvarez said. “We looked at things like what customer pain points can we solve? Are there any new products and services? What does this present in terms of opportunities that weren’t there before this happened?” he said.

Alvarez Technology Group’s customers are already leaving the pandemic in the rear view mirror and “aren’t looking back,” Alvarez said. Instead, clients are focused on digital transformation.

On average, digital strategies and capabilities in 2020 led to a 14 percent bump-up in financial results improvement, IDC’s Pucciarelli said, noting that CIOs are continuing to emerge as business leaders. In fact, CEOs and CIOs are the most frequently-involved in approving digital transformation technology acquisitions -- a departure from CEOs and CFOs being the two most involved executives historically, he added.

“That speaks to how [IT’s] role is expanding,” Pucciarelli said.

With that role expansion comes responsibility. Partners are being invited to sit at the table and engage with business leaders on achieving business outcomes. “It’s a tremendous opportunity and it’s very exciting, Pucciarelli said. ”The question is, what are we going to do with that opportunity?”

Alvarez Technology Group, a trusted advisor to its clients, is being asked more frequently to speak with advisory councils, senior management, and the board of directors, Alvarez said. “You definitely have to be very proactive about meeting with them regularly and communicating very clearly that you want to be part of that that inner circle. Don’t make decisions in a vacuum and then bring us in after the fact -- the outcomes aren’t going to be as good.”

Perhaps most importantly, solution providers must ensure they are keeping IT focused on achieving outcomes that support business requirements, Pucciarelli said.

“How do we out-think our competition and out-think the problems?” he said. “We have this moment to participate in the strategies of our businesses like never before. How are we going to use technology to achieve and align with the required outcomes?”

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