The cloud is about to seriously test the
loyalty of IT vendors’ channel partners. In a cloud-centric world, brand has
far less cachet than the sum of the aggregate parts that make up a solution
provider’s cloud offerings.
So, vendors beware. If your technology falls
short, your communication is poor or your channel program is more trouble than
it’s worth, your partners will drop you. And as solution providers get more
entrenched in the cloud, they will have less patience for relationships that
don’t deliver.
Evidence gathered in a recent study by the
Computing Technology Industry Association bears out these dangers. CompTIA
found in its “State of IT Channel Programs” study that solution providers are
in no mood to hang on to bad, or costly, partnerships and they are happy to
keep switching partners to find the right ones.
While in the past two years 80 percent of the
solution providers participating in the study added one to nine vendor
partnerships, 61 percent said they dropped as many as nine vendors.
Over the next 12 months, this fluid situation
appears likely to persist. CompTIA found that 40 percent of channel companies
with $20 million or more in revenue are planning to add new vendors.
CompTIA also found that smaller and younger
channel companies are more likely to change vendors. This finding adds weight
to the conclusion the cloud is starting to have an impact on vendor/partner
relationships. These younger solution providers in many cases are leading the
way to the cloud. Their business models are more flexible and adaptable than
those of more established channel companies, which means they have far less
baggage to prevent them from embracing cloud-based models.
Chief among the
priorities that determine whether a partner keeps or drops a vendor is the
quality of the vendor’s technology and services. Almost 60 percent of
participants in the CompTIA survey cited product superiority as a major factor
in their vendor partner selections. This makes eminent sense because partners
don’t want to be mucking around with technology that doesn’t work, frustrating
their customers and jeopardizing their own profitability.
Just about as important as technology quality
is the vendor’s interaction with partners. Fifty-three percent of study
participants cited ease of doing business as a major factor in partnering
decisions. This should surprise no one. A vendor with overly complicated
channel program rules and poor communication is hardly worth doing business
with, even if the technology is top-notch.
Partners by and large are running lean
operations, and they have no resources to waste on figuring out how to reach
the right contact within the vendor’s organization for technical, sales or
marketing support. Or, in some cases, how to get paid. Wasted resources amount
to extra costs, which solution providers cannot afford. When vendor
partnerships incur too many unnecessary costs, partners tend to drop out.
So the pressure is on. Vendors in the process
of retooling their partner programs to accommodate the shift to cloud computing
must take into account their partners’ needs and requirements as they do so.
Missteps are bound to prove costly.
Vendors should learn from the lessons of
managed services. Not long ago, solution providers were known to change vendor
partners multiple times until settling on a managed services platform that
worked for them. Partners would get frustrated when they discovered the
platforms didn’t quite work as promised, so they switched at the first chance.
History could repeat itself unless vendors
make sure their technology is truly ready for consumption as they introduce
cloud offerings. They also must make the necessary structural changes to refine
their partner programs, put the affordable training resources in place, and
communicate clearly and honestly with partners.
If they get these things right, vendors stand
to benefit handsomely from the shift to the cloud.
Pedro Pereira is a columnist for
Channel Insider and a freelance writer. He can be reached at
pedrocolumn@gmail.com.
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