As trends like mobility and the cloud continue to change IT customers' buying habits -- along with the face of those customers themselves -- solution providers must not only recognize these shifts but also adapt their businesses accordingly to be successful over the long haul.
That was the message from David Carlquist, vice president of worldwide channels, IBM Systems and Technology Group, during his keynote address Tuesday at the Best of Breed conference, hosted this week in Tampa, Fla. by CRN publisher The Channel Company.
"Clients are looking for higher value," Carlquist said. "This is reflective of the era we are in and how technology can support it."
According to Carlquist, organizations are turning to technology more than ever -- and especially the cloud, mobility and big data analytics -- to grow their businesses and maintain a competitive edge. In fact, he said, a recent IBM global study found that more than 90 percent of CEOs consider the cloud "critical" to their overall business.
For solution providers, the rise of mobility, the cloud and the new generation of business analytics being spawned by the "big data" trend demand changes in their day-to-day business and sales models. For starters, Carlquist said, this new era of computing is driving more of the IT decision making out of the hands of traditional IT teams and into the hands of the C-suite.
In other words, Carlquist said, the days of solution providers selling exclusively to the CIO or IT director are over. Instead, solution providers should be engaging with other members of the C-suite, namely the CMO and CFO. And, to do so successfully, they need to train their sales force to sell business outcomes and applications just as well as they do technical speeds and feeds.
"One key thing to keep in mind is: Are your sellers and is your field force recognizing this dynamic of a new era and change?" Carlquist asked solution providers. "And, two, are they suitably equipped to be able to engage with these different constituents of buyers? Do they have the right skills? Can they ask the right questions?"
Alan "Skip" Gould, president and CEO of BrightPlanIT, a Buffalo, New York-based solution provider, said he is "absolutely" seeing a shift in customer spend and decision-making from IT to the C-suite. He said this shift has been particularly apparent when selling big data and business analytics solutions.
"It's the CMO spend that is driving most of the IT business that we do anymore," Gould said. "Instead of only targeting IT, we now actually target marketing."
In addition to adapting their sales strategies to target the C-suite, Carlquist urged solution providers to continue investing in managed and cloud services to build up a recurring revenue base and to rely less on traditional hardware sales.
Carlquist said IBM's global study revealed a "tidal wave shift" to services-based IT, with 40 percent of enterprises saying they plan to spend more than one-third of their IT budgets on managed and cloud services in 2013.
"It's an essential part of many channel partner strategies moving forward," Carlquist said.
Gould, for his part, said managed services was the fastest-growing part of his business in 2013, and it's expected to remain that way next year. "We continue to focus there and on the recurring revenue model," Gould told CRN.
PUBLISHED OCT. 15, 2013