SCS' Services Bet

Carrick is the president and CEO of SCS, a Syracuse, N.Y.-based solution provider that saw its sales nearly double in 2002 to $51.3 million. And the company is looking at sales growth of 25 percent or more this year. What's interesting about SCS, which sells only IBM products and solutions, is that the company's rapid growth has come during the biggest IT spending slump in history.

Carrick, a former IBM executive who took over SCS three years ago and now owns the company, has taken the same road the vendor itself has taken to higher profits and sales. Instead of fighting the shift in the IT landscape, Carrick moved SCS's business lock, stock and barrel to the higher ground of software and services.

Carrick says the secret to SCS's success has nothing to do with him and everything to do with what he calls "the best people in the industry and an outstanding relationship with our partner IBM." Clearly, SCS's technical talent and single-vendor business model has been a big plus. Carrick has been able to develop a tight relationship with IBM and IBM Global Services that allows his company to do joint account planning that would not be accomplished as openly if SCS also represented other vendors' product lines. As for technical talent, SCS has more than 120 certifications, yet it has only 72 employees. "Anybody who faces a customer or who sells services has at least one certification," he says.

Carrick says the single-vendor model has not been a handicap for SCS. Rather, the demand for solutions is so powerful that customers simply want "someone they can count on and trust, and the stuff has to work," he says.

There is no one silver-bullet formula in the channel. What works for one solution provider, such as a single-vendor business model, often can be pure poison for another. The key is to put a stake in the ground and make some bets. And those bets must include services and software. What's more, they should include some vertical-market capabilities. Now, those solution providers that don't make these bets will still find a number of business models that work,that's the nature of the channel. But those other bets are long shots. Services, software and vertical markets are the favorites.