The Channel's 'Holy Grail'

Service provider, hosting or managed service programs or tracks have been launched. When a vendor also offers a public cloud service, criteria have been set down for your support and investment in white-labeling or selling public cloud services as well. Some vendors selling servers, storage or software to national or international infrastructure as a service provider, have rolled out programs for the big guys. In some cases, savvy vendors make an effort to connect the service provider’s VAR (solution provider) recruitment with their own hardware or software VAR community. This Rubik’s Cube of connection of service provider program to hardware or software vendor program and the respective partners is today’s channel chief’s “holy grail.” In this multidimensional linkage lies the key to a hardware and software vendor providing clear go-to-market direction to you. A potential example might include direction to solution providers when selling a solution on-premise: When selling or leveraging a public cloud solution, white-labeled or resale, use one of our “preferred” service providers. Some vendors then point the direct sales and partners to the preferred service provider community or list.

The concept is well understood. The implementation is oh-so-difficult to achieve. Getting this far would provide you with clarity when selling on-premise to capture the roughly 70 percent to 75 percent of the IT budget spent in the traditional one-time-charge fashion. In addition, when capturing the 25 percent to 30 percent of the IT budget that is now being spent outside the customer data center, typically in a recurring revenue fashion, your primary IT vendors would have provided you a directory of service providers powered by their brands. Watch this space. I expect over the next 12 months, this piece of the puzzle will fall into place nicely, and vendors who have not already done so will make known to you preferred public cloud service providers to complement your investment in their architecture and brand.

The jury is out on the hardware or software vendors’ ability to link their partner programs to the service providers’ programs. The amount of service provider sell-through reporting and reconciliation to hardware or software vendor first, then to the vendor’s partner and finally to credit the partner for annual revenue minimums still looks like a Star Wars Galactic renunion back-office solution. The priority for Galactic back-office support, at a time when some vendors are still trying to secure a clear view of their end customers via distribution sell-through reports, is likely low.

One astute channel chief recently asked, “When do we start to trim some of our legacy program capabilities to make room for the new selling and technology models we are investing in today?” That time is now. Your vendor partners need and want to know what’s “critical” and simply “nice to have” when it comes to vendor support of you. Dollars and staff supporting “nice to have” or underutilized programs, tracks or benefits should be redeployed to the newer program “holy grail” issues that will make a difference to you as you capture your fair share of the IT budget, on-premise or not.

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