New Day, New Dawn: Helping Partners Deliver On The Hybrid Cloud Model

The cloud is proving itself a transformative technology for both the businesses that are using it to store data and run critical workloads, and for the solution providers that enable them to do so.

For end users, capex becomes opex, computing resources become highly scalable, and employees gain greater access to company resources, for better or worse, from mobile devices and remote locations.

For solution providers, selling the cloud brings recurring revenue, fewer site visits, and often a closer relationship with customers and vendors.

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It's an intriguing partner model, but one that substantially strays from the previous mainstay of the industry.

Leading cloud vendors are helping their partners take the leap by providing them with technologies that not only empower them to migrate and manage their customers' workloads, but also to maintain traditional on-premise infrastructure by building hybrid environments.

Prior to the recent news rocking the industry involving Hewlett-Packard's planned split into two companies, Symantec's decision to separate into security and storage businesses and other potential moves analyzed by CRN, editors sat down with top channel chiefs from Cisco Systems, Dell, HP, IBM and Rackspace at The Channel Company's XChange conference in San Antonio. Topics ranged from the new cloud business model to much more.

"I don't think there's a customer out there of any significance that doesn't have a strategy for this, and every single partner is going to have to deal with it. This is going to happen quickly and continuously and there's no reason for it not to," said HP's Stephen DiFranco, vice president, general manager, Solution Partners Organization, about the hybrid cloud model rapidly transforming the market.

"There are parts of every infrastructure or every application load that can make sense if it was in a cloud environment. So I think it's going to happen very fast. I think it's happening," he said.

The greatest challenge for vendors such as HP is going to be "making sure we do a great job of being the kind of company they need us to be. That we not just have our programs and our dollars, but also really be able to support them as they develop their businesses and their practices," DiFranco said of the company's partners.

Bruce Klein, senior vice president of Cisco's Worldwide Partner Organization, added, "It is happening and it's a compelling business model and everybody is trying -- the end-user customer is trying to do two things, right? They're trying to grow their business and differentiate their services, and they're trying to cut costs. And this technology, this model, helps them do that."

One way that Cisco is aiding partners in selling their cloud services is by introducing new APIs that give software developers access to robust and versatile development environments, Klein said.

Those APIs allow startups building applications to use "services that they've never had access to before," Klein said.

Tami Duncan, vice president of North American channels at IBM, said IBM also is trying to win over software developers with its cloud offerings.

"We're really aggressive on new development partners right now because we feel that would drive that workload in the future. So that development space is big for us," Duncan said.

While solution providers, CIOs and other C-level executives are weighing the costs and benefits of migrating workloads to the cloud, the truth is cloud applications have already infiltrated just about every business unit within the enterprise through the back door of so-called shadow IT, said Will Knight, vice president of channel partner sales at Rackspace.

From discussions with Rackspace's channel partners, Knight has come to believe CIOs are underestimating cloud adoption within their companies by a factor of 10, "just because they don't know what's going on."

One solution provider told him that just about all its new customers are already running some cloud applications such as Google Apps, Microsoft Office 365 or Salesforce.com, Knight said.

"They're all dabbling in it," Knight said, even if "they may not know how much and how fast it's progressing.

"But everyone's running some on-premise as well so we've got this big hybrid environment going on. It's not always most cost-effective to run it in the cloud," Knight said.

Next: It's Time For Partners To Adapt

The abundance of cloud-based apps infiltrating the enterprise through shadow IT, software developers wanting access to ever-more-powerful APIs, and the evolving relationship between solution providers and their customers are all creating a complex new IT landscape that partners must continually adapt their skills to.

For that reason, Dell will never reach its fill of partners, said Frank Vitagliano, vice president of channel sales.

"We're always looking for new partners to work with whether they're existing partners that are disgruntled with somebody else or whether they're creating a new practice," Vitagliano said.

All the vendors represented at the table instinctively quote large numbers when talking about their global partner networks, he said. But "at the end of the day what matters is do we have the right level of skills and capacity to get our solutions into the marketplace?"

"The skills are continuing to get more and more complex and you need different sets to keep up but, at the same time, you also have folks dropping out, not anything near like what it used to be," Vitagliano said.

Cisco's Klein said solution providers that want to succeed should be thinking about creating "a new level of relationship with an IT department" and also being the "orchestrator" of providing their customers choice in the solutions they seek, be they public clouds or in-house private ones.

"There's an ability to do that with the clouds that are being developed today," Klein said.

For Rackspace, the ideal partners are "geeks with great bedside manners" who can help businesses in their vicinity tackle complex IT problems, Knight said.

"Those are the ones that help solve problems, but they do it in a way that makes the customer successful. ... So having someone that can, some geeks that can support that infrastructure but also locally having those geeks that can engage and help them solve their local problems, you can't underestimate that. That's why I’m a strong believer in that local partner because they do the last mile and, ask the cable companies, that last mile is kind of important," Knight said.

Duncan said IBM partners need to do more than choose products for their customers.

"Where I get worried about my partners is if they're not transforming to higher value, if they're just picking up other hardware lines, to me that's not a great long-term strategy. If they're transforming and that fits into their transformation strategy I feel a lot better about their ability and their future and my ability to invest in them," she said.

Vitagliano added he typically sees two situations that cause partner businesses to struggle.

"One has been when they try to expand too quickly or at the wrong time and they get caught in an environment where they just can't capitalize the business," he said.

The second involves a business model that tries to do too much.

"Partners that stray too far from their core competencies in what they really know and are really good at really struggle, really struggle, and the vast majority of the time they underestimate how hard that transition's going to be," he said.

"We all want our partners to be profitable. We all want them to grow and, in this new world, we can't supply everything. We want them to make sure they surround themselves with complementary products, not competitive products," Klein said.

Partners are going to be increasingly delivering to their customers more converged infrastructure stacks composed of products from multiple vendors, he said.

"That's going to happen and we think that should happen, but we want to make sure it's complementary, not competitive, to be honest," Klein said.

This article originally appeared as an exclusive on the CRN Tech News App for iOS and Windows 8.