Channel Stalwart Ken Archer On His Exec Role At Nectar, The Red Hot UC Market And Making The Most Of Microsoft, Cisco Relationships

New Nectar executive Ken Archer spoke with CRN about recruiting partners to the network monitoring and performance management firm and how he'll attack the booming unified communications market.

Channel Bullseye

He's only been on the job a few days, but Ken Archer is already planning a partner recruitment blitz and the addition of partner enablement resources at Nectar Services Corp.

The network monitoring and performance management firm announced today that Archer, a channel veteran who has held high-level positions at industry giants like Hewlett-Packard Enterprise and Avaya, has been named Chief Revenue Officer at the Jericho, N.Y., firm.

In his new position, Archer will oversee all routes to market for Nectar, including all global channels, making him the company's de-facto channel chief.

Archer's relationship with Nectar runs deep. When he was at Avaya between 2005 and 2007, he nurtured a relationship with Nectar based on a deeply held belief that its technology and its ability to enhance channel partners' value proposition among clients undergoing fundamental changes in the way they operate their businesses. Those early days led to Nectar's deep relationships with both Microsoft and Cisco and an enviable position in the red-hot unified communications market.

As chief revenue officer, Archer, who spent the better part of the last decade at HPE, is in a position to accelerate Nectar's vision through a rock-solid commitment to its partners through increased enablement resources and a new program structure based on which regions partners work in.

What follows is an edited excerpt of CRN's conversation with Archer.

What made Nectar attractive to you?

I've known this company for 12 years. When I was channel chief at Avaya, and they were building a software platform, I was the executive sponsor for them at Avaya because I believed that in the Avaya ecosystem there needed to be a platform that monitored the Avaya platform and everything connected to it. Avaya didn't have any diagnostic tools or capabilities to monitor anything outside the pure Avaya environment. I was a big fan of the technology platform and tried to get Avaya to license it. They did not, and ultimately, I helped them to build their business plan and go-to-market strategy to have their platform inside a lot of Avaya partners' managed service offers. It enhanced the partners' value proposition out to customers who really needed to manage and monitor the Avaya platform and everything connected to it.

What's the revenue potential for partners with Nectar?

The revenue margin is better with Nectar than with any alternative out there. We built it for the channel. That is our route to market. We do have a subscription servers, a monthly recurring revenue type of model, and that model is very attractive to partners. Most partners do have an exit strategy, and the more monthly recurring revenue they have or maintenance revenue, the multiple on those types of businesses is four or five times what it is for a pure hardware reseller where you're going to get 1X revenue. The attractiveness at the front end for sales reps and owners is significant. The margins are high. Down the road, as owners look to exit the business or get maximum value for the companies, having that monthly recurring revenue and maintenance revenue is significant.

Have partners embraced the recurring revenue model?

We've got significant partnerships, and most of the partnerships we have are all in a monthly recurring revenue model or subscription service model. That's been a pleasant surprise, because where I just left, Hewlett-Packard Enterprise, they're going to try to enable a channel that is not used to selling in that type of environment so there's a very steep learning curve to enabling that channel, teaching them how to position and sell subscription services whereas this channel that I now run is already there.

Why should partners place their bets with Nectar rather than a competitor?

Because of the uniqueness of the technology. There is a vendor knowledge module they can build for anything they have and can manage and monitor it today. The product is only going to get better and more capable. As voice and video and unified communications overall start to become the responsibility of IT personnel, there is no better platform out there that can manage and monitor the unified communication platform today. With the development plans, marquee customers and partners we already have, it is only going to get better. In a head-to-head competition, Nectar never loses.

What's your outlook for partner recruitment and development in your first year?

I think there's potential to add a lot of new types of partners to our partner community. One of the areas I'll be investing in quickly is to build out a channel enablement function that can help optimize current partner relationships as well as help us with new partner onboarding so we can collapse that time to revenue. It's good for them and good for us. I ran worldwide sales and partner enablement at Hewlett-Packard Enterprise, and I learned a methodology to build a training curriculum, but also the tools and capabilities to allow for partners to find it easier to sell and get the necessary assets to support those efforts.

What changes in customer behavior and habits do partners have to navigate when it comes to selling a platform like Nectar's?

Customers want to buy based on business outcomes. They don't want to buy anymore on features and benefits. In order to change your sales methodology for both direct sales and for your partners, you have to have proof points. You can talk about all the things you can do to improve outcomes, whether it's increasing revenue, increasing customers, improve customer satisfaction. Ultimately, the customer will want to know where have you done this before with a customer like us, and ideally, in the industry we're in. Therefore, you have to have sales assets that come in the form of customer presentations that are customizable; references; use cases; whitepapers. There are a number of different things you can make available to your partner sales force so they can feel comfortable, be on their toes and say we can help you transform. We can help you with the business outcome goals you have because we have done it before.

How did Nectar's relationships with Microsoft and Cisco develop?

Since my Avaya days, I have been on [Nectar's] board of directors. They created a board of advisors, which I became part of and stayed connected to the company and helped guide them as they evolved the platform to support Microsoft Skype for Business and the Cisco environment. They have very, very strategic relationships now with Microsoft and Cisco, and they're on Cisco's global price list. Cisco sales reps and partners can get paid off the marketing and selling of the Nectar platform. It's exciting because my last eight years have been focused on enabling partners to evolve to build their services capabilities and services offers so they can add more value to customers and look at their margin-making profile. As hardware resale margins have been shrinking over the last few years, more and more of those hardware-focused partners needed to evolve to a services focus.

How has Nectar's position in the unified communications market changed?

I see this as a continuing evolution of a platform that really helps partners build out managed services capabilities, or to enhance their managed services capability. Everybody wants to enhance the user experience Microsoft Skype for Business, or a Cisco voice and video environment. Unified communications is really a hot market opportunity, and we have the premier platform to manage and monitor anything in the unified communication environment.

Does Nectar's platform get hotter as Unified Communications as-a-Service takes hold?

Yes. Absolutely. Their capability, which is unique, is the auto-discovery of what is out on the network, everything from the internet providers to the actual device. They know what's connected and when there is a problem, whether it is voice communication, video communication. They can determine what the root cause is. A lot of management platforms will identify that there's a problem, but they won't be able to diagnose what the problem is, whether somebody has changed a router device, or changed a configuration, or they've taken it offline. It's quite comprehensive and detailed.

What makes something like a monitoring platform an attractive prospect for partners?

It goes back to what's going on at end-user customers with the whole digital transformation. End users are trying to either be disruptive or not get disrupted, and there's a heavy, heavy investment in IT departments to figure out what the killer apps are, how to communicate better with their customers and improve customer experience. This whole digital transformation is driving partners to really help customers with this evolution. If you have a managing and monitoring platform that really aids a customer through a partner's managed services, that’s why it's a hot opportunity. Microsoft is gaining a lot of attention still at the end-user level with Skype for Business and Teams. Microsoft is a key market maker for unified communications and collaboration.

Between Microsoft and Cisco, Nectar must have the potential to command a huge portion of the UC market.

The Cisco relationship was the result of our strong relationship with Microsoft, and Microsoft saying look, every Microsoft Skype for Business customer is likely to have Cisco at the back end. We need your platform not just to be the premier platform for Skype for Business, but also to manage and monitor the Cisco back-end network so that if there's a problem that people think is Skype for Business, you can identify that maybe it's not. It's a nice ecosystem play. With Microsoft and Cisco, we pretty much have the lion's share of the end-user environments either where they are today, or where they're evolving.

Where does that leave the Avaya relationship?

We have the ability to support Avaya. There's still a lot of legacy Avaya. Some Avaya customers are evolving to Skype for Business, or Cisco. Having a tool that can managed the transition from the Avaya environment to the Microsoft Skype for Business or to Cisco or both, there's a powerful value proposition. Where we're really going to be the strongest is in hybrid environments, where end-user customers really need to support Microsoft, Cisco and maybe Avaya and everything connected to them. That's our strength. The roots came out of the Avaya ecosystem, but there's a ton of transition going on from that legacy environment and that's what makes us attractive to a lot of very, very large corporations.

What makes Nectar a good vendor for partners to work with, and how can you build on that?

Partner sales reps find it easy to do business with us. We can make it easier for them as they evolve and transform their salesforces and they can be more confident in front of customers with this business outcome selling methodology. To do that, it's largely dependent on the enablement function, and that's a key investment area we're going to put in the first 30 days.

Are you eyeing any other changes to the Nectar program?

We're going to put in a national partner program. We're going to recognize the large, strategic relationships we have regionally, nationally and globally. We're doing business on a global basis and more of our larger partners are doing deployments that are outside the U.S. and into Europe. We need to have a model where we manage and support that type of selling effort. We have a coverage model, program and support structure to support that type of global selling. We're also going to recognize that we need to have a regional coverage model as well. In some cases the partner is just operating in the northeast, or the southeast or Midwest. We have to try to make sure we're putting the right coverage model together. There will be a partner coverage model enhancement recognizing the type of focus the partner has.

It sounds like there might be some hiring in your future.

Yes, definitely. In the business plan, we have quite a bit of hiring. It's recognition of what works and where you need to make investments.

You also have experience running a channel partner business. What insight does that give you into running a vendor's channel operation?

In between Avaya and Hewlett-Packard Enterprise, I was CEO of TriNet Systems, so I got to run a managed services partner myself. I got to walk in the shoes of a CEO of a partner who is running managed services and had utilization rate monitors so that I didn't have people sitting on the bench. I had to work on making sure we were optimized. It gives me credibility when I talk to someone who's building a managed services business. I've been there and done it, and I can help them with best practices.

What are you telling those folks? What do you need from them?

Commitment. I'll invest for those that are committed. It comes down to high touch versus low touch. If they're committed, we're committed. I'll put in coverage resources. I'll put in technical resources, enablement resources. If they commit, we'll commit back. This is always a joint investment strategy that you go through with partners. We realize they have a choice of which vendors to work with and the largest partners have as many as 500 or more vendors they're representing. I will earn their loyalty, their trust every day. That is an investment I will make based on their loyalty and commitment.