Key words to remember in tough times

Key words to remember in tough times

Local Insight

At just about every meeting, client catch up or industry event I attend these days, people ask me the same basic questions: “How’s business, what’s going to happen next and when/where is it all going to end?”

Well I have news for you: It is never going to end. This is just another, albeit different cycle, which the greater business community – and, of course, the IT channel – will need to chart its way through. I have been in this industry long enough to Remember what doing business was like in the early 1990s and the post-2000 IT spending hangover. While they were difficult times, we adapted and many actually prospered in the conditions.

Prosperous times can hide a multitude of business sins. Good businesses will continue to grow and take market share from those that sit back or continue a “business-as-usual approach”. Those that are not managed well, or are not Reading the signs, will struggle and potentially fail.

Most of the industry has not yet been significantly adversely affected as planned IT budgets and projects for this year are still in the process of being spent. However, there must have been some white knuckles after the wild ride the Australian dollar has taken against the US greenback.

One thing for sure is that uncertainty brings the need to change, and change brings opportunity through a Review of existing processes and a proactive approach to Risk mitigation.

A good example of this was a distributor who explained to us how they had improved their back-of-house processes by investing in OCR and other technologies to further automate reseller quoting and ordering systems. This new system was also tied into treasury processes, not just inventory/SKU listings and logistics. This now allows them to quickly and very cost-effectively provide large numbers of accurate quotes to resellers (with much shorter validity times), thereby not exposing them to potentially massive currency losses by quoting and accepting orders below landed cost.

A byproduct of this review was that Resources that were once Reactive were able to be Redeployed into more proactive customer facing roles. This then allowed them to accurately process a record number of orders in a day from resellers, taking the opportunity to pre-purchase stock before a well known hardware vendor’s announced and inevitable price rise.

Another instance of improvement was through channel Realignment. We were recently asked by a vendor to Research their channel around a specific product that some partners were selling a lot of, but the majority were not. What we found was the product was quite sound but the vendor’s engagement was not meeting Reseller expectations to actively and effectively sell the product to their customers. The underlying problem was that Remuneration did not match the amount of work Required to sell the product.

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