The channel doctor is in

The channel doctor is in

If you can't beat 'em, open a channel consultancy. It's an area of the channel where few have ventured, but according to the elite few in operation, the rewards are extremely plentiful.

One such consultant is Braham Shnider, who last week officially announced his move into a new consulting and marketing operation, Channel Enablers, designed to improve vendor and distributor relationships.

Shnider believes his experience from a background at distributors ITG and Ingram Micro, reseller HiSoft, and his own (now defunct) online channel marketplace e-exchange provides a solid foundation to enter the consulting market.

This experience is mixed with a strategic alliance Channel Enablers has formed with the US-based channel consultants Technology Channels Group and Performance Directed Management which runs Melbourne-based management training and consulting.

The company offers a range of services from executive recruitment searching to channel program review and implementation, and has already been in operation since October 2000 with a number of clients.

"We see a huge opportunity for vendors to utilise the channel," he said. "It's about aligning the vendors' expectations of channels with the channel's expectations of vendors."

But while Shnider might claim he's the first channel-exclusive consultancy, he's certainly not the first.

Another man recently in the spotlight is former Microsoft channel executive Geoff Wright, who is on assignment as a consultant at Ingram Micro helping new MD Steve Rust rebuild the business.

Wright is a principal at consultancy Emerald Logic, which specialises in IT channels via its channel arm "Digital". The six-year-old company differs from the likes of Channel Enablers in that it also provides business consulting to a variety of industries.

"A lot of organisations require direction," Wright explains. And that's exactly the point. Vendors, distributors and resellers alike are searching for business solutions to many a channel headache.

Wright points to consolidation in vendor ranks, difficulties faced by niche distributors and falling margins as at least three factors generating massive demand for external channel consulting services.

When asked about the size of the market, Wright replied: "I don't know, but what I do know is it's a turn-away business at the moment."

Jay Johnson, managing director of another established IT consulting firm, Pelorus International, took a big stab, calling it a "multibillion-dollar business" worldwide.

With very healthy fees and repeat business on offer, it reflects the fact vendors need to spend money understanding the channel and their own channel structures in order to gain competitive advantage and drive sales, he added. "Technology is not the issue in the channel anymore."

Johnson and 12 colleagues at the 10-year-old business provide services to predominantly vendor clients, advising executives on channel structures. "We help them understand how they can work their channel to produce better results," he said. "They need the objective views: is that model right? Is that a strategic fit?"

And he says one of the important roles played by channel consultants is evaluating the financial and strategic value of a vendor's reseller partners.

"Many senior managers in the business of IT are realising that taking people out to lunch and building a relationship is only part of the picture," he said.

Shnider also sees an opportunity in helping US vendors enter or develop their presence in the Australian market.

"I can give them the background and help them market themselves to the channel. There are vendors out here that need to improve returns on their channel investments."

David Hancock, managing director of channel research organisation Inform, felt consulting services for the channel were a complement to the research his company undertakes. "There is probably a big opportunity there," he said, adding it reflected a maturing of the market and a manifestation of the important role channels play in the industry.

"This is all good for the channel," Hancock said. "The IT distribution channel is a totally different ball game to the rest of the industry or other industries. Through our research, [channel companies] have told us over the years that effective partnering with suppliers is very important to them.

"So, the availability and popularity of consulting services designed specifically at facilitating such partnership development has to be a positive for the channel."

Photograph: Channel Enablers' Braham Shnider.

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