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ARN Roundtable - Distribution is the new facilitator

ARN Roundtable - Distribution is the new facilitator

At an exclusive roundtable in Sydney – a group of thought-leaders assembled by rhipe and ARN – discussed the changing channel landscape and how businesses can start looking for new opportunities and innovative ways to add value and profit.

George De Bono (rhipe), Max McLaren (Red Hat), Walter Rosada (Datacom), Paul Turner (Zynet), George Kazangi (BlueCentral), Carolyn Darke (Microsoft), Tom Mason (Seera), Nick Beaugeard (HubOne), Ben Town (Hosted Network), Warren Nolan (rhipe), Hafizah Osman (ARN), Barry Silic (The Cavalry), Jennifer O'Brien (ARN), Eric Jewett (SkyKick), David Nicol (Citrix). Photo: Mike Gee

George De Bono (rhipe), Max McLaren (Red Hat), Walter Rosada (Datacom), Paul Turner (Zynet), George Kazangi (BlueCentral), Carolyn Darke (Microsoft), Tom Mason (Seera), Nick Beaugeard (HubOne), Ben Town (Hosted Network), Warren Nolan (rhipe), Hafizah Osman (ARN), Barry Silic (The Cavalry), Jennifer O'Brien (ARN), Eric Jewett (SkyKick), David Nicol (Citrix). Photo: Mike Gee

"The fact is that we now have an expectation that we go out and do a whole lot of four-legged selling because relying on our own sales functions or our sales capability isn’t sufficient anymore.

"We are having to retool reskill all of our traditional managed services capabilities. It’s a massive transformation the marketplace is going through - and that indirectly impacts how we partner with our distribution channel."

Paul Turner (Zynet), Ben Town (Hosted Network). Photo: Mike Gee
Paul Turner (Zynet), Ben Town (Hosted Network). Photo: Mike Gee

Paul Turner - Managing director and CEO, Zynet

"We are a business solution provider because we very much focus on the business needs of the customer rather than the technology and trying to align that. In terms of distribution, I don’t see rhipe from a distribution point at all.

"I have always seen rhipe as a partner with open arms, a provider that you can approach and get help from. I’m seeing that more and more now in the industry. I’m seeing the enhanced partnering as creating uniqueness, creating opportunity, allowing partners to make it their own and leveraging the skills of the providers to be able to differentiate in the marketplace.

"We are also an ISV, although our service pillars are solution selling and IT management and moving into information exchange protection, but we’re trying to combine all those things into a Cloud market so we can deliver a much better outcome for the customers.

"The market has changed and it is all about outcomes now. It’s about increasing the customer base, it’s about change and it’s about making sure we can deliver what the customer needs - and we’re using the likes of rhipe to do that."

Eric Jewett (SkyKick). Photo: Mike Gee
Eric Jewett (SkyKick). Photo: Mike Gee

Eric Jewett - Vice-president international, SkyKick

"Within distribution and the channel it is all about business transformation. Within the reseller channel we see partners in different stages in the various parts of the country.

"We see people that are still hanging onto that legacy business as long as they can, versus other partners that have embraced transformation, are giving up their legacy business and moving as much as possible and as fast as possible to Cloud.

"There is a need for partner enablement to move partners into the Cloud, and helping partners with their profitability of how they build an on-going current revenue business model. Partners might lose money initially, but it’s really about the future of business."

David Nicol - Director workspace product sales, Citrix

"We’re clearly seeing the trend of customers transitioning to as-a-service. Our fastest growing business is our service provider business that reflects that.

"Interestingly, the clear majority of that business is small to medium end users that are ready for that transition, compared to large enterprise that’s still often stuck with their on-premises deployments. This means the nature of deals is very different.

"The alternative is not a large transaction for the channel, but rather a lot of smaller transactions. A challenge that presents for the channel in that transformation is the revenue transition. When it comes to business transition for partners, there’s a role both for vendors and distributors to help partners through that journey.

"The other aspect is with end users, who are no longer consuming a project or a specific one-time outcome but an ongoing service. There is more importance on aspects like end user experience and service and support.

"What can distributors do to help partners establish best practice in those areas so they’re not just acquiring a customer but retaining customers and delivering on the revenue stream that should be more profitable for all parties?

Networking pre-roundtable. Photo: Mike Gee
Networking pre-roundtable. Photo: Mike Gee

Time of transition

Partners are tasked with transitioning to evolving business models and dealing with the subscription-based consumption model, according to HubOne CEO and founder, Nick Beaugeard

“There are lots of different very confusing revenue models. Certainly in partner land, just to take a single value [Microsoft licensing models, Citrix licensing], it’s infernally complex and when that drops down to the reseller you have a customer saying, ‘look Mr Reseller I just want to pay a single price per user per month, what does that look like?’ There are not a lot of partners I know that have the wherewithal to really get that right and make it competitive,” he said.

Agreeing there are challenges, Zynet managing director and CEO, Paul Turner, said the industry needs to be flexible and agile in order to collaboratively help customers get a desired outcome.

“You have to be agile now – not only with your customers but also with your other partners and providers. It’s going to be agility across the board. You have to recognise what level of help a customer wants. Customers don’t even know what they want and some of them want to be told or understand or make the decision based on the information you give them.

“I find sometimes you have to balance that because if the customer knows what they want and you don’t listen, they’re not going to be a customer for very long. But if a customer wants your advice because you are the trusted advisor, you need to be able to recognise that so that you can then solidify a solution and be able to deliver that professionally and capably to make sure it has the outcome that they want.”

Microsoft small to medium business channel and distribution manager, Carolyn Darke, said partner profitability needs to be carefully considered at this time of market disruption.

“We want our partners to be profitable in the new world, in the new Cloud world. They’re struggling to find out how they can perform in the current world and transform into the new world.

"We have a checklist of how we can approach all those different skills that are needed, as well as the capabilities that are needed to think about profitability in the new world: including differentiation, unique IP, and marketing skills [marketing-as-a-service] in the new digital world.

"Because you’re looking at customer acquisition, you have to think about investing in marketing, but also the types of marketing they do because customers are looking in different places these days.

Warren Nolan (rhipe), Tom Mason (Seera), Hafizah Osman (ARN), Ben Town (Hosted Network), George De Bono (rhipe), Nick Beaugeard (HubOne). Photo: Mike Gee
Warren Nolan (rhipe), Tom Mason (Seera), Hafizah Osman (ARN), Ben Town (Hosted Network), George De Bono (rhipe), Nick Beaugeard (HubOne). Photo: Mike Gee

Top 5 considerations in the age of disruption

  1. What is the line of responsibility? Who owns the client? How do we allocate blame? Who’s responsible for the delivery of all aspects and the individual elements of the service? - Warren Nolan, rhipe
  2. How do you determine profitability as opposed to billable hours? - Eric Jewett, SkyKick
  3. How does the channel transition from appealing to an IT audience to a business audience? The value propositions today are business value propositions - David Nicol, Citrix
  4. Partners need to understand the customer’s chain of pain (what the CEO/CIO needs), which is often foreign to a partner. It is having meaningful conversations at all different levels (IT, HR, C-level and marketing) - Tom Mason, Seera
  5. The outcome is the issue. That’s what the customer wants. Partners need to rethink the outcome strategy, which is both a challenge and an opportunity - Max McLaren, Red Hat

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