As more end user customers consider a move to cloud computing, reseller partners are having to gear themselves up to be trusted advisors and competent cloud service providers.
But moving from a traditional transactional partnering model to an annuity-based cloud model can be daunting – and resellers need to ensure they make the transition successfully.
“Cloud consulting and digital transformation are the current buzzwords in the ICT boxing ring of value-added services,” explains Chris Richardson, GM of the Cloud and Hosting division at First Distribution. “But what does it actually mean for you as a partner when your end customer wants to go down the cloud path? And is there a right or a wrong way for you to transition your business to make sure you can meet your customer’s needs?”
The reality on the ground is that the accepted order of business is being turned upside down. “We are seeing cases where big VARs (value-added resellers) find themselves competing with small companies – and are losing deals because they are not agile enough to meet the customer’s requirement.
“And, very often, they don’t even go after the deal at all. If they haven’t changed the incentive structure they offer sales staff, they won’t be motivated to pursue those deals. Also, bear in mind that most cloud deals start off at less than $1 000, so the big VARs leave them alone because they fail to see the long-term potential.
“For these, and other reasons, the partner’s ability to be agile in the cloud market is fundamentally important.”
Partners have to get away from the idea that the initial deal is the whole deal, Richardson adds. “Tying services to a project is where the real money is made – customers are very happy to pay for added value.
“But we see a lot of partners still rely on reselling hyperscaler services without adding any value on top. This becomes a race to the bottom, and partners will quickly find they can’t add margin to these vanilla services or they will lose customers to companies that can add value.”
The simple fact of the matter is that the market environment is changing, and both customers and partners realise they have to change – or lose out.
But it needs to be the right change, so it’s dependent on the company’s specific requirements. “End user customers need to figure out if they want to create more efficiency on their business, or move away from a capex (capital expenditure) towards an opex (operating expenditure) model,” Richardson advises.
“For partners, the questions is whether they want more customers or whether they want to sell more products or services to existing customers.”
The bottom line is that customers need to talk to a partner they can trust to guide them to the right solution.
But choosing the right consulting partner can be something of a challenge: who, where and how does one choose?
“I can offer a couple of titbits of advice,” says Richardson. “The first thing: if you are moving to public cloud or moving business critical workloads, make sure the partner you are choosing is certified to do so. So check the vendor website or ask for a whitepaper the partner has done – and check that it is specific to what you are wanting to achieve. This will give you the confidence to make the right choice.
“The right consultant will always specify a solution that is possible and advise you about what is not,” he says. “Don’t simply follow a trend, but do what is right for your business. The correct consultant will help you to do this.
“Also, bear in mind there might be a need to involve a couple of consultants because they specialise in different areas such as security or migration.”
First Distribution and Cloud Catalyst
First Distribution transacts with partners that deliver value to their customers in a number of ways. “Our job is always to evangelise solutions, provide services, and be the distributor that really puts the value back into VAD (value-added distribution),” Richardson says.
First Distribution built the Cloud Catalyst programme to help its partners on their cloud journey. “We show them how to engage at an end user level in a consultative manner – you could call this the mechanics behind delivering a cloud business,” Richardson says.
“In the Cloud Catalyst programme we take partners from being a traditional ICT reseller, catering for supply and demand, to a consultant of IT services in a consumption model.”
The Cloud Catalyst services offering spans from helping partners to align internal processes and budgets to ensure they are ready to go to market with their cloud brand, all the way to helping them build out a solution to create custom solutions. An example would be helping a partner to create their own Home Office in a box using cloud services.
First Distribution has also developed a partner-to-partner ecosystem called Go First services for this exact reason. “No partner can be everything to everyone, so First Distribution brings partners together to collaborate on projects and to put their separate areas of expertise together in order to deliver the best outcome for the end user,” Richardson explains.
The proof of the pudding
Cloud Catalyst is a mature programme that has guided a number of reseller partners to cloud success.
“We have helped companies to transform their mindsets and realise where they need to change their businesses to seize the cloud opportunity,” Richardson says.
“We have helped them to become more flexible and more agile in the way they adopt budgets, incentivise staff, and conduct training.
“Cloud Catalyst has helped these partners to go beyond the traditional stock-and-sell methodology that limits them in their ability to diversify their service offerings,” he says. “Once they adopt the cloud methodology and put the correct structures in place, they are able to pivot and gain the ability to not only cloud computing, but next-generation, edge computing, and artificial intelligence services.
“They have seen the benefits and are winning new business.”
The cloud is not something new, Richardson explains. “Cloud has been delivered in many shapes and sizes for some time now.
“As more customers move to the cloud, more partners have to develop the resources to assist them. The beautiful thing about IT and services providers that use cloud capabilities is that they can roll out a solution in the blink of an eye compared to the time and effort that a physical implementation takes.
“The good news is that, as the leading ICT distributor for cloud, First Distribution is working with partners to make the delivery of technology over the Internet in a pay-as-you-go model a reality.”
For more information, visit https://www.firstdistribution.com/cloud/