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When looking around the corner at 2015 channel trends, industry watchers are tossing around words like specialization, maturity and sophistication. In other words, the business transformation train has left the station and smart channel partners are onboard and developing their businesses.
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Most industry experts agree that the fundamental driver for the broad spectrum of transformation seen across the IT industry -- including vendors, users and partners -- is the third platform. In a recent blog post with predictions for 2015, IDC's Frank Gens, senior vice president and chief analyst, noted that the third platform, which encompasses cloud, mobility, big data and social media, is transforming not just the technology industry but also every industry on the planet. "The number of industry platforms -- industry-specialized cloud-based data and services platforms, usually created by leaders within the industry -- will expand rapidly, easily doubling in 2015," he wrote.
Tiffani Bova, vice president and distinguished analyst with Gartner Research, said that the digital business is upon us, meaning that all of the investments companies have been making over the past few years have formed the platform for the next transition.
Anurag AgrawalCEO and analyst, Techaisle
More specifically, "Virtualization, managed services and cloud are not the end game but rather the new starting point for how enterprises of all sizes will use technology to fundamentally change the way they sell and service their own customers," she said. Partners, she added, must focus on what technology can do for their customers, not just what they can do with technology.
The effects of this industry transformation can be seen in several channel trends, including those relating to verticalization and specialization strategies, managed services, staffing and skills, competitors, customers, and marketing.
Vertical industry and business model maturity
The partner community is becoming more sophisticated, with greater degrees of vertical expertise.
Anurag Agrawal, CEO and analyst with Techaisle, predicts that in 2015 vertical specialization will accelerate. "We believe that the growth rates for channel partners with horizontal specialization will be limited, but channel partners with vertical specialization will grow," he said.
In particular, he noted three types of specialization: advisors who provide technology consulting; integrators who specialize in integrating systems, data and applications; and solution experts capable of building solutions that alleviate the pain points of customers. "The vertical specialization category will fall into the third type," Agrawal said.
With more customers leveraging a combination of cloud and on-premises solutions, channel companies will have to become more adept at evaluating, integrating and administering various hybrid systems and services, according to Jeff Kaplan, managing director at technology consultancy ThinkStrategies.
"Channel companies will have to demonstrate a combination of technological skills in these hybrid environments and domain expertise in specific industries to satisfy their customers' vertical market requirements," he said. Partners who do this will gain competitive advantage.
Along the same lines, Seth Robinson, senior director and technology analyst at CompTIA, stated that in 2015 technology discussions will become more comprehensive and holistic as opposed to talking about topics such as cloud computing and mobility as separate topics.
"With cloud solutions an industry topic for about seven years and mobile solutions talked about for five years, these technologies have reached a level of maturity that companies won't focus on them as individual projects but rather as part of overall IT operations, i.e., the workflow, the overall maintenance and upkeep, data management, and security," he said. Organizations will fit these pieces together now that they have cloud and mobile solutions to build on, he added.
Managed services and beyond
The trend toward greater sophistication among managed service providers (MSPs) is already visible, according to Charles Weaver, CEO of MSPAlliance. That trend is taking shape in the form of MSPs with different areas of specialization working together.
"This is something we should pay attention to [in 2015] in that it solves a lot of issues for MSPs such as scalability, limited resources, limited bandwidth: overall, why MSPs don't grow as fast as we'd like them to at certain levels," Weaver said.
As channel models continue to churn in 2015, a new model that may crop up is an extension beyond managed services, suggested Robinson, who calls this partner type an integrated technology provider. "This is someone who goes beyond a managed service [that] might typically try to manage one piece of an IT operation and really become the overarching technology driver for a business," he said.
The integrated technology provider will dig in deep with a business, understand where it wants to go and proactively suggest technology solutions and the way these solutions can drive the business forward.
Staffing and skill sets
The resources MSPs need to deliver business solutions to customers are becoming more pressing while access to people willing to work inside a cloud and managed services environment is limited. "We're at an inflection point where we need to retool our training efforts to get more qualified people out of universities and colleges," Weaver said.
CompTIA's Robinson said that in 2015 CompTIA will be watching what partners will be doing about technology skills within their firms, noting that when it comes to hiring, job titles such as cloud architect and big data scientist may be the fastest-growing but more traditional skills such as used for help desk, networking and security are also in big demand.
Additionally, Robinson noted that along with technical skills, partners need to augment the soft skills in their organizations. In 2015, he said, "It's important for people to have business savvy but also know how to communicate, [explaining] how the technical solution is going to drive the business forward, how to voice concerns about things like security that might typically be seen as something holding the business back. Soft skills are becoming important and a challenge for technical workers to pick up or for businesses to construct a technical function that has both the hard and soft skill," he said.
Among other channel trends, partners should expect more competition from different sources in 2015. "They will see more competition directly from their vendors around cloud models but they'll also start to see new solution providers compete for their customers' dollars," said Diane Krakora, CEO of channel consultancy PartnerPath. The new types of competitors may be telecom master agents, service providers like Amazon or digital marketing agencies. These companies will all continue to strengthen their value proposition to end customers.
Relying on the way business has always been done as a way to survive in the future is riddled with risk, Bova said. "With every new startup that disrupts the status quo, partners must learn to build a much more agile culture that is able to respond more quickly to customer and market demands."
In 2015, solution providers may compete with companies that they partner with today, according to Bova. The old rules don't apply. How partners are able to navigate this shift will be key to their success, she said.
Power to the customer
Another factor in the changing landscape: customers. Bova cautioned that customers -- not any technology -- are the most disruptive aspect of business today. Customers hold the power, determining what kind of service or solution their business needs and how they will procure, buy and manage it, according to Bova.
The customer will also hold the influence as to who they will use as both provider and partner to get the job done, she said. "No longer are technology providers in control of the buyer's journey, which means neither is the indirect channel," Bova said. This shifts the way in which the channel sells, communicates and engages, with the customer becoming the new "competitive battleground," she added.
That dynamic is why marketing and presales activities will really matter in 2015.
"Successful … partners will use go-to-market strategies that combine industry expertise [and] consultative customer management strategies and will make substantial investment in presales resources," Agrawal said.
Traditionally weak in the area of marketing, partners will have to become adept at using technology for marketing to compete in a changing market if they hope to succeed.
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