The channel needs to change its approach if the Cloud is to become mainstream
Published 5/25/2018 by Janette Martin, Managing Director, Strategic Partnerships and Alliances
Moving to and integrating a Cloud strategy is fast becoming the first choice for positive digital disruption. We are seeing a strong appetite for the benefits that the Cloud will deliver to organisations but we are led to believe that businesses are well on their way to adoption. This is far from the truth. According to our recent Advanced report, just 33% of organisations admit to being experienced in the Cloud and continue to consider it for all new projects, while 37% have recently launched Cloud computing projects for the first time. Just like any purchase, a move to the Cloud should be considered with the same level of due diligence as any other significant investment.
If the Cloud is to become mainstream – both at an SME and enterprise level – the channel needs to change its approach. The challenge is that the channel, particularly smaller resellers, has become used to the revenue from up front licences. It uses a traditional financial management model where it is easy to manage revenue against forecasts. Monthly subscriptions for Cloud services are disrupting that financial model and the channel needs to adapt quickly to realise the benefits that this can deliver in recurring revenue.
Those that don’t adapt their business model to embrace Cloud technology will lose traction, customers and revenue. But changing business model isn’t straight forward either. The channel is saturated with vendors claiming to sell the next best technology and some of them try to promote products as Cloud-based – when they are actually not. This only creates confusion for customers, which in turn the channel partners have to manage.
Also, working with the same vendors for on-premise software doesn’t automatically make them the right choice for Cloud solutions. Resellers need to look to those vendors that deliver true Cloud solutions along with the right training, sales and marketing so products can be sold and supported effectively. They also need to work more closely with Cloud vendors to ensure that customers are provided with ongoing education and awareness, so their staff are engaged, confident and motivated to use the Cloud to help them work better.
The Cloud offers an incredible opportunity for the channel if resellers are able to transform their business models and their understanding of the Cloud. New Cloud solutions are driving opportunities to increase revenue and resellers should focus on the solutions that are designed to streamline key business processes. For example, we know access to real-time financial insights 24/7 is at the heart of every organisation’s success – so many businesses are ready to transform their financial operations, embracing the benefits that makes the Cloud and SaaS so attractive. This is exactly why we launched Business Cloud Essentials, which represents a huge business opportunity for resellers who embrace Cloud technology.
Vendors, Advanced included, are now taking a Cloud-first strategy because they are seeing lower digit growth in on-premise solutions and strong double digit growth for Cloud solutions.
Now is the time for channel to be more proactive with their existing base and focus on winning new customers. Resellers need to look for the right Cloud solutions to drive their business forward for the future while vendors need to step up to their responsibilities to ensure their channel resellers have the right, fit-for-purpose support they need.