According to Bill Gates` model of DNS (Digital Nervous System), corporate CEO and CIO`s are no longer interested in computerising their legacy business processes, but rather leveraging IT to provide value in terms of business intelligence and e-commerce.
The majority of system integrators however, come from a technical IT background, where there has always been sufficient skill set on servers and network infrastructure but very little in the way of actual business skills. In the past, purely selling product or services was sufficient to achieve those promised earning results for shareholders. The times have changed however and VARs need to rethink their strategy in today`s marketplace.
E-commerce is a generic term that encompasses a number of niche vertical markets, which may include, inter alia:
Document imaging & Workflow
Data mining and warehousing
ERP and CRM systems
Customer Relationship Management
Call Center technologies
Web enabled transacting
Supply chain management
The question thus begs, how do VARs leverage the years of investment (people, time, capital, training & infrastructure) that has been poured into their networking skills and at the same time, stay ahead of the pack by being closely involved in the emerging e-commerce and business intelligence, profit wave?
The answer lies in becoming a virtual SP or solution provider. In essence, a VAR must realise that it is impossible to offer an end to end business solution to a corporate, in today`s economic climate. Technologies change too quickly and qualified personnel change companies faster, than a CV can be mailed.
Virtual Solution Providing in essence, means that a VAR retains control of the account management of its client, but outsource the skill set or product that it does not have in-house, to a strategic business partner in the form of a joint venture.
For example, a corporate might contact their normal network/PC supplier for a strategic e-commerce solution, including an ERP system. The total solution would be split into different fields of expertise and outsourced to various players, which have demonstrated their expertise in those areas, without competing against the incumbent VAR`s core competency. The networking VAR acts as project manager throughout the entire planning and implementation process and retains "ownership" of the account.
A real world case study, for the above, would look similar to this model:
A virtual Solution Provider has thus been created, effectively transparent to the end user, but the breadth of skills sufficient to deliver an enterprise business solution to the corporate customer. At the same time, the typical networking VAR is leveraging its incumbent networking skill set, but without allowing new business opportunities to pass them by.
In conclusion, the prevailing mindset, that in order to partner, you need to split your profit, is effectively negated with the increase of business revenue which is generated by the new arenas that the VAR may become involved with.
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