Johannesburg, 26 Feb 2020
Companies rely on the channel to deliver value and align technology investments with their primary business outcomes. Technology for technology’s sake is receding fast as mainstream decision-makers tie their digital spend to concrete indicators.
Some 87% of organisations across the globe rely on outside technology service providers. The services most in demand, according to CompTIA’s report, titled International Trends in Technology and Workforce, are troubleshooting, repair and maintenance, followed by consultations, and then deployments (cloud and migrations). Security and software development fill out the rest of the list.
Vendors are at the other end of this transaction, providing the original software and hardware that digital requires. The channel connects these two worlds, but it also relies on vendors to help maintain the pipeline. A vendor can make or break any technology investment. Knowing the vendor can tell you a lot about the quality of its partners.
So, we should ask: Who is the vendor and, other than products, what should they offer?
Not so direct
For a brief time, vendors or Original Equipment Manufacturers (OEMs) looked at providing services directly to exclude parts of the channel. The arrival of cloud and services had briefly created the impression that vendors could sell directly to customers. Though some have tried and succeeded, the overwhelming complexity of technology created more demand for channel partners.
“The delivery of technology solutions is more complex than buying a consumer product from an e-retailer, especially when said product breaks,” explains Rakesh Parbhoo, CEO of Westcon-Comstor Sub-Saharan Africa.
“Even software needs to be supported and integrated. Buying your Office 365 from Microsoft is fantastic. But what happens when you need to merge Teams to your Cisco environment, or you need to scale your database to support micro services? On paper, it looks good. But the reality has prompted many vendors to roll back into their channel for the value-added services, support and integration they can provide to the customer on the ground.”
Who is the vendor?
Direct-to-customer services were always going to be limited. Vendors need the rest of the channel for numerous functions, such as limiting financial exposure, says Parbhoo: “Vendors work through tiered channel partner ecosystems to spread the financial risk of delivering products and services. Partners help them achieve better time to market and support their technologies in geographies where they don’t have a physical presence. Just like you can’t break the laws of physics, you also can’t break the laws of customer support and thrive.”
An effective vendor relies on distributors to act as the nucleus for its efforts. Here the various pieces of an OEM’s offerings come together, as distributors are used to equip systems integrators, solution providers and resellers. Such a vendor also promotes certifications to validate its relevance.
Certifications indicate the health and position of a vendor in the market. Facing massive demand for technology skills, astute vendors pursue certification training among their partners.
Parbhoo explains: “Certifications are a sign of good business. Any company delivering a technology solution needs to do so to the best of their ability, and certifications are a way to validate this. Relationships with vendors aren’t built as a result of certifications. Rather, certifications can pave the way for successful relationships because of the credibility and customer success that they have fostered. More often than not, they are delivered by the channel.”
The power of relationships
After OEMs investigated ways to satisfy the end-customer demand directly, the need to satisfy demanding customers has brought vendors, distributors and partners closer together. Leading vendors are considerably more involved with the roadmaps and strategies of their partners, which are driven by distribution.
They also offer more opportunities through lead generation, discounts and improved rebate programmes. Of late, there has been competition among vendors to re-energise their partner arrangements. This trend is in lockstep with an expectation that the partners must help the vendor deliver on promises to the customers.
Good vendors no longer sell and forget, but collaborate towards value. This has changed how they select and elevate partners, says Parbhoo: “Relationships are no longer built purely on who has served a company the longest, but rather on who serves a company and its brand the best. Success, service delivery, business ethics and time to market are the new expected standard. The days of broad-based distribution, where a company could offload a million widgets and then just walk away, are gone. Long gone.”
What defines a good vendor? They depend on partners that are responsive and skilled to meet customer requirements, supporting those networks with certification, business development and other benefits. They align with partners that offer long-term value to customers.
To deliver that value, such vendors collaborate with their partners around maintenance, consultation and deployment. Stealing a partner’s sale is now widely frowned upon. But the ultimate measure of quality is not in sales or vendor-partner relationships, says Parbhoo: “As much as we, the channel, need to have favourable partnerships, we can never lose sight of the end-goal: a happy end-user, with a working solution that meets their business needs and is delivering on what they initially needed.”
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