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Robert: What do you see as the major issues currently facing the channel? Bill: Differentiation. Things rapidly change in this industry. Products commoditize a lot quicker than they used to. VARs need to learn new products quicker and to differentiate themselves from their competitors. Everyone is asking VARs to take commodities and incorporate them into true business solutions. In short, if a VAR wants to succeed, they have to become a Trusted Business Advisor. To be successful, many VARs will need to focus on specific solutions where they can become experts. Partners will struggle if they try to do everything. We are encouraging our partners to evolve their Virtualization practice to add Virtual Infrastructure Management expertise. Robert: In your world, what role do you want VARs to play? Bill: As a 100% channel focused company, VARs are the most critical component of our business. VARs have an opportunity with Akorri BalancePoint to enable customers to further advance their virtualization initiatives and move to private cloud environments. BalancePoint virtual infrastructure management enables them to be the IT advisor and virtualization expert to differentiate their virtualization offering. It enables them to go back to their customers and help them move the technology forward. Robert: Do VARs understand their role? Bill: Some do and are way ahead of the pack. We are providing more training to reach those that are starting to get it. Others will never get it. They have to be proactive as opposed to waiting for customers to reach out to them. Our solution enables them to offer services and bundle it in with server and storage hardware sales. Maybe 30% of the VARs understand this and are taking advantage of this new economy. 30% get it but are not there yet. The last 40% are still trying to sell commodities with no margins. Robert: Do they get it? Do they understand their role in virtualization? Bill: Virtualization introduces a lot of opportunities for VARs. Customers still have a lot of mixed physical and virtualized environments. VARs have to help customers maximize their ROI on virtualization. There s an opportunity for them to offer professional services to help customers fix performance problems and optimize their virtual infrastructure. Robert: Does a virtualized world make it easier for a VAR to charge for services? Bill: The real money for VARs comes when they have to roll out solutions and optimize the environment. Robert: How can VARs optimize environment? Bill: We refer to it as Partner Opportunities Across 3 Virtualization Phases
o The challenges for VARs are: power/cooling/rack space; improved utilization and server sprawl. o The opportunities for VARs are: bundle in high-margin software with hypervisor; sell servers, storage, and virtualization software; deliver basic PS opps.
o The challenges for VARs are: complexity and lack of visibility; VM sprawl; production app performance; managing virtual and physical; troubleshooting multiple layers; lack of confidence o The opportunities for VARs are: drive high margin software sales and virtualization software; enhance customer confidence; earn trusted advisor status, predict new server and storage needs, deliver key PS opps
o The challenges for VARs are: very complex; dynamic cross-domain; app-to-storage dependencies; getting meaningful metrics; heterogeneous mix o The opportunities for VARs are: additional sales of software, servers and storage; build on trusted advisor status; deliver more complex, higher margin PS opps Robert: Now, the question you want me to ask: what is the best overall solution? Bill: Akorri s BalancePoint Virtual Infrastructure Management. Robert: What are the major opportunities you see for the channel? Bill: Lots of people have jumped into virtualization. Now VARs need to help customers to use these products/solutions properly. Robert: What will the VAR of tomorrow look like? Bill: There will be different buckets of which a VAR can be in:
Robert: How will vendors have to change to make this possible? Bill: Management at the vendor level has to buy into what the VAR of the near future will be!!! They need to understand the importance of the channel. When a Vendor starts to compete against the channel, they are taking the first step towards destroying their channel. For those that want to buy direct, the Vendor should still send the VAR a commission check. ________________________________________
Robert Cohen, a passionate and enthusiastic channel advocate, is the founder of the ChannelLine Advisory Council as well as president and business editor of Integrated mar.com, publishers of Channel Advisor, eChannelLine and ConnectIT. Since 1980 he has worked with 350 IT vendors, distributors and resellers in developing and implementing strategic go-to-market programs, using a variety of direct, channel and hybrid models. Integrated mar.com, in conjunction with Robert has created the Trusted Business Advisor program. Robert can be reached at 1-800-465-2059 or by email at rcohen@integratedmar.com.
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