Channel partner ecosystems evolve to support digital disruption

Over the past several months, TBR has seen increased activity and interest around the topic of channel and alliance strategy across our 12 ICT industry coverage domains. While channel and alliance strategy is a pervasive topic, the intensity and tenor of the questions posed recently signal an increased focus around deploying industry-leading partnering strategies to pursue long-term growth.

Some of the common recent questions we’ve fielded from our clients include:

• We’ve been partnering with global systems integrators (GSIs) for years, but our relationship in this emerging technology or service area is new. What is the right engagement model for this new area? What revenues can we expect? How do we establish a stronger relationship than our peers?
• Our competition in this new portfolio area has stronger relationships than we do. How do we develop programs, incentives and recruitment strategies to secure partner engagement?
• What are the right partners to engage with to achieve our objectives in this area? What type of programs, engagement models, incentives, benefits and management structure will resonate with those partners?

While these questions themselves aren’t entirely new territory, the systemic market forces that underpin them are certainly disruptive to partnering models for many ICT providers. The quote below, from TBR’s 1H18 Cloud Applications Customer Research, speaks to how the economics of cloud and digital IT consumption impacts the role of the services partner in applications deployment:

“Partners are still an integral part of almost every deal we do, but most deployments are no longer $10 million to $20 million to get it installed — now [it’s] just about $1 million. Many companies have shrunk their IT departments over time because of cloud, leading to skills gaps, so partners are so important.”

— Senior Director of Procurement, Telecommunications

Partners will continue to fill a critical role for enterprise customers and, by proxy, leading technology companies, but digital disruption will continue to shift how vendors think about partner roles. A few ways we are seeing technology disruption impact vendors’ partner programs and strategies include:

• Self-developing Partner Ecosystems: Firms are creating formal programs and incentives to encourage partner-to-partner relationship development and joint go-to-market activity (i.e., a marketplace ISV engaging with a reseller to jointly support a customer).
• Partner Stickiness and Specialization: Leaders use partners as a conduit to specialize by industry, use case or region, and are encouraging partners to expand portfolios and enhance industry and/or solution specialization (i.e., cross-training ISV partners as implementers in an industry).
• Partner Journeys: Vendors are reconsidering traditional partner tier structures and aligning program tier requirements and benefits to reclassify partners around long-term value opportunity versus purely revenue generation.

I’ll be conducting a webinar on Wednesday, April 17 at 1 p.m. EDT that will dive into these trends and others in greater detail. Click here to register for the webinar. For questions on this or anything else, you can contact me at [email protected].