Are you still selling IT products? I don't mean pulling them through in your projects; I mean actively promoting certain products to your customers. If so, you may already be finding yourself in the minority.
Many MSPs have stopped actively promoting and selling products because they simply cannot make much money doing so. In fact, given the credit they may have to carry and the cost of operations to bring those products in and out, they may even lose money.
"I'm making plenty of money selling products." Some of you are probably thinking this right now. You have no problem selling products at high margin. If so, I congratulate you and encourage you to keep doing so...but that doesn't really change what I want to talk about today.
Back in the Old Days
There once was a time when all "resellers" could make great margin selling hardware and software. Personally, I saw that end around 1985. Others say it happened later.
At that time, vendors visited our offices regularly to show us new products in hopes we'd decide to actively promote them, add them to our line card and sell significant volume of them. In some cases, we did. Everyone made out well.
The Race to the Bottom
Eventually, some resellers decided to compete solely on price and discounted products down to basis points. Everybody lost; nobody made much money. But vendors kept coming in and a big part of their case for selling their products was the big margins we could realize on them.
That didn't work out too well. The discounters had knocked those whopping margins out of existence. Eventually we stopped the vendor when they started talking margin. Soon, they stopped even trying.
The Great Shift
Over an oddly long period of time beginning in the mid-1990s and continuing to this day, resellers stopped identifying themselves as resellers. An overwhelming majority of them adopted the title managed service provider (MSP) and shifting their focus from selling products to selling their own services.
Many resellers learned early to foster great relationships with their vendor partners. These came in handy when they had a thorny technical problem, or needed a pricing variation or other accommodation for a customer. In part, that relationship was easy to build thanks to the volume of product the partner was selling for the vendor.
As MSPs moved away from selling products, their leverage with the vendors faded. But they still wanted a good relationship with many vendors to enhance their access to technical resources and cooperative marketing opportunities.
Many vendors remembered the "Influencer" programs of old where partners were compensated directly for bringing deals even though they didn't sell the licenses themselves. They were paid simply for bringing the project and closing it. The most insightful among them realized that influence leverage was still available to them.
Clearly, MSPs benefited from having great vendor relationships, and so did the vendors. Sadly, some vendors still show up talking about margins.
Smart MSPs Know the Value of a Product -- to their Business
What is the value of a product to an MSP? It's clearly no longer a margin on the sale of it.
To find the value of any given product, start by thinking about how MSPs make money: They make the greatest profit selling their own services, if they manage them effectively. Consultation, provisioning, deployment, configuration, monitoring, management, capacity management and many more.
They can also make money on services provided by others, especially when they bundle them in with their own and others.
How Do MSPs Increase Their Revenue and Profits?
It's said that there are only two ways to increase revenue: Either sell more to your existing customers, or create new customers. And many will tell you its five times easier to sell more to existing customers than to create new ones.
The sales cycle for new customer acquisition is much longer, starting with finding candidates, then connecting with them, learning more about them, proposing solutions to the and winning their trust. With existing customers you cut all that out and start at the next proposed solution.
Add cost reduction to the formula and you're increasing profits, too.
What Do We Sell Next to Our Existing Customers?
Here's where vendors can come in really handy. (Vendors, if you're reading this, here's the shortcut to getting MSPs enthusiastic about selling your products.)
When a vendor visits, simply ask them what services you can wrap around their products. Think about it: You make money selling your services. If you want the fastest path to increased sales to existing customers, what you need most are new services to add to your portfolio of offerings. If you can wrap your services around an innovative product, you've just found exactly what you need -- more new services.
You can even go proactive with this. Ask your customers what they need that you aren't yet providing. Their answers will guide you to seek the right products to add to your services in order to fulfill their needs.
Advice to MSPs and Vendors
With all due respect, too many vendor representatives are still sent out with insufficient training. They learn their products' speeds and feeds, maybe some strategic advantages, and that's about it. Rare is the vendor who thinks through what MSPs need most for their customers.
As a result, when you ask what services can be wrapped around a given product, the visiting rep may not know, or have any ideas or inspirations. That's what vendors have product managers for. Ask that rep to get you on a call with their product managers to see if they can answer your question.
Vendors, my strongest recommendation is that you take time to prepare for this question, and answer it for your preferred MSPs even if they don't ask. The more services you enable them to provide to their customers, the more love you will earn from them -- and the more sales.
Posted by Howard M. Cohen on October 14, 20220 comments
The latest changes to the relationship between Microsoft channel partners and Microsoft itself have drawn many reactions from the partners. Some have called it "a scary time to be a Microsoft channel partner." Some claim Microsoft is taking advantage of market conditions to "hit partners when they're down." Others are running petitions to get Microsoft to reverse these decisions. None of this is new.
In 2000, Microsoft introduced the Microsoft Partner Program (MSPP), which was widely greeted as something long-needed. Naturally, it had the same challenges as any new program, but everyone negotiated and broadly agreed to move forward together happily.
In July 2009, Microsoft replaced the MSPP with the MPN, the Microsoft Partner Network, proudly announcing it was "not something you join, but something you're part of." It didn't take long for partners to find the pipe bomb hidden in the bunting. It was commonly referred to as "the exclusivity rule." Qualifying for any of the Microsoft partner competencies always required that four people pass specific tests. Those same four people could take tests for all the Gold competencies and pass them, meaning the partner would qualify for all 30 of the then-existing competencies. At that time, I was working at a partner that had 17 employees and held all but one competency, making us the No. 1 partner in the Partner Finder of that era.
With MPN, the "exclusivity rule" meant that nobody could take more than one test for one competency. If you wanted another competency, you'd need four other people to take the tests. And four more, and four more, etc. At our shop, we would need at least 116 employees to retain our competencies.
Partners were aghast. Kind of like they are right now about the Partner Competency Score (PCS).
Here's the Question You Have To Ask Yourself
It strikes me that I could just reach into the archives and pull this next thought right out of articles from a decade ago. With the introduction of the MPN, partners said it was a scary time to be in the channel, that Microsoft was hurting its partners, that they weren't sure if they would stay in the program. There was talk of finding "viable alternatives." Back then, the question I suggested partners ask themselves is the same question you should be asking yourself now: What do you really get out of your Microsoft relationship?
Along with that question, I made the suggestion that partners consider treating Microsoft with the same attitude they were treating us: benign neglect.
Benign Neglect
My good friend Richard Losciale often reminded us that we needed to maintain a posture of being "patriotically adversarial" with Microsoft. We love Microsoft, but we need to keep Microsoft honest. We need to maintain a strong voice when it does something that might injure us. At one time, I agreed with him totally, but experience has confirmed my decade-old belief that the best way to treat Microsoft is with benign neglect.
The only way Microsoft can hurt partners is by reducing their return on the relationship. Every time Microsoft messes with partner-of-record percentages or other compensation programs, it reduces the amount of money partners can earn on transactions. So, stop doing transactions. Stop selling Microsoft subscriptions of any kind. Let somebody else sell them -- like, say, Microsoft itself. That's very likely what will happen anyway, ultimately.
What I'm suggesting is that you join the legions of "non-transacting" partners. When I interviewed Gavriella Schuster upon her exit as channel chief, she spoke proudly about how many non-transacting partners Microsoft was adding every month. Clearly, Microsoft is good with it. You should be, too!
What do you think customers think about Gold Partners? With MPN, that concept was supposed to be gone; you could have Gold or Silver competencies, but you could no longer be a Gold Partner. With the upcoming Microsoft Cloud Partner Program (MCPP), Microsoft is abolishing it again. How many customers actually accord value to that appellation? If you stop worrying about having that logo to stick on your collateral and are willing to let Microsoft keep the pittance you can make selling its subscriptions, you can be free to do as you please, let Microsoft do as it pleases, and continue to build a brilliant business. Just treat Microsoft and its demands with completely benign neglect and the war ends for you.
People Engage You for You, Not What You Sell
Even as I write this, I'm convinced I'm overstating the obvious. Your customers don't buy from you because you sell Microsoft, or HP, or Cisco or any other vendor's products. They engage you for your intelligence, your talent, your expertise and your experience. They respect your performance, not your line card.
Some of you may cry, "But what about the resources Microsoft provides?" Do you seriously believe you can't find those elsewhere? You can obtain all the training you want from excellent Learning Center partners. There are now businesses that have built themselves to provide you with the technical resources you may not yet have on your own team.
What I'm saying, ultimately, is that Microsoft doesn't build cars and your IT practice is not a car dealership. You don't need to align with Microsoft formally. Doctors don't align with Pfizer or other pharmaceuticals to be able to prescribe their medications when necessary.
If you don't like the new MCPP, refuse to join it. Become a non-transacting partner. Take a look at the partner programs finally emerging from Google, Amazon and others. More customers use Android than Windows. More customers run SAP than Dynamics. Microsoft is not the top dog in any segment of software other than perhaps Office, and it hasn't been for years. Use and propose Microsoft products to your customers, but let someone else sell the licenses and be the master of your own ship.
Posted by Howard M. Cohen on March 29, 20220 comments
What do you love better than when a plan comes together? When two plans come together, together.
We've been reviewing the RCP 350 list of the top U.S. Microsoft partners over the past several months, and we've also been focusing on what ISVs, CSPs and other partners are doing to help their customers be better prepared for a hybrid future in which some people continue to work from home, some work in the office, and some go back and forth.
In this case, RCP 350 partner Workspot shared the story of one of its clients, Applied Software, and how they're strategizing for this distributed future.
About Workspot
Workspot took a good, hard look at everything customers didn't like about remote desktops and solved it. Customers liked virtual desktop infrastructure (VDI), but found managing and running VDI complex and cumbersome. They liked the idea of a company that delivered VDI services for them, but found that most of those companies were small and had inadequate cloud installations and spotty networks. Also, depending on where the client was and where the provider was, latency could be a serious factor when you want a desktop experience similar to local networking.
The Workspot Enterprise Desktop Cloud platform delivers complete cloud desktops to any device anywhere. It deploys quickly, scales almost effortlessly, is operated by experienced professionals with years in the business, and operates on Microsoft Azure, Amazon Web Services (AWS) and Google Cloud Platform (GCP). Super-reliable, infinitely scalable cloud resources running on the most durable, resilient, high-speed networks in the world. Each user's cloud desktop is delivered from the provider's datacenter that's physically nearest them to minimize latency.
Workspot has a deep well of VDI legacy; the chairman of its board of directors is former Citrix CEO Mark Templeton.
Applied Software and Its Challenge
Founded in 1982, Applied Software Technology Inc. (ASTI) has grown to become one of the largest architecture, engineering, construction, fabrication and manufacturing system integrators in North America, providing a comprehensive array of solutions, services and consulting with a singular focus on helping clients achieve higher performance. Services include software, training, support, consulting and custom development.
Customers commonly use GPU-based systems to run ASTI's very high-end engineering applications. This works very well when everyone is collaborating in the office on their high-powered workstations. The outbreak of the COVID-19 pandemic made that impossible. ASTI needed to find a way to enable customers equipped with their own laptops to continue to use the software, which had much higher demands.
ASTI's chosen solution was Workspot. Furnishing customers with Workspot subscriptions, ASTI located each user's workloads and cloud PC desktop in the Azure datacenter nearest them. It found it had all the control it needed over information governance, load balancing, performance monitoring and, ultimately, customer satisfaction. All the benefits of VDI without the headaches, and with the added flexibility to enable GPU-level performance in regular PCs.
Even the variations in configuration of customer devices didn't daunt ASTI. A user needed a specific NVIDIA driver for their display? No problem. Management and rationalization of storage? Made easy. Even the heaviest workload demands, including enormous graphic design files, were easily handled.
Planning for the Future
Foreseeing a coming staff shortage in their vertical industries, ASTI is already planning to help customers compensate for their lack of people power with more remote compute power using innovative techniques they've been building on the Workspot platform.
ASTI has given its customers the best of all possible worlds. Totally reliable infrastructure, totally resilient, full-availability, high-speed global network, and totally virtual control of the entire compute infrastructure. It plans to partner with Workspot to deliver its software for a long time to come.
Posted by Howard M. Cohen on February 03, 20220 comments
The "New Year predictions" article has always been my favorite to write because it's totally forward-looking and filled with enthusiasm for the future. Traditionally, on RCP, it has been titled "Marching Orders." I'm glad we're changing it this year because I have always felt the old title reflected a very Microsoft-like attitude toward partners, basically telling them what they need to be doing at any time.
The most successful partners have traditionally ignored that attitude and determined their own futures.
Everything else I'll talk about in this post will be based on a very specific definition of the seriously overused term, "digital transformation." What I've seen over the past several years has been gradual but tremendous change in the ways people use technology to improve their work and their lives. The people have transformed. How they approach life has transformed. Much of technology has adapted to accommodate them. In my 40 years as a citizen of the channel community, this is the most exciting, fulfilling development I've ever seen in tech. This makes it critical that we approach the future with eyes, and possibilities, wide open.
Going forward, the most competitive posture anyone can adopt is one of continuous digital transformation.
The Critical Role of the MSP as Transformation Guide
Your role as the technology thought leader for your clients could not be more important. To be in a constant state of transformation requires always being current on emerging technologies -- including the value and advantages they can deliver -- and innovating ways that you can deploy them to your own benefit.
For most clients, this is an enormous ask. Most lack the time to keep up with the continuous flow of new developments, new applications, new technologies and new techniques our industry produces. They have their own jobs to do. Think about how much time you yourself invest in keeping current with emerging tech. It's a full-time occupation!
But that's the whole point, isn't it? You spend a major proportion of your time learning about what's coming down the road. You fulfill your role in the lives and businesses of your clients when you take that new knowledge and apply it to each client's business challenges. You do the innovating and propose the next transformation (and the transformation after that) to each of them. As transforming becomes your clients' constant state, they absolutely need you to keep feeding the momentum with new ideas, new applications and new ways to improve their operations and increase their profits.
Shifting Paradigms
The fundamental way you look at technologies and how they integrate into businesses will evolve this year. Here are a few ways in which changes we've already seen begin happening will flourish in 2022 with your help.
1. Augmented Thinking
There's that famous old story about Einstein's teacher's thinking he was simple because he never remembered things. When then the teacher asked Einstein why, he explained that he didn't see the point in memorizing anything he could easily look up. As mobile devices and the SaaS that serves them become ever more sophisticated, and AI improves its ability to anticipate, we see mobile devices coming closer and closer to Alan Kay's original vision of the Dynabook, the personal digital assistant that could bring its user any information they needed at any time from anywhere, all transacted in natural language.
Bill Gates' original vision for Microsoft was "information at your fingertips." Please remember, that was 1975. In 2022, that's table stakes. "Google" has become a verb. When just about anybody needs to know something, they google it. That's Kay's and Gates' visions fulfilled. It also changes who we are and how we interact with our world, profoundly.
2. Placelessness
The COVID pandemic forced many transformations to kick into overdrive. A quarter-century ago, the CEO of Novell told us, "Work is now an activity, not a destination." Since March 2020, that has become overwhelmingly true.
The word "workplace" is already on its way to being completely redefined. In 2022, more people will come to realize they don't know where the person they're working with is physically located. And they don't really care! The entire nature of employment will change as hiring decisions are made without regard to physical proximity to any given office location. Technologies will emerge to make the work-from-home experience effortless and pleasant. Collaboration will expand to include AI participants. The content of our thoughts will become "king."
Nobody will know exactly where you're at. And they won't care!
3. Cloud Ubiquity
Up until now it's been a safe bet that everything is hybrid, mainly because everything has been in transition from on-premises to public and private cloud. For some, 2022 will be the year in which they achieve complete migration and find themselves fully in the cloud. In fact, many companies credit their sudden migration to WFH to the pandemic, with the switch being significantly easier thanks to their previous migration to the cloud. It also accelerated the completion of many such migrations.
The operational and financial possibilities are exciting. Cloud ubiquity -- the point at which cloud is a utility computing platform similar to gas, electric, telephone and water -- may not arrive in 2022 but we'll see significant progress toward it.
4. Automation Everywhere
There are still those who fear automation will replace humans and put many out of their jobs. Others are finding that the automation of things that really should be automated -- repetitive tasks or those requiring little thinking or decision-making -- is relieving them of many burdens and freeing them to do more meaningful work. Their satisfaction with their working lives is improving as a result. As more managers find more low-level work to automate, we're seeing a dramatic expansion of technologies and techniques.
Especially when all compute operations are executed in the cloud, the need for automation skyrockets. I anticipate seeing more and more MSPs also become automators of their clients' IT environments, applying sophisticated scripting and technologies to make more operations work by themselves. People get to focus on their work and not on the tools they do their work with.
5. DIY Low-Code/No-Code Apps
Putting more capability back in the hands of users, an astounding number of new platforms have emerged enabling anyone who knows their business processes to map them into applications without writing a stitch of code. Most of these are point-drag-click solutions that take a "building-block" approach to give users great flexibility and, again, much more power. Coding is becoming outmoded.
6. A Subscription Economy
Even now, you can subscribe to several different brands of automobile rather than own one. You can subscribe to a robot floor sweeper that will request replenishment of its consumable supplies as needed without your involvement. Computer ink-jet printers will re-order ink in a similar fashion. Ownership may start become an unwanted burden in 2022, or it might take a bit longer, but the potential for a more agile customer experience is breathtaking. That which you do not own is far more easily replaced when necessary, or desired.
This is totally consistent with the evolution of computing. The goal for so many of our newest technologies is to keep everything loosely coupled. That is, the failure of any one component should not cause cascade failure of everything else. We are living in a time of literal dis-integration, keeping the hardware, the software, the data, the transport, the storage, everything completely divorced from everything else. This makes everything instantly swappable and removes all the dependencies that have caused so much trouble in the past.
There is so much more transforming all around us, but let's focus down on what I suggest you enter 2022 doing.
Think Differently
Not a new concept, but totally necessary as our transformational velocity accelerates. One of my favorite quotations comes from legendary sales coach Zig Ziglar: "If you're doing what you've always done, you're probably getting what you always got."
Actually, I submit that you're getting less. For 2022, do new stuff.
Posted by Howard M. Cohen on December 29, 20210 comments
In 1998, the emergence of desktop publishing, digital printing and the Internet created an unprecedented opportunity for authors: self-publishing. Author Solutions was at the forefront of this pivotal change in the publishing industry and continues to be a global leader in self-publishing. Its imprints have helped more than 225,000 authors realize their dreams of publishing and have brought more than 310,000 new titles to market.
Thanks to Its Partner, It Was Ready When COVID Hit
When COVID-19 hit and everyone was sent to work from home, Author Solutions was able to move all of its domestic U.S. employees home and have them fully operational very quickly. CIO Joe Steinbach credits that to important work Author Solutions had already done with its partner, Advantage Communications Group.
"On the U.S. side," explains Steinbach, "we moved everybody to the work-from-home situation in three days. We got everybody out, everybody moved, and that was because of the work we had done with Advantage on our phone system and some of the communication platforms prior to to the pandemic hitting."
Author Solutions locations in other areas around the world were a more difficult challenge. With spotty connections and poor bandwidth for many of those employees, the company adopted a hybrid model of satellite offices that were still socially isolated.
"We have a lot of people who want to want to stay remote," says Steinbach, "and we've worked out a lot of the the initial issues. It seems that, of my direct reports, the only people who really want to come back to the office are the ones who have kids at home."
Steinbach then observes, "We're definitely in a different world order. Before this happened, the concept of work-from-home environment or not having people directly in the office and all the misconceptions that are tied to that -- that people don't work unless you're hovering over them and all that -- has been dispelled and there's a lot more of an acceptance, and there's a lot more openness to staying in a work-from-home or a remote environment. The things that were more difficult were how do you deal with the the isolation and the mental health effect of people being separated."
Steinbach credits the creative community at Author Solutions for coming up with virtual happy hours and other activities that went a long way to resolving these difficult issues.
Taking Advantage of Advice from Advantage
Steinbach appreciates the opportunity to work closely with the team at Advantage. He describes how they took him through the various options available to him when Author Solutions was upgrading its communications.
"We didn't just change the the phone system," he notes. "We actually changed the whole way we interact. The new phone client allows us to now have group meetings, to have chat, and to do a lot of things that became absolute necessities, in a remote workforce situation." Those things have improved processes and increased responsiveness throughout their enterprise, including service operations and human resources management. Â
Sam Riegel, director of enterprise sales at Advantage, recalls that Author Solutions' original request was to integrate its phone system with contacts in Salesforce to eliminate a great deal of manual work being done to reconcile and update various database issues. He points out, "If you have up-to-date interactions and you're working across multiple teams, multiple time zones, just having a single source of truth where it's regularly up and available, it gives you a lot more power and flexibility to get those updates out quickly."
Steinbach expands upon this, adding that the process improved their security posture, providing secure systems and allowing them to share business information with various resources remotely with superior security.
Riegel observes, "The desktop matters more and less than ever before. If you're running virtual desktops, you've also got to take into consideration that you're doing voice and video in real-time communication. The flexibility of users using their own device is also greater than ever and can be done in a way that is both secure and functional."
As of this writing, Author Solutions has stabilized its operations with a remote workforce that is completely prepared to get the job done for the foreseeable future, thanks to its partner relationship with Advantage.
Posted by Howard M. Cohen on November 15, 20210 comments
In their next round of decisions, your customers are going to determine who gets to continue working from home, who returns to the office, and who gets to switch back and forth. No matter what they decide, you need to be ready to help them achieve their goals.
This presents a whole new potential path of evolution for MSPs, one that wasn't really anticipated when we first launched this blog, but now may become the preferred go-to model for many.
First, Pick Your Acronym
Since "CSP" is already taken by Cloud Solution Providers, our choice between Collaboration Solutions Provider and Team Solutions Provider becomes simple. The key word is "Team."
That's a word that has most recently gone through the same re-definition mill we've put so many words through: cloud, partner, transformation, down, container, bit, farm and plenty of others. The most recent one is team. And customers all over the world are already seeking better team solutions, so the opportunity for Team Solutions Providers is already exploding.
So Much To Sell, and So Much of It MRR
I'm the guy who keeps insisting that monthly recurring revenue (MRR) is not the holy grail of computing services, but it's certainly a nice chunk of the whole picture. I still maintain that every project you undertake should lead you directly to MRR opportunities, and reading the reports from those MRR services should clue you into new project opportunities. The longer you can keep that looping around, the better off you are.
The argument between centralized and distributed computing seems over because even the users are now distributed. Everybody is everywhere. You can't just drop a big switch and router into a building and provision everyone to their productive futures. You also can't simply focus on securing the threat surface at that office building. Each employee's home is now part of your threat surface.
Looking at it the other way, you will need to sell your customers far more sophisticated security strategies, though secure access service edge (SASE) holds some promise to keep some expenses down. Users will need more mobile devices and more small gear to connect their mobile devices to the network. And everybody will need new communication and collaboration platforms, new data sharing and data security solutions. Most of all, everyone's IT policies will need a huge overhaul.
Everything just described represents a lot of new revenue for you as a service provider, and there's plenty more we haven't touched on yet. And this is where we get to turn the tables a bit.
You as a Team Solutions Provider (TSP) or Maybe a Remote Solutions Provider (RSP)
Solving and serving the needs of remote employees goes way beyond the mobile strategies many of us have been selling for years. The interactions are more varied and complicated -- home office to office, or to conference room, or all three, or hotel, airport, beach...who knows?
The nature of collaboration is poised to change, too, and that's extremely exciting.
We'd like to know your thoughts, what you're seeing out there among the remote workers. How are you helping them be more productive and less vulnerable? What services have you been providing to them that you never delivered before the pandemic? How is your practice expanding and how are you evolving as an MSP?
Let's discuss it! If you'd like to participate in this conversation, see your name in print, impress your friends and associates and demonstrate your thought-leadership, please e-mail me at hmc@hmcwritenow.com. Just tell me a bit about your company and yourself, and I'll turn around an invitation to chat so I can share your observations with your channel community. This is a great community -- help make it greater!
Posted by Howard M. Cohen on October 01, 20210 comments
"Agile" is a poor little word. We've batted it around mercilessly these past several years. It's good to see it coming into its own now that we realize how agile methodology delivers more agility.
Those who've been around long enough will remember the early days of Cisco and its few competitors. You needed to run software to manage these new-fangled routers, but then you kind of became a sysadmin so it was cool. Then the genius idea came: Put that programming into firmware built right into the box. Much more efficient and tighter management, right? Yeah, no so much.
We spent more than a decade correcting some of our earlier errors. We pulled the intelligence back out of routers and switches, even servers and storage devices. We realized that we'd have far more flexibility if the programming were all back where it belonged, on a computer. Yes, just any computer.
Thus we've come full circle, back to what we now call "software-defined networking," which we originally called "networking," and "software-defined storage," which we used to call "storage." We've come so far.
McNealy Was Right
Scott McNealy, founding chairman of Sun Microsystems, often said quotable things. One of his best was, "Those who cannot do, can sort." Loved that one; didn't pick on teachers. But McNealy was perhaps best known for saying, "The network is the computer!" Turns out he was right.
In what may stand as the grandest example of scaling out, the cloud has become a laterally scaled computing engine consisting of a network of smaller computers. We're able to transport commands, data, everything at electron speed from place to place, computer to computer, in order to compute at unheralded speeds with unparalleled flexibility and, yes, major agility.
Of course, we've needed new software technologies to get us there, but software technology is what we do. Our industry has produced SD-WAN for software-defined wide area networking, and there's software-defined storage such as Gluster and Ceph from Red Hat by way of the Open Systems Consortium. Then there's also the big player, microservices in containers, which has completely redefined coding applications.
Welcome, Cloud-Native Software
As with anything else in our industry, we needed to give it a category name, and since it's all meant to run in the cloud, why not call it all "cloud-native" technology? So we did.
Now, this may encourage some of you to have new business cards printed with "CNSP: Cloud-Native Software Provider" under your name. You're certainly welcome to do that, as so many of our "MSP" colleagues have.
But more to the point is the idea of creating a practice that only delivers software-defined networks, completely virtual datacenters in which code moves around as quickly and effortlessly between cloud locations as it does along the internal data bus in a PC. The network itself has become the computer, just as McNealy predicted, and you can provide that environmental computing platform to your customers today.
You offer significant cost-savings as all the network adapters, routers, switches, CSU/DSUs, modems and other devices once again become cheap slaves of the overlording management software, which is at your command. You use commodity storage drives configured in resilient RAID arrays and managed by your software to do whatever you need them to do. Again, costs are slashed as functionality is moved to less expensive hardware and far more capable software.
Control feels good, no?
Redefining Your Role in Your Customer's Compute Strategy
Everyone wants to become more "sticky" to their customers. While that sounds messy, it certainly makes sense to perpetuate your role and your revenue stream. When the network, the storage, the code, even the entire datacenter are defined by the software, and that software is managed by you...well, how much more sticky can you get?
Most every problem is immediately solved with redirection or inexpensive "hot spares." Scaling becomes something the network just does naturally. Support software speaks to supervisory software to solve anomalies. When the software runs the network and you run the software, you also control your customer. Powerful stuff.
Frequent readers of this blog and my other writings may have noticed that everything is grounded in a deeper understanding of the past, which helps us better understand why things are what they are and where they're most likely going. But the most important thing we examine -- which is also the most important thing you must examine -- is the future. Stare hard into the future and decide how you want to get there. Plan for your journey. Be the architect of your own tomorrow.
Posted by Howard M. Cohen on September 08, 20210 comments
Among our top 350 Microsoft partners in the United States is an awardee that was also among the first members of the original Microsoft Certified Solution Provider program in the early 1990s. Its pioneering nature continued as it adopted Azure when it was still code-named "Red Dog." It also lists the development of its own cloud adoption framework before Microsoft's as further evidence of its leadership.
Applied Information Sciences (AIS) clients range from startups to Fortune 100 companies and include state and local governments, as well as defense and national security agencies. It approximates a sales mix of 50 percent government and 50 percent commercial. It also estimates that 95 percent of the services it delivers are centered around Microsoft technologies with a focus on building solutions that impact its customers' mission.
Broad Engagement
AIS engages broadly with Microsoft, with its marketing manager working closely with its Microsoft Partner Development Manager (PDM). Its salespeople participate enthusiastically in co-selling activities with Microsoft. Its office of the CTO -- which includes solution directors, architects, solution specialists and others -- maintains close relationships with counterparts in the Microsoft technology community. Its CTO is a Microsoft MVP who has worked with Microsoft for more than 20 years. And its chief consulting officer maintains strong active relationships across Microsoft's executive leadership.
It also has dedicated teams for various vertical industries such as insurance, financial services, health and life sciences, and government, who align closely with their counterparts in the Microsoft industry-focused teams.
AIS executives regularly participate in partner advisory councils (PACs) to help guide Microsoft's partner program development. It's also a member of the Business Apps Inner Circle.
Competencies and Awards
AIS' impressive array of competencies and record of awards won speak volumes to its commitment to Microsoft technologies and customer success.
Having recently grown from 500 to 700 employees, AIS has earned over a dozen Microsoft Gold Competencies, including Application Development, Application Integration, Cloud Platform, Cloud Productivity, Collaboration and Content, Data Analytics, Data Platform, Datacenter, DevOps, Messaging, Project and Portfolio Management, and Security.
Starting in 1996 as Microsoft Partner of the Year, AIS has consistently excelled over the years, most recently winning 2013 Regional Azure Partner of the Year, 2017 Worldwide Partner Award for DevOps, 2018 U.S. Partner of the Year for Azure Performance, 2019 U.S. Partner of the Year for Business Applications - Dynamics 365 for Sales, and the 2020 Worldwide Partner of the Year for Power Apps and Power Automate Award.
Investments: Partnering Beyond the Partner Program
AIS Chief Growth Officer Aarish Gokaldas says, "We don't ever come to an exchange with Microsoft empty-handed," emphasizing that the key to an effective Microsoft relationship is to always maintain a solid quid pro quo in which Microsoft supports AIS and AIS supports Microsoft. "We are investing heavily in resources," explains Gokaldas, "in terms of strategic personnel with technical talent."
Given the current shortage of available skilled individuals, Gokaldas adds, "We are investing heavily in training. We bring in individuals that don't know anything about the Microsoft ecosystem and we provide internal training and professional development to get them spun up to the point that they're able to then go support our clients and have a mission impact.
"We invest heavily in intellectual property," he continues."We are building out our own IP that we're overlaying on top of Microsoft's technology. And then we invest in things like our marketing in campaigns to get get the message out that provides mutual success to both AIS, as well as Microsoft."
Gokaldas concludes, "And we're investing heavily in our sales and proposal side, putting skin in the game in terms of building out solutions, building capture with client engagements. We are never just sitting on the sidelines and relying on Microsoft to go in and do the work, relying on Microsoft to go out and build out the solutions. We're in lockstep with them. Or in some cases, we are leading."
To Boldly Go
"We're not afraid to venture into the unknown," explains Gokaldas. "We were an early adopter of Azure before it was called Azure. We understood the value of cloud, the value of migrating off-premises. And we were an early adopter."
AIS values its role as a beta tester for many Microsoft initiatives, including the early Azure, Power Apps, Power Automate and more. "We developed and built out a business dedicated to Power Platform of things like Azure Kubernetes. We saw beyond the value when it was created to the value that would would eventually be achieved when it matures.
"We are very much working in conjunction with Microsoft at the forefront of the technological landscape," concludes Gokaldas. "So things like our cloud delivery framework, our cloud acceleration hub, our...product focused around self-service, cataloging for the Azure environment, are all things that we're able to bring to bear to a client that helps accelerate their Azure journey."
Posted by Howard M. Cohen on August 20, 20210 comments
This is not the first "exit interview" I've ever done with a senior Microsoft official; in fact it's one of quite a few recently. But it feels very different than the others, so I'm going to write about it somewhat differently.
For one, I'm writing it in first person which I seldom do, but this issue is very personal to me so I feel it warrants it. I've been in the channel for quite some time -- in fact, since it was first referred to as a "channel" back in 1981. In that time I've had the honor of knowing and working with many people who held Gavriella Schuster's position as Microsoft channel chief, which was, generally speaking, a corporate vice president of the Microsoft Worldwide Partner Group/One Commercial Partner, etc. That includes Phil Sorgen, Jon Roskill, Allison Watson and Sam Jadallah. In fact, it goes all the way back to Jon Shirley, who was the closest thing there was to a channel chief from 1983 to 1990 when he was president and COO of Microsoft.
Gavriella is also the latest in a stream of senior executives making their exit from "the mother ship." Other recent exits include Dave Willis, Kate Johnson, Toni Townes-Whitley, Margo Day, Brad Anderson, Kurt DelBene, Peggy Johnson, Harry Shum and Watson.
Friends of the Channel
One thing that can be said for most of those who departed is that they were considered friends of Microsoft channel partners. That is by no means a prerequisite for global channel chiefs, as many of those serving in that role elsewhere often demonstrate.
It does seem, however, that even if those replacing Schuster and other partner-facing executives like Willis have been channel-friendly in the past, it doesn't seem like those are their new marching orders. We'll come back to this before the end of this article, but let's first say thanks to Schuster for her service.
What Do Partners Mean in a Cloud World?
Schuster explains that the partner ecosystem was not considered to be flourishing when she first started in the role seven years ago. People were asking what the role of partners was in Microsoft's future, what partners meant in a cloud world where customers could subscribe to the services online. Amazon was going all-direct on everything -- why couldn't Microsoft?
There was the question of what partners would actually do in this new cloud world. Cloud required no real implementation. They didn't have to do any hosting because Microsoft did that for them. Distribution was pretty much cut out by cloud, too. No need for logistics in the cloud. "All those things are true, we don't need them to do those things anymore," recalled Schuster. "But it doesn't mean we don't need them."
She saw her mission as needing to lead the team to redefine what partners actually do. "I had seen through my then-20 years at Microsoft that partners move pretty quickly. When you tell them, 'Here's the opportunity, here's what your business could look like,' they're pretty agile, way more agile than we are. So I guessed that if we pointed them to the north star, they would get there before we do."
Seven years later, she looks back with pride and declares, "We have another thriving ecosystem. It looks very different than it used to. I think partners are, amazingly, through all of this pandemic, more profitable than they've been in the past. They see more opportunity ahead. And I feel really proud of that."
Effective Partnership
Schuster's position is that "effective partner engagement is about making sure that you understand how you're going to get to profitability for everybody involved." She counsels channel managers to understand what the core of somebody else's business is. What is that particular partner really good at? Then you need to figure out how you help them make that even better and get to higher levels of profitability and differentiation.
She points out the important difference between being simply transactional and being a partner, describing the latter -- consistent with classic Microsoft philosophy -- as requiring an active quid pro quo in which the partner understands what Microsoft needs from them, and Microsoft understands what the partner needs to accomplish.
"I think partners are, amazingly, through all of this pandemic, more profitable than they've been in the past. They see more opportunity ahead. And I feel really proud of that."
Gavriella Schuster
"When you understand that, then you move beyond this being some transaction or utilitarian thing. It's a partnership. So I understand what we bring to the table, I understand what you're trying to accomplish, and how we can help you do that. And here's how you can help us accomplish what we want. When we do, everybody is more profitable. Everything works."
Don't Be the 'Pipeline Police'
Refreshingly, Schuster acknowledges that being a Microsoft channel manager "was a horrible job for somebody." She is careful to point out that they didn't function that way because they wanted to, but rather because of the way they were measured and incented. She refers to it as little more than "partner sales execution." Her perspective was that the team needed to be given a longer-term view of what they were required to accomplish.
Why She's Leaving and Where She's Going
Schuster attributes some of her reasoning for leaving to her experience during the pandemic. The pandemic meant not being able to visit with partners, which was the part of the job she loved most, and being relegated to more administrative duties. The fact is that few remain long in her role. Her seven years was only slightly exceeded by Allison Watson's eight, but most move on after two to four.
Since our interview, Schuster officially left Microsoft after helping her successor Rodney Clark with the transition in Microsoft's April-June fourth quarter. She formally announced her post-Microsoft plans in mid-August. "I have joined forces with several prominent organizations poised to address one of the most critical blockers in future technology innovation -- diversity, equity and inclusion," she said Wednesday in a blog post on the site of her new company, Gavriella Schuster, LLC.
She will pursue those aims as a member of the boards of several leading organizations, including Women in Cloud, Women in Technology Network, International Association of Microsoft Channel Partners, the SHE community, the Women's Business Collaborative and Corent Technology. She is also chairman of the advisory board for Artificial Solutions and a strategic advisor to Berkshire Partners.
Where Are We Going?
It has always been pleasant and interesting to interview Gavriella Schuster. One of the reasons it was so particularly interesting at this particular time has to do with the many conversations I've had with various partners across the ecosystem. They don't necessarily agree with Schuster that Microsoft and partners are working closer together than ever before.
And please remember that most of the partners I get to speak with are prominent members of the ecosystem -- people active in the IAMCP and partners listed in the RCP Top 350. People who make it their business to know and participate in what's really going on.
Some complain bitterly about encountering direct competition from Microsoft on deals they've been working. Several describe being "boxed out" of some deals. They report that all they hear when they complain is nothing more than "lip service." Many also describe how Microsoft is making it harder and harder to actually be a partner. More requirements. More expensive programs to buy into.
But the observation that struck me so profoundly, so personally, is that with Schuster's departure, it seems that Microsoft has now lost another senior executive who could be considered a friend to the channel. They claim that much of Microsoft's recent official messaging to partners seems to be very specific about their expectations of partners and that, to borrow a phrase, resistance is futile.
My Hope
My good friend Richard Losciale, a longtime leader in the ecosystem, describes the partner's relationship with Microsoft as being "patriotically adversarial." Remain true but speak truth, no matter how brutal. Now it sounds like the time for that may be over.
If they are correct, and I sincerely hope they're not, this may be a transition out of a period of friendly channel relationships with Microsoft into something new. If that's truly the case, then I must say I'm proud and fortunate to have enjoyed that relationship for a solid 40 years. A relationship of mutual interest, honesty and friendship. Sure hope to see it continue.
Posted by Howard M. Cohen on August 19, 20210 comments
For RCP 350 partner AvePoint, the company's level of co-sell achievement with Microsoft is a point of pride.
"AvePoint is one of the leading co-sell partners globally, and we're shooting for number one," says Christian Buckley, AvePoint's Microsoft go-to-market director. AvePoint is on the RCP 350, a qualitative list compiled by Redmond Channel Partner of the strongest Microsoft partner companies in the United States.
By co-sell, Buckley is referring to Microsoft's latest evolution of its constant commitment to partner-to-partner (P2P) partnering. According to Microsoft's definition, co-selling is any collaborative engagement between Microsoft and its partner ecosystem in a process involving building demand, sales planning, sharing sales leads, accelerating partner-to-partner empowered selling and delivering marketplace-led commerce.
Buckley, himself a Microsoft MVP, adds, "We're trying to shake the tree and make sure that internally at Microsoft, they're aware of what we're doing broadly, especially on the channel side."
This strategy is a key co-selling component for a partner like AvePoint, which has long provided other Microsoft partners with a wealth of software products designed to enhance Microsoft platform projects. Starting decades ago with SharePoint utilities, AvePoint today delivers augmentation products for Azure, Office 365 and Teams.
Covering All the 'Big Bets'
Successful longtime Microsoft partners have always known what the current "Big Bet" was, from Lync, the original predecessor to Teams, to SharePoint and others. They always knew investing in the Big Bets would put them right in the flowing stream of Microsoft marketing investments. AvePoint has clearly identified and focused on the three current Big Bets: Azure, Teams and Office 365.
As an ISV, AvePoint also realizes that its own best bet is to package its own intellectual property into products other Microsoft partners can resell. "How do you help the channel ecosystem transform from being resellers to trusted advisors?" asks Jason Beal, AvePoint senior vice president for Global Channel & Partner Ecosystems. "How do you help them moving from reselling single solutions to really developing intellectual property or building a business around the ecosystem? And that's exactly what we do."
As the Microsoft business has transformed from a licensing-based market to consumption-based transactions, AvePoint has successfully adjusted its mission to focus its efforts on increasing Azure, Office 365 and Teams consumption.
"AvePoint was among the earliest ISV partners to really make investments in the cloud long before the masses started to move in that direction, so we've been in this space longer than most," Buckley says. He also points out that AvePoint solutions are all built on the Microsoft stack for the Microsoft stack.
Deep Believers in the Co-Sell Motion
Beal believes it's critical for partners to fully adjust to the difference between consumption and procurement-based models. "Partners need to maximize the ecosystem opportunity, the services, additional ISVs, creating their own intellectual property. Those that seem to be doing the best, and seem to be expanding their market, have picked certain verticals," he says.
His formula includes combining Microsoft technology, AvePoint solutions and proprietary software specifically designed for a vertical and packaging it all as a repeatable solution they can sell over and over to customers within that vertical.
Buckley connects this to his core strategy for working well with Microsoft to optimize the return on that relationship. "Whoever you're working with at Microsoft, understand their commitments, what are they measured on. As a partner, you want to get more business, you want to get leads. That'll happen organically," he says. "The more you can align your activities and what you're trying to accomplish with helping them achieve their numbers to meet or beat their annual commitments, the more you're going to get responses out of them. That's the kind of the secret to work with Microsoft."
Posted by Howard M. Cohen on June 01, 20210 comments
Visitors to the Queue Associates Web site are immediately greeted with the declaration that it is "a global Microsoft Gold Certified Partner and leading Microsoft Dynamics 365 consultancy, in business for three decades."
No mistaking its commitment to Microsoft technologies.
When asked why he thought RCP listed it in the RCP 350 for top U.S. Microsoft partners in 2021, Founder and Managing Director Jeff Goldstein replies, "I would think for two reasons. Number one, last year we had a record year, despite the pandemic. Number two, we moved a lot of our clients to the cloud, so we did a lot of business transformation, moving existing clients from on-premises applications into the Microsoft cloud."
Goldstein, who served as president of the U.S. board of the International Association of Microsoft Channel Partners (IAMCP), proudly points out that Queue is the Largest Microsoft Dynamics partner in the New York metro area supporting customers worldwide. The company has offices in New York, Atlanta, Phoenix, London, Hong Kong and Osnabrück, Germany.
Reflecting further on the impact of the COVID pandemic, Goldstein points out, "When you're in front of a client, it's much easier to interview them, identify the requirements, do a whiteboard session, do the training. When you're doing it remotely, it's more difficult keeping the customer's attention."
On the other hand, he feels working from home has literally forced his people to be far more efficient than ever. "If a consultant had to take the train into New York to visit clients, they could only visit perhaps two clients a day. If they're lucky they'd really only get in four to six hours worth of work. Now sitting at home in front of their computer, they can easily schedule 10 one-hour sessions. And everybody is so very attentive for that one-hour meeting, they're not late, always on time. And then when the meeting is over, the meeting is over. The boundaries are very, very, very clear, in terms of what the time constraints are for a meeting. It has actually forced more structure. Our people are more efficient, because they can serve more clients in a day. There's no wasted time.
"What this pandemic has done is that all of our prospects who were on the fence about the cloud, the pandemic pushed them over the fence, and made it a must. When people come to our Web site, and they call us, they already know what they want. They say, 'I want Microsoft Dynamics 365 Business Central Essentials, Teams seats, and they know the prices.' When they come, they're already sold. It's just a matter of why should they work with Queue as opposed to somebody else."
As for the bet-the-business commitment to Microsoft, Goldstein credits Microsoft's scale and stability as one of the biggest companies in the world. "Microsoft generates a lot of opportunities for us. People used to say, 'Nobody ever got fired for buying IBM,' right? Well, now, it's the same way with Microsoft. People go out and say, 'Listen, I selected Microsoft. That's the best. It's the gold standard. So Microsoft is the new IBM, nobody ever got fired for buying Microsoft.'"
At the same time, it can be tough for a partner to navigate an organization as huge as Microsoft. Goldstein finds advantages in being selected as a managed partner.
"My perception of Microsoft is going to be only as good as the guy I deal with every day, right? If I work well with the guy and the guy takes care of us, I love Microsoft. If the guy doesn't take care of us, blows us off, then I don't like Microsoft. That's what it comes down to. I'm not working with Satya Nadella. I deal with one guy who manages 20 partners. When I have a problem, I call him and he takes care of my problem. And that's why I love Microsoft," Goldstein says. "Basically, people partner with people."
Posted by Howard M. Cohen on May 20, 20210 comments
The Henson Group is fully onboard with Microsoft's pledge to become carbon negative by 2030.
Microsoft made the commitment as a company in January 2020, setting a 10-year deadline to capture more planet-heating carbon dioxide than it emits. The company also pledged that by 2050 it would remove the equivalent of all the carbon dioxide it's released since 1975 when the company began.
"We're now a carbon neutral company!" Henson Group declares on its Web site. "Henson Group is committed to operating sustainably by continuously working to measure and reduce our carbon footprint across the globe, including leasing office space in Green Certified buildings, minimizing business travel, purchasing energy-efficient equipment, and many more carbon-neutral activities."
Henson Group is an award-winning Microsoft partner with gold status in several solutions competencies, including the exclusive Azure Expert MSP designation. In business for more than 15 years, Henson Group today has more than 600 employees and affiliates servicing hundreds of clients in dozens of industries delivering cloud services, on-premises solutions, support, licensing and more for clients worldwide.
Its strategy of hiring architects, engineers and developers who are former Microsoft personnel, like CEO Greg Henson himself, helps lead to relationships with Microsoft product groups and executives that give it access to code and knowledge not generally available to competitors.
With his company named in the RCP 350 list of the top 350 Microsoft partners in the United States, Henson attributed much of its success to its commitment to diversity and inclusion. "We have a pretty diverse group of folks. In fact, women and minorities make up half of our senior leadership team. So I'm proud of that," Henson said.
But he also believes the carbon neutrality will be a differentiator in the near future. "We're a carbon-neutral Azure Expert MSP," he said.
Henson takes great pride in being an Azure Expert MSP and points to it as a primary reason he feels his company was selected. "It's the best of the best, the cream of the crop, when it comes to Azure migration. There are a lot of gold partners out there, and anyone with five or more employees can really go out and get a gold competency," he said. However, there are only about 70 Azure Expert MSPs, making it a valuable badge for a partner. "It's definitely a prestigious and grueling attainment."
How grueling is the Azure Expert MSP program? Among other more routine requirements, Azure Expert MSPs need to bring on third-party auditors, sit for multiday audits and go through the renewal on an annual basis.
Obviously, not every partner can earn the Azure Expert MSP badge, but Henson has advice for ways other partners can gain visibility within Microsoft.
Just as it promotes its Microsoft certifications and capabilities to prospective customers, the team at Henson Group similarly actively promotes the same to Microsoft's reps throughout the United States, including field sellers, inside sellers and vertical sellers. Henson pointed out that the value of this visibility is to reach out to the Microsoft sales folks to engage them on their opportunities.
One of his challenges has to do with frequent changes in the people he works with locally, and at Microsoft headquarters, as well. While he acknowledges the value of building relationships with channel chiefs and other executives, you need to be ready to rebuild those from scratch every few years. This is another reason he places so much value on building relationships with the field sellers and inside sellers: They expose you to more opportunity over a somewhat longer period of time.
Henson is also excited about the ISV, health care, retail, nonprofit and other verticals Microsoft has begun emphasizing. "A lot of partners are very vertically specific. Now they have those dedicated sales teams, those dedicated verticals and now dedicated clouds."
Finally, Henson recommends aligning with Microsoft's civic causes when those mesh with your own social priorities. Their carbon-neutral status is just one example of that, demonstrating that The Henson Group is a committed Microsoft partner in more ways than one.
Posted by Howard M. Cohen on April 22, 20210 comments