The new channel paradigm is based on programme automation and long-term relationships, says Billy MacInnes
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“The selling of the volume of the past does not deliver the value of the future.”
Those are the words of Gill Holloway, EMEA vice-president of partnerships at Insight, in a recent report on the MicroScope website from the EMEA Canalys Channel Forum.
The gist of the story concerned the shift by vendors away from rewarding partners based on transactions towards adding value instead.
Rachel Brindley, senior research director at Ondia, told attendees: “We are seeing a rapid shift as programmes move beyond the point of transaction. Our research now shows that there are over 400 programmes that are no longer purely transactional. A new paradigm has emerged.”
A points-based approach based on gaining specialisations, demonstrating support of the customer through the product or service lifecycle was becoming the norm, she added.
Given how long vendors have been banging the drum on this approach, I was slightly taken aback that it was only just becoming the norm. We are, after all, in a self-professedly fast-paced industry that continually promotes the virtues of agility and innovation.
It should be said that partners are not exactly rushing to embrace a model which is driving a fundamental shift in their relationship with vendors. Brindley noted there was an understandable concern about their future profitability.
Long-held loyalties were in danger of becoming more frayed as incentives shift, relationships change and the balance of power between vendor and partner was disrupted, she added.
No surprises there.
Brindley added that the programme changes were placing a greater emphasis on a smaller group of larger partners with more specialisations and skills: “The longer tail of SMB partners has always been managed by distribution, and it’s getting longer, and with AI, we will expect to see more of that through programme automation.”
This is interesting because I feel there’s an argument to be made that what’s happening to programmes for the larger partners reflects, at least in one aspect, what the smaller SMB partners have been doing for a long long time.
This isn’t about specialisations and skills but about the relationship beyond the transaction. For many smaller partners providing hardware, software and services to SMB customers, their relationship has always extended beyond the transactional.
How many SMB companies have the knowledge, staff and time in-house to devote to servicing and supporting their IT infrastructure once they’ve bought it? I would argue that’s why there’s a good chance most relationships between SMB customers and SMB partners are probably quite strong and the value part of that connection is fairly explicit.
In terms of specialisations and skills, there’s an argument to be made that the longstanding trend of packaging bundled technology solutions specifically for SMB customers is as effective a model for moving beyond the transactional as anything currently being promoted through the latest partner programmes.
In fact, its arguable that the end result of the shift described by Brindell could be more or less the same, that the relationship between large partners and corporate/enterprise customers develops along the same lines as those between their SMB counterparts.
Which is fine because the transaction does not define partners, vendors and customers. But what might be the hardest thing to appreciate, given the industry we operate in, is that the value is in the relationship, not the technology.