Archive for the ‘Platform Vendor’ Tag

A Big Step For Microsoft and Cloud Ecosystems, a New Step In My Own Collaboration on Alliances   1 comment

Yesterday I published a new post on the impact of the new Outlook.com service on Microsoft’s partner ecosystem.
I believe this service is much more than a revamping of Hotmail; it is a key development in the impact of cloud business models on partner ecosystems for Microsoft and other platform vendors. It affects the whole partner ecosystem from OEM to distributors and resellers, to systems integrators and ISVs.

This post also marks a new development for me: I have published it as guest on the blog of a fellow alliances professional, Peter Simoons.

I look forward to exploring this collaboration and others among alliances practitioners. It will be interesting to see how alliances develop among alliance managers.

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Measuring Alliances in ICT Systems Integration and Other Industries: How Easy?   16 comments

Update: this post has driven valuable discussion with many colleagues – thank you!
I have captured the main conclusion in a later post on qualitative alliance metrics focused on the quality of relationship.

My company is reviewing how we manage alliances as part of our region’s systems integration business.
This has given me a great opportunity: look hard at alliance metrics again, in the field, with very individual stakeholders looking personally after a business. 

At the same time, two recent ASAP events have discussed alliance metrics.

Both ASAP events describe alliance measurement as difficult, while my experience indicates measuring alliances is actually quite easy.

My experience focuses on a specific industry and business model: Information and Communication Technology (ICT) alliances between global systems integrators, platform partners and their ecosystem.
This focus may well make measuring easier than in broader contexts, still I believe simple guidelines such as those I propose below can make alliance measurement easy anywhere.

Let’s look at the two ASAP events, and their thesis:

Quintile’s webinar focused on managing the execution of an alliance’s joint strategy map:
First, draw a map of the alliance’s strategic objectives.
Then, define metrics based on the objectives, to track progress towards each.
Finally, as a governance committee, define and execute work streams that pursue these objectives, and so advance these metrics.
A steering committee will then manage strategy execution by assessing progress of the work streams through tracking of corresponding metrics.
This webinar focused on the process, deferring to specifics of each partner and alliance to identify strategic objectives and so metrics.

The Benelux round table, according to reports above, also highlighted how complex and specific defining alliance metrics is, and how complexity grows with the scope of the alliance, or portfolio of alliances. The consensus at the table was that each alliance needs its own metrics, depending on its own objectives.

The lesson of the two events is clear and consistent.

How may alliance measurement become easier?

I believe the choice of metrics is in fact easier than described above, and that choosing the right metrics makes easier both tracking them and measuring the alliance or portfolio.
To keep alliance measurement simple, I believe we can use two guidelines:

  • Base alliance metrics on each partner’s business metrics.
    Choose very few of them, among those business metrics that the alliance aims to impact most, such as sales, margins, innovation of solutions.
  • Tune each alliance metric to the specifics of each alliance, and keep it consistent with metrics for other alliances, by answering one simple question: how will we decide that any one contribution to a company’s business metric is associated to one specific alliance?
    For instance: how can we tell that a given alliance has indeed driven a given new sale? 

Following these two guidelines helps keeping alliance metric results consistent and comparable with the partners’ overall business results, and minimizes tracking effort. This in turn is especially relevant for ambitious, high impact alliances that aim – and claim – to influence a significant share of each partner’s business.  

The second guideline also helps meet a key requirement for an alliance’s success within each partner: that the alliance matches both partners’ cultures.
Each company has strong beliefs, powerful stories, about who wins business, and how. The more consistent we can make the rules measuring alliances with these stories, the more executives and field teams will be prepared to appreciate a contribution from a specific alliance, and so to embrace that alliance.  

What do you think can make measuring alliances easier, in ICT and other industries?

Update: three LinkedIn alliances discussion groups are providing valuable comments in addition to those below:

  1. Alliance & Channels / IT & Telecom – requires admission; members will find the discussion here
  2. Association of Strategic Alliance Professionals – also requiring admission; members find the discussion here
  3. Alliance & Channels Friends – an open group, the discussion is here

I look forward to taking stock of all these suggestions in a following post and in daily alliances practice.

When IT Consumerization Meets Cloud – Of Large Software Enterprises and Their Customers   Leave a comment

A great post at Pandodaily I meant to reblog here. http://pandodaily.com/2012/02/11/why-oracle-may-really-be-doomed-this-time/

Aimed at Oracle, relevant for many or all large software enterprises and their enterprise customers.

What is Happening in Enterprise ICT Alliances and Channel in Italy – Early Results   4 comments

Italian translation available – disponibile la traduzione italiana. Text revised on 30 Jan 2012.

I am gathering insight on enterprise Information and Communication Technology (ICT) alliances and channel evolution in Italy. Information comes from selected local and global market analysts, large and small systems integrators, resellers and distributors, Independent Software Vendors (ISVs) and software platform vendors (the category including global players such as HP, IBM, Microsoft, Oracle, SAP, and a few others).

More evidence will be required for meaningful conclusions, still I am finding early results interesting and useful for our daily work, both individually and as part of my organization, evolving to develop our alliance teaming capability as well as very high value added resale capability.

My personal understanding so far: ICT partner management, including both asymmetric, one-to-many channel relations and symmetric, one-to-one, essentially peer-to-peer alliance relations, is going through intense and disruptive evolution. I believe this evolution is stronger than standard sales discipline and even response to a challenging economic environment can explain. New categories of enterprise ICT partners are emerging to compete with existing ones, while incumbents are developing new behaviors to answer this competition.
In Italy, this is providing ICT market players with new opportunities to overcome historical fragmentation. Over time, it might even become possible to define new partner business models that leverage local specifics in original ways, somehow like networks of small enterprises in regional districts had innovated manufacturing around the 1980s.  

Let me start by setting some local context. I see two distinguishing features in the Italian ICT partner ecosystem:

  • it is highly fragmented, just as our enterprise ICT customer market (analysts monitor and report on more than a dozen thousand suppliers and intermediaries, and on a number of enterprise end customers that is in the same order of magnitude).
  • credit access is relatively complex for enterprises large and small, so resellers and distributors put significant resources to bridge  customer and supplier requirements on payment terms.

This combination impacts channel operators as well as enterprise platform vendors at the supplying end of the channel.
Resellers and distributors must focus on breadth and transactional efficiency, which reduces resources available for offering innovation, differentiation from competitors, and development of true alliances.
Platform vendors, on the other side, struggle to distinguish among so many partners so alike, to recognize, reward and drive the most effective behaviors, and with them innovation and efficiency in their channel.

In this context, I see two major global trends causing disruptive change, that can have special results in our country.

The first is cloud-enabled globalization: cloud architectures and business models for both enterprise and consumer ICT are helping fulfill the long due promise of global, fully location-independent service delivery for advanced small and medium market players. An independent software vendor from any country can combine their own innovative solutions with relevant innovations from others elsewhere, then deliver the result to customers of both, and to new customers in new locations. This has allowed success of Software as a Service vendors, and much greater market reach for more traditional on-premise software vendors.

The second is really the partner management side of consumerization: new ICT platform vendors coming from the consumer market, with their specific business and partner models, have entered the enterprise market with a vengeance. After few years, we see they have significantly adapted their partner models to this new environment. Established global platform vendors and their channel and alliance partners have been adapting, sometimes scrambling to adapt, applying their partner models more rigorously and innovating them in the process.

Working mostly with large enterprise platform vendors and their channel and alliance partners, I have seen some incremental results of these two trends, and some more innovative, truly disruptive.

Among incremental developments, enterprise platform vendors have increased their investment in partner management discipline, to identify and grow partners that provide the most value. They have introduced, or significantly strengthened, such standard partner management tools as competency certification; they have increased certification requirements, and made competencies more specific and differentiated. They have improved lead registration and reward programs, and the few who could afford to ignore them are adopting them. Those that had long privileged asymmetric channel relations with smaller, more complying partners have now opened up to managing selected relations as more symmetric alliances, each with its specific set of values, objectives, and management practices, tuned to the business model of both partners. Some platform vendors are now segmenting their partner portfolio just as carefully as they do their customer portfolio, and matching partner segments to customer segments more carefully. Many are now much more deliberate in how their direct sales and indirect sales separate, or cooperate.

Most of this is the result of global best practices. Applying it to Italy’s special environment has been complex, with a significant change management effort, if medium term results may well be better than in other countries. Some vendors for instance are still working to obtain from their greater partner management investment and discipline the ability to find and develop those special partners who “pull the most weight”, in terms of vendor business they embed and drive in their own.

Other results of the same trends appear to me more disruptive and innovative.

An important one has been making repeatable, formally defined solutions an essential part of how platform vendors and their partners deliver value to their customers. In addition to improving delivery efficiency, this is helping partners differentiate from each other, and platform vendors perceive this differentiation. Solutions make a more tangible, understandable and rewarding object to team around, sell together and measure success of, than prescriptive behavior models. This value of solutions applies both to asymmetric channel relations with small partners, and with more symmetric alliances among near-peers.
For smaller partners, solutions are really vendor-supplied solution blueprints; each platform vendor challenges and encourages all partners to take up these blueprints, add value to them, and sell the result.
For partners with more complex business models, it’s the partner that proposes solutions to team around to the platform vendor.
In alliances, the approach is closer to joint solution development by both partners, who then cooperate in selling and delivering it, together and in parallel.
For all kinds of partners, solutions become the catalyst of teaming: solutions are what teaming is really about, what makes a given partnership stand out from other similar relations.

Perhaps the most interesting development from innovation trends in enterprise ICT partner management I am seeing in Italy involves Independent Software Vendors. ISVs often benefit from these trends in many ways, for instance:

  • platform vendors, seeking to understand partner value and distinguish among partners, find ISVs and their solutions easier to assess, compare and manage. This helps them choose among ISV solutions, and most importantly makes it easier to measure and reward success.
    In ISV solutions as well as in those of platform vendors, much of the value is embedded in the features of a software product. Measuring and rewarding mutual contribution to success becomes much easier for both partners than when either works with a traditional partner.
  • Small, niche ISVs are in a great position to leverage the opportunity for location-independent value delivery that cloud platforms and internet channels are providing. Truly innovative, valuable ISV solutions can reach global markets with very limited effort.

In my experience, this has happened mostly with international – single-country or global – ISVs working or entering the Italian market. Personally, I have yet to see significant examples of Italy-based ISVs taking similar approaches in working with platform vendors.

What is the result for enterprise ICT partner management overall?
It seems to me that this greater mutual clarity, and better ISV access to market, are allowing more and more, smaller and higher value ISVs to compete with distributors and resellers for platform vendor support and for customer access. In some cases this better access to platform vendor rewards is encouraging ISVs to take sides and focus their product strategy on a single platform among competing ones, as a way to forge more direct connections with that platform’s vendor.
Conversely, I see platform vendors who used to be skeptical about ISVs and propose implementations of their own solutions instead of ISV solutions, now gradually opening to the value that an ISV solution can provide on top of the platform it leverages, as it reaches more easily market niches where the traditional channels would require more complex integrations. These vendors start to team more and more with ISVs for sales.

This evolution challenges more traditional channel and alliance partners, such as distributors, resellers, and general-purpose systems integrators. It happens in at least two ways. 
On the one hand ISV solutions, often configured and enriched by more specialized, solution-focuses systems integrators, add to competition for general-purpose integrators. On the other hand, ISV and systems integrators find great value in teaming with each other. In pursuing this, ISVs can provide a further stimulus for systems integrators to focus their offering in solutions, built more and more around selected ISV solutions.

Early discussions suggest this requires significant investment by platform vendors, ISV and traditional partners. Specifically, the change is about offerings and how to define, manage and even communicate partner relations to partners themselves and the market. In our fragmented Italian market, I am seeing evidence that some platform vendors, ISVs, and systems integrators are strongly interested in this.

Three-way ICT Alliance Teaming – a Success Case   Leave a comment

In Italy, one of my organization’s largest businesses, we have introduced a three-way alliance teaming approach that combines strengths from different kinds of partners.

My organization is a global systems integrator. We have teamed with our key partner among platform vendors to engage ISVs in their ecosystem. We go to market together with each engaged ISV both on any one opportunity and on solution-specific campaigns.

Results so far (after 6 months pilot, + 6 month deployment):

  1. Dozens of net new leads generated for later joint qualification.
  2. Multiple leads qualified into opportunities, a few closed successfully.
    Each new deal closed so far has been in some way superior to average deals: either it was larger than average, or it positioned a new joint solution, or it engaged a new customer.
  3. Better solution-level teaming for the two major partners.
    Having ISV components in a solution makes much more tangible for the systems integrator and the platform vendor what are we actually teaming on, and what special value does our joint customer receive from this teaming compared with other possible teaming options.
  4. Clearer, stronger positioning of the ISV in the partner portfolio of the others.
    When we choose to partner three-way, this gives the ISV a special role with each of the other partners.
  5. Additional, ISV-specific value for each partner and our joint customer.
    Sometimes there is a specific element of value for our joint customer that the ISV is best positioned to give.
    Sometimes the platform vendor can help the ISV better than they could help the systems integrator.
  6. Better value for my organization as systems integrator.
    Some ISVs are better aware of the specific value of our organization as partner than platform vendors are, or better positioned to leverage that value. This makes them better at rewarding us and our clients.
    Also, many such ISVs have more proactive sales approaches than platform vendors and generate a higher share of teaming opportunities.

Key features of this approach include:

  • Choosing ISVs carefully, based on criteria that address the needs of this specific alliance.
    For instance, all three partners need understand the differential value the ISV solutions bring compared with platform vendor solutions and systems integrator offerings.
  • Empowering solution sales leads in the systems integrator and platform vendor teams.
    Solution sales leads own solution blueprints and solution sales campaigns. They have the key responsibility to select what ISV products work best in their solution blueprints, and assess how good a support ISVs offer. They are in the best place to choose what opportunities to share three-way.
  • Equipping solution sales leads with the best of all partners’ alliance management tools.
    The systems integrator’s culture and tools, geared for complex, peer-to-peer, multi platform solutions and alliances, are more suitable to the most complex deals; the platform vendor has  simpler, more concrete, one-way channel management methods that help all partners provide repeatable mutual support in simple cases.
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