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A new channel has emerged, but are you in it?

James Henderson | June 13, 2017
Non-traditional vendors and partners have established a beachhead in the market, threatening the status quo of the ecosystem.

"This phenomenon is also happening with accounting/CPA, legal and other industry-specific firms. Competition in this new world, and vendors partner ecosystems, are going to grow at least 5X in size, scope and complexity."

The ease of adoption of cloud SaaS is increasingly leading business unit managers to make cloud buying decisions independently of one another and independently of any central authority.

According to Gartner vice president and distinguished analyst Janelle Hill this approach reflects greater freedom of choice for these business units and may improve time to market.

However, it can seriously hamper combined value to the enterprise.

"Independent and uncoordinated journeys into cloud SaaS mean the goals, selection approach, initiation and ongoing implementation of services will be fragmented at best and siloed at worst," Hill said.

"A coordinated, service-centric approach has the advantage of enabling multiple business units
to benefit from joint decisions and shared support for all of the various SaaS solutions."

Consequently, by 2025, 55 per cent of large enterprises will successfully implement an all-in cloud SaaS strategy, with this transformation a very different world for the CIO, the IT organisation and the channel ecosystem.

SaaSification

In assessing the evolution of IT, Herbert cited three defining stages when assessing the evolution of IT - the mainframe era, the PC/Internet era, and the cloud/mobile era.

"There are many factors that define distinct eras, but the result is a new foundational platform that supports new tools and techniques," he explained. "Moving forward, new elements built from a cloud mind-set will play larger roles."

Naturally, the impact of cloud on the channel continues to be both immediate and profound, creating new partners, new product lines and new business models as a result.

"There's a natural progression from being focused on selling hardware infrastructure and building a hardware infrastructure 20-25 years ago to evolving to a software solution business and then finally building an application based on the IP that has been built over the years," Channel Partners CEO Greg Eckstein explained.

Billed as 'SaaSification', from the partner perspective, Eckstein said this entails the transformation of a value-added reseller with an on-premise model moving towards a cloud-focused subscription approach.

"While this is a natural progression I caution the channel," Eckstein warned. "What we see with the majority of the system integrators that are building apps, most of them are failing to get them to market.

"And I think that's because it's just a lack of understanding that it is a fundamentally different business model that requires a different organisational team and metrics to get those products to market successfully.

"Product companies need different roles and responsibilities to successfully get those products to market."

 

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