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Distribution : 10 tips for the evolution towards the Cloud


Making the transition towards the Cloud will be an obligatory step for many distribution players. What advice can you give your partners to help them in their evolution towards the Cloud?
Here are 10 tips:


Distribution : 10 tips for the evolution towards the Cloud
1 -Advise your partners to use the Cloud themselves 
All resellers have printers, PCs, networks, phones…But how many of them use the Cloud? How can they hope to make their clients understand the benefits of the Cloud if they haven’t made the change themselves? 

2- It has to be a strategic decision 
The decision to distribute Cloud offerings cannot be made by sales or IT management alone. It is a strategic decision which will have an impact on the partner's balance sheet, cash flow and the way the company is organised. Thinking that it is purely a commercial decision would be a fatal flaw.  It has to be a strategic decision.

3- Partners should evaluate their organisation and its current business model
There’s no point in wanting to change the impossible. If, despite managements’ vision and enthusiasm, the partners’ teams dig their heels in to stop any change, they will be doomed to failure. Advise your partners to consider the other possible options such as creating an association or a spin off (the creation of a specific entity with its own team). If the change requires traditional financing it may be better to isolate it from their current balance sheet, because mixing types of financing may confuse the bankers.

4- Help your partners examine all the opportunities available to them
Reselling recurrent services (Cloud, SaaS, Managed Services) brings both opportunities and constraints, but partners often tend to forget the opportunities and only see the constraints. The new services your partners will be able to promote are just some of the often overlooked opportunities. Other opportunities cited by active Cloud partners include: accompanying clients in their migration and extending the range of managed services provided (network management, security, storage brokerage…)

5- Partners may have to adapt the remuneration model of their sales force
The resale of recurrent services (Cloud, SaaS, Managed services) cannot be managed in the same way as sales in project mode. If your partners don’t have much recurrent contractual work in their activity their commission model probably won’t be adapted to it. They will have to change their remuneration model to compensate the fact that their instantaneous cash flow will decrease and that the « hunters » in their sales team will generally want to be paid at the time of the sale. This will have to be taken into consideration when determining what is needed in terms of working capital.
 

Distribution : 10 tips for the evolution towards the Cloud

6-Advise your partners not to be too technical. They need to think more in terms of value of usage and of reassuring clients about security aspects
The less one talks about the technical side of things the easier it is to sell Cloud services. Partners need to bear in mind that for a client the Cloud isn’t revolutionary, it’s just an evolution. Using software on one’s PC or via internet isn’t life-changing, but it is life-enhancing. Your partners should insist on the daily benefits whilst providing a message that alleviates any objections related to security issues.

7-Partners should multiply the number of contacts they have at client companies
They should not focus on just the CIO, but think of the more operational management positions.
Often partners say that they don’t have enough requests for the Cloud, but these are the same partners that are mainly addressing the CIOs, whilst the demand for the Cloud comes from the more operational positions. In some instances the CIO may even be a hurdle to the development of the Cloud. Ideally partners need to ensure they can meet the needs of client operations management, whilst respecting any technical constraints made by the CIO.

8-Partners should avoid becoming Cloud extremist
Hybrid solutions are the most developed today. Your partners’ advisory role will be a determining factor for you, if they can suggest the most appropriate solution in terms of their clients’ objectives and desired level of security.

9-Their service should be organised  to make renewal a priority
Your partners will learn how to monitor their « Churn rate », that is the percentage of clients that have abandoned them in a given period. The aim: to create customer loyalty. The means available: the partners’ teams, client support, active marketing, the community, social media…By helping your partners to become  specialists you will help them to measure the rate of abandonment, (return to an on premises technology), the rate of voluntary attrition (leaving for a competitor) or of involuntary attrition (client company closure or merger).

10-Partners should be able to share information and not feel that they have to go it alone
Remember your partners will be exploring new territory and mistakes will be expensive – very expensive! Exchanging with others who have already taken the same route will save them precious time. Focusing on suppliers of the Cloud, SaaS or managed services that have a real support offering can often be more valuable than an attractive discount. 

 

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