Connect2Deliver Blog

The Word for the Day: VALUE

The Word for the Day:  VALUE

Carol Blanchar, M.S., CEO, Conexo

 

Value is just being defined for  current Cloud solution vendors and channels.  The new technology is a fundamental shift in solution architecture that profoundly changes price-performance and investment decisions for business buyers and consumers.   Emerging cloud infrastructure and platform services are increasingly easy to customize and scale for specific markets without repurchase or much delay, and can also be adapted going forward based on experience and business results.  However, they do require technical skills and experience with a wide variety of integration, linking, security, testing, monitoring, diagnostics , and vendor coordination. 

 

Based on their trusted relationships and deep knowledge of a target market, channel partners help their customers buy cloud solutions and services, selling and recommending  emerging cloud solutions.   They also guide solution design and technology development - vendors plan product strategy through broad surveys of channel experience about  customer need and market demand. 

 

This is an uncertain business.  We are going through a huge transformation in how IT investments are analyzed and budgeted, changing how IT departments  and the businesses they serve,  purchase technology.   At the same time, business IT vendors, partners, distributors, service providers, and resellers are redefining their own roles in sales, delivery,  and implementation.   Many are moving to increased. ongoing participation in IT operations, administration, and management -  business models across the channels at all levels are driving to recurring revenue streams that better map to cloud service costs and value delivery.

 

Far beyond using just service consumption and cost-of-ownership as a basis for investment decisions,  many now believe that pulling IT into better alignment with Line of Business value and metrics makes it an effective business enabler, even adding leverage for increasing business agility and growth.  The benefits of cloud infrastructures and platforms, when applied to key business initiatives rather than cost-cutting efforts, offers huge payback on a scale never possible before now. 

 

Value is the only variable in the business model that translates directly into market share growth, profit, or positive cash flow.   Most importantly, the entire delivery chain architecture of business IT depends, not on IT department success, but on the end line-of-business success which drives profit and growth back up the chain to the vendors with real dollars –  only the end business gets the dollar that buys groceries and makes payroll and pays for services back across the entire delivery chain – sustainable economic growth comes from performance by the last business, on whom all else depends.. 

 

Value quantifies what that end business consumer wants to pay good money for.  Every player in the IT services delivery chain bears responsibility for defining their own value contribution to end consumer / user success.   

 

The biggest hurdle is the disconnect between business value drivers and the way IT has been managed until now.  Business managers and teams still view IT charges as purely overhead administrative cost, a resented burden to be constantly decreased as much as possible, disconnected with their own value proposition and competitive success and business survival.   So, an immediate contribution of cloud computing to economic growth is in related conferences, professional organizations forums, sales and solution planning, and shared experiences, as people are gaining clarity and rigor around roles and business models, refining cost and pricing structures, and demanding evidence of real value based on solid business results.

 

Most important are futures of all the IT technical people who are essential to always-on, high-availability ecosystems.  Their ranks are thinning, but they must provide the expert knowledge and skill to realize the potential of emerging cloud-based business and go-to-market models.    Cloud services offer new value that justifies the retention and training of in-house and channel staff to match and manage service choices to points of greatest business impact and optimum results.  With them, we can deliver the cloud-based information systems that make us all far more valuable!

 

Word for the Day: TRANSFORMATION

The Word for the Day:  TRANSFORMATION

Carol Blanchar, M.S., CEO, Conexo

 

I’ve been spending most of each day on market research into the IT business sector, and it is fascinating!  All my professional life has been spent in an orderly IT market, and look at it now – it’s not blowing up or falling apart, just fading and moving around, like shape-shifters – everyone COULD be a number of things, none of them really defined, and all them so much more efficient, flexible, and cheaper that simply doing nothing is not an option.  Actually, a business soon won’t be purchasing with quarterly cycles, long-term agreements, big capital outlays, lock-in Service Level Agreements.   Selling and buying information technology is in transformation, it is becoming FLUID. 

 

Does this kind of fluid information technology market sound like something you’d want to invest in or bet on?  Maybe not so much.   Does it sound like an approach to business IT that you’d like to TRY and CHANGE when you want?  Absolutely!   So, in spite of the uncertain business models, the  entire industry is moving very quickly to cloud infrastructure services, that can be used to support cloud platform solutions, that can be used to support cloud software for end users / consumers. 

 

The biggest bump in the road of transformation to this huge new marketplace is the investment question – when and how will investors organize something so cloudy?  And there is also the scarcity of people for service development, sales, integration, and management, who have to get hired, trained.  No doubt innovative new ways will emerge for investing and sourcing and talent management.  

 

This transformation is the opposite of most current strategic planning and execution – it’s business strategy distilled and refined from collective, intentional, collective experience,  on the go. 

 

Imagine the old high mountain climbing business - it was mature, followed known routes, with big teams on long climbs supported by lots and lots of carriers and supplies.  Failure to reach a climbing goal was blamed on poor planning or lack of funds or leadership or the weather – and once a plan was chosen and investment funds spent, it got harder and harder to change plans once the team was underway.  Suddenly now there is new equipment and rapid climbing techniques.   People take off in groups of one or two – they may take the old route up a mountain or another path entirely, charging into the death zone willy-nilly, making videos, bragging to everybody and sending constant blogs, wiring themselves with helmet cams so that their friends can “go” with them real time, tagging the summit and getting back down in days not weeks and months, using little (but obviously better) equipment, sometimes dying or letting others die as they charge pass – then trying it all blind or with one leg, or on skis  or using parasails – and when they get home they publish their e-book and shop the movie rights.  Hundreds now summit  the giant peaks every year, not dozens.  Thousands go to play and just have the adventure, even though most never summit.  Wait – WHAT????

 

What has happened to the entry barriers for climbers / competitors?  It used to take years to muster the funding for a climbing expedition, and only the most daring would succeed.  Today, climbers who face the same challenges travel lightly and cheaply and fast, and they often don’t buy their equipment – they just advertise the brand on their real-time videos and web sites and blogs.  In the future they can just promise to use Comcast or Amazon or Disney or Microsoft as their Service Provider in exchange for sponsorship – and the service provider itself will be using the climbs to open up  and serve new service markets in Tibet / China and worldwide.  And think about what’s happening to mountain climbing equipment vendors?  Big growth, no longer pushed by expensive, big REI retail outlets but pulled from on-line demand in response to the latest news.   And what’s happening to the service providers / carriers?  They find themselves quickly becoming content enablers, brokers, and part owners of great stories and footage and advertising opportunities, with constantly evolving new revenue streams.

 

Enterprise, services, technology, vendors, channels, businesses, users – all the conferences, blogs, seminars, and publications – what an exciting moment in the journey that began here in the Valley not so very long ago.  Great people, wonderful ideas, new  businesses, unbelievable speed.   Transformation.

 

 

The Word for the Day: CLOUD

The Word for the Day: CLOUD

Carol Blanchar, M.S., CEO, Conexo

 

Tomorrow morning I head off to Cloud Connect 2012, here at the Santa Clara Technology Center. 

 

The Cloud has emerged slowly as a Conference focus here in the Silicon Valley.  It began as a mere thread in speaker presentations (each presentation had one slide titled “What is a Cloud?”), then became a kind of hype in session descriptions or names (everything used the word “Cloud”).  Only recently did the Cloud have enough real content and investment to qualify as a whole Track, and now, the Cloud has its own Conference.  The same Conference will be in India in May, and Chicago in September.

 

The unifying focus of Cloud Connect next week is the formation of cloud business and market strategy, to make it less, well, CLOUDY.  This is really urgent, because although the technology is still evolving and product specifications, prices, and related services are still being defined, the demand for game-changing price/performance improvements, help with data volumes, and always-on access for all business users is overwhelming  our legacy systems. 

 

Meanwhile, IT managers know that business users and business managers are taking matters into their own hands, moving rapidly into the cloud for business technology, happily signing up for parallel software-as-a-service solutions that work on their notebooks, tablets, and phones.  Some Lines of Business and functional teams go further – they take advantage of a development platform underneath their directly-purchased cloud application – they adapt, integrate, and meet their  business needs in weeks, not years.  In that way, they can move fast enough, with small investment and little risk, to survive and grow in their fiercely competitive markets.

 

Anyway, back to the Cloud Conference this week!  Since registering, we have received links to details about keynote speeches, sessions, workshops, and exhibitors, been  given ways to invite colleagues and codes for discounts and passes.  We have profiles to help us find and connect with each other online if there are people to meet or follow up during the week, and we have the code to a mobile app that works with Apple, Android, and Mobile app platforms.  We are ready and poised on the brink of the next 4 days – and it’s going to be GREAT!

 

For people who cannot travel or take the time off, missing the in-person conversations and shared learning, they can still watch speakers live or see videos online, for free, and download copies of the presentations – you can also get personal contact information for presenters and to people in the exhibition booths.   

 

So, here with we are with a nearly impossible gap to close, already behind the curve burdened by huge uncertainties.  The Cloud Conference is trying to frame a strategy for infrastructure, platforms, and applications.  We will work together to reassure each other  and our investors, and to reach collective clarity about business customer and end consumer needs.  Where are they today, where do they need to be, and how will they get there? 

 

What are the odds in favor of a successful and productive Cloud Conference?  Huge- because of the cloud! 

 

The San Jose Technology Center is wired with great infrastructure and tech support, kind of Conferences-as-a- Service to participants and the public, much of it relying on platforms and services in the cloud.  Lasting value is provided by live feeds, data access, file uploads and downloads, contacts and connections between people based on profiles, connections to speakers, resource links, security and access management, blogs, comments / feedback by session, and published materials that changes constantly.  So here we go, not once but three times in three different locations, to Asia and back.  It’s a wonderful world!

 

Channel partners in the sales, delivery, and support of business solutions have also begun working together in new and innovative ways to meet their customer needs and develop sustainable new business models.  Vendors, distributors, Managed Service Providers, and Value-Added-Resellers are developing new technical services for education, training, new partner and customer agreements, cross-company coordination, and problem resolution.  At the same time, cloud technology vendors work together to balance near term deployment with later build-outs, flexibility with simplicity, and vendor innovation with connectivity and reliability.

 

In fact, we observe that some transformative channel players are going quickly to market by using high-availability cloud services just as we see at the Cloud Conference.  Even more, they are defining this kind of coordinative, integrative management service as an new set of service products in a recurring revenue business model.   (By the way, the Cloud Conference could provide something similar for its own community if it wanted, at very low cost – we would register for a conference and an ongoing subscription to maintain connections and continue to share and learn together.)

 

So there you have it - the disruptive, transformative Cloud business, that could be stalled by emerging technology and business models, is instead coming to market at incredible speed by using the Cloud!   The work of defining cloud markets  is moving forward by itself tapping into cloud services to be fast, flexible, connected, and responsive.    Cheers for that amazing, mystical Cloud!

The Word for the Day: MANAGED

The Word for the Day:  MANAGED

Carol Blanchar, M.S., CEO, Conexo

 

The Managed Service Provider (MSP)  has long been  an key player in technology solution channels . Often invisible to the end business or consumer, the Managed Service Provider offers expertise, relief, and safety to VAR’s and IT departments.   It drives down operational costs and combines purchases for lower prices, and shields the in-house staff from painful  hiring and firing cycles. 

 

A managed service implies that the service user is shielded from technical complexity, integration issues,  vendor upgrades, problem resolution, outages – most of all, managed has meant anxiety relief.     

 

With their place in the sales and delivery channel,  Managed Service Providers have been key players in the go-to-market strategy for technology vendors and distributors.  They are a pathway to gaining more share of the mammoth small and mid-sized business information technology spending budgets, and are themselves significant purchasers of technical solutions, including service and support.

 

Today, in the brave new world of the cloud, MANAGED means more – managed means money. 

 

Emerging managed services are enabled by cloud technology in the same way that cloud solutions are enabled by virtualization.  At the same time, managed services help solve two barriers that limit the growth rate and profitability of the emerging cloud markets :  technology changes and business model changes.

 

Technology changes extend current cloud investment and risk beyond the initial point of purchase.  A close look at current cloud architecture elements – servers, networks, and storage – shows their vulnerability to ongoing upgrades and adaptation in their operating systems, configurations, utility and protocol versions, address and network management, and integration capabilities.  Technology will be changing constantly to solve problems, simplify solution offerings, automate support, and improve performance and security. 

 

Technology is also changing because of a fierce drive toward proprietary end-to-end cloud solutions from the vendors in the near term.   This is  not just because of a wish for customer loyalty with minimal churn, but also to incent and protect vendor investments in innovation and higher-risk solutions in high-availability and on-demand markets that are just begin to emerge and mature.

 

Business model changes from the cloud technologies are profound and disruptive.  Are you watching  the shifts  and repositioning  of technical service sales and delivery up and down the information technology channels, as companies search for market penetration, margin, customer loyalty, and sustainability?  Company by company, from vendors to the end business, cloud technology drives to a single winning business model of recurring revenue. 

 

So, if you want to sustain ongoing presence and value to the cloud technology consumer, offering uncertainty and risk from ongoing complexity – and at the same time incredible new savings, flexibility, and speed – you must go to market as some form of an ongoing Managed Service.    Some examples:  vendors provide ongoing delivery and upgrade support;  distributors partner with service providers to have lasting relationships downstream; Value-Added Resellers of all kinds stay alive by taking on their customer’s  IT services to end users; and IT departments that leave day-to-day operations to service providers while matching services to changing business and end user needs.   

 

Sometimes the business model change to recurring revenue is defined (especially by accountants) as simply a financial hat trick, a shift from capital spending to operational expense, but it is far more than that – it is an unstructured pattern of purchasing, not based on budget cycles or master business plans, but rather in response to critical line-of-business needs.  The purchasing will be a pull, not a push, based on end user and business opportunity and needs that appear in the product line or industry market.   

 

In the face of technology change, the Managed Service Provider offers a safe and orderly point of technology introduction and adoption.   Managed Service offerings provide a recurring revenue business model, integrating vendor solutions with ongoing planning, purchasing, integrating, upgrading, and deployment.  Finally, Managed Service Providers reorganize emerging cloud technology markets along customer-facing lines of value to specific verticals (i.e. medical, legal, manufacturing, government), regions (i.e. geographic or regulatory), or special circumstance (i.e. mergers/acquisitions, centralization)

 

So, here’s to the quiet channel player whose time has come!  Cloud solutions enable all technology - HW, SW, services – to be offered as ongoing services.  All technology solution vendors and partners, all the way to the end user, even internal  IT departments, are fast transforming into Service Providers - and the only service offerings that can survive and thrive in the face of profound technology and business model changes are Managed.