Software Hairballs, False Cloud Present Pitfalls for the Channel

Businesses once wary of cloud computing are increasingly migrating their critical applications to this dynamic environment and that has forced a dramatic change for the channel industry.

As customers and prospects have come to expect to find everything in the cloud, Value Added Resellers (VARs) are beginning to understand that they must ‘adapt or die.’ Many we talk to report overwhelming demand for cloud services. But exactly how can VARs maximise their profits in the cloud era? With so many options in the marketplace, it’s not surprising that many find it difficult to choose solutions to adopt and resell. To point you the right direction, this two-part blog post gives you a look at the keys to propel you to channel success in the cloud.

Beware of the fake cloud

Cloud technology has not only changed business practices, but seriously disrupted the vendor landscape. Many established software providers have still not caught up in this increasingly sophisticated market. In fact, there have been many cases where major vendors have flat out failed to break into the cloud market -- far from comforting for associated channel partners.

It’s important to make the distinction between a true cloud solution and a hosted service with a ‘cloud’ label slapped on it. While on the surface these cloud-washed solutions may seem like a good value, their shortcomings will be quickly exposed by a savvy customer. Don’t be fooled by vendors that have merely gobbled up Independent Software Vendors (ISVs) as a means to ‘buy’ a user base or simply to keep them out the hands of rivals. Applications within these so-called cloud solutions are often discreet point solutions overlapping a vendor’s own capabilities that integrate poorly with other essential apps.

Avoid software hairballs

A true cloud solution must be a real-time, multi-tenant, single source application, with unlimited access from any web device. Customers must never be required to manage upgrades or infrastructure. Very few cloud companies today can offer this, especially for complex systems that operate an entire business on a single application. Trying to tie together numerous, disparate technologies into a central system may earn consultancy fees in the short-term, but ultimately leads to a software hairball on which your customers will eventually choke! Avoid overlapping solutions that don’t fully satisfy client demands and find a vendor you can trust to offer a complete, comprehensive and integrated solution.

Trust plays a key part in any partnership. The dramatic change in payment models of replacing capital expenditure in favour of operational brought about by the cloud has necessitated a move away from some resellers’ previous love ‘em’ and leave ‘em’ approach characterised by large one-off sales. Resellers now play a more supportive role offering customers a long-term solution. With this in mind, look for a vendor offering a platform with stability, support, long-term investment and growth potential. 

For part two of this blog post, I will lay out the importance of vertical specialty and having close relations with your partner in achieving cloud channel success. Tune in next week!

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-Mark Troselj, VP and Managing Director of Asia Pacific and Japan for NetSuite

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