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Transform or Risk Extinction (Part Two): Recognizing Value in Multiple Engagement Models

Posted By Cynthia B. Hanson, Tuesday, May 22, 2018
Updated: Sunday, May 20, 2018

This is the second of two blogs continuing my April 2018 eSAM Plus article on “Architecting for Transformation: The Next Generation Partner Ecosystem,” the title of a lively conference session led by Russ Cobb, senior vice president, growth and business operations at SAS Institute, and Norma Watenpaugh, CSAP, founding principal, Phoenix Consulting Group. The two took the stage at the A2018 ASAP Global Alliance Summit, “Propelling Partnering for the On-Demand World: New Perspectives + Proven Practices for Collaborative Business,”March 26-28, 2018, in Fort Lauderdale, Florida, USA. The drivers of seismic changes in channel partnering, Cobb and Watenpaugh explain explained, are the convergence of SMAC (social media, mobile computing, analytics, and cloud technology), the change in technology consumption, the rise of digital transformation (DX), and the Internet of Things (IoT).

Part One of this blog post concluded on Watenpaugh’s comment, “There are no simple partner models anymore. They are adopting complex, multi-faceted business models where they do all of the above.” So how to recognize value across multiple engagement models?

Watenpaugh: Companies need to recognize value across multiple engagement models in the following ways:

  • Partner programs are evolving to recognize the breadth of contribution from partners across a blended business model.
  • Incentives shift to reward behavior and customer value.
  • Vendors can no longer subsidize profitability through rebates or discounts.
  • Recognizing value, investment, commitment, volume.

Cobb: SAS has a partner program that has a precious metals taxonomy as well. What we are trying to do is have more partners because of economics—if we can get a partner to look at different ways at engaging with SAS, such as the ability to resell SAS or engage in analytic services with a revenue-sharing agreement with SAS. We are really focused on economics because of customer behavior.  The more ways we can get engaged with you partner-wise, the more commitment you will get. The ROI will go up over time. One reason we get partners to do things with us is we create commitment over time.

Watenpaugh: The cloud strategy right now is evolving and emerging. We need a flexible view of what cloud means. We need to transition to a service model. How can we help our customers fit into third-party cloud environments? We’ve got to figure out how to meet our customers where their need might be. There is a complexity of applications. No one can do it alone, so we are seeing more partner-to-partner. There are so many specializations. No company has it all. It’s becoming more and more important to get from a pick list to what skills are needed to deliver.

Some people think it needs to be more like a blockchain model. That involves the challenge of finding new partners and finding how to engage to meet the needs of customers. Infrastructure companies are challenged, and finding the right value and provision in the cloud is really a challenge.

Russ: This all comes down to if you are a channel or IT partner, what is your unique value proposition? You need a very crisp value proposition. So what is the road ahead in ecosystem evolution?

  • Industry trends in cloud, digital transformation, and IoT are driving disruption and opportunity in the market
  • Non-traditional partners offering access to the line of business
  • Vendors will be required to think more holistically about the capabilities of the partner ecosystem
  • Vendors must create relevance to business outcomes or become commodities
  • Creating a compelling partner experience

Check out Part One of this blog post as well as the May 2018 issue of eSAM Plus for other topics addressed in Watenpaugh and Cobb’s session as well as ASAP Media’s coverage of other sessions at the 2018 ASAP Global Alliance Summit. 

Tags:  blockchain  business models  channel partnering  channel partners  Cloud  complex partnering  digital transformation  IoT  Norma Watenpaugh  partner ecosystem  partner models  Phoenix Consulting Group  Russ Cobb  SAS Institute  SMAC  value propositions  vendors 

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Partnering Strategies to Accelerate Growth in the Internet of Things

Posted By Norma Watenpaugh, CSAP | Phoenix Consulting Group, LLC | Founding Principal, Tuesday, May 26, 2015

For some time we’ve been hearing that Internet of Things is coming.   Well it’s here!

There are many examples that we probably don’t think much about.  Beyond our personal devices: smart phones, watches, Fitbits and all, there are a growing number of consumer appliances and industrial devices now connected into the network.  Do you own a NEST thermostat or smoke detector? On a larger scale, commercial and industrial buildings have networked their environmental, utility and security controls. The next progression is smart cities where all city assets are networked, monitored, and analyzed. This is just of the many applications of IOT that are evolving across many industries. By one estimate IOT will represent $14T of new value creation by 2020 with over 50-75 billion devices connected. 

At a recent Association of Strategic Alliance Professionals (ASAP) meeting, we heard different perspectives on the evolution of partner ecosystems creating this connected world.   IDC, an analyst company calls this convergence of technologies resulting in IOT, the third platform succeeding the first platform, the mainframe and the second platform, distributed computing.  The third platform consists of Social, Mobile, Analytics, and Cloud technologies, also known as SMAC.  

“The World has Changed, the Network has Not” asserted Mike Cuneo, Senior Director of Alliances at Brocade and one the ASAP panelists.  The Internet of Things with so many new devices and widespread data collection will create enormous demands on the network, on storage, on energy in fact the entire internet and computing infrastructure.  Mike also noted that we are not looking at merely one ecosystem of partners but many battling ecosystems providing different capabilities for different applications.  Much of this technology will be behind the scenes to the consumers of IOT, much like most of us don’t know where our electricity or water come from we just expect it to be there.  This will require a fundamental shift in the customer facing partners in the ecosystem.  The focus will be on the business conversation not the technology. 

Daniel Chang, Senior Director of Global Alliances at Salesforce spoke about how Salesforce is building an IOT platform and recruiting partners to develop IOT solutions. He used the example of how a connected washing machine might look to a consumer.  The manufacturer, using predictive analytics could monitor your machine and anticipate when there might be a breakdown, notify you while at the same time ordering the right parts and putting in the repair order. As with any big data conversation, this brings up the specter of privacy invasion. Do you want your home appliances spying on you? Some people might see this as a great warranty program and may even pay extra for the privilege of having their privacy invaded. Others may fear that here in California, your washing machine may rat you out for wasting water.   

Digital transformation driven by IOT technologies is on the agenda of every CEO according to Lisa Caswell, former CEO of eMeter and now an executive recruiter for Spenser Stuart.  But who owns this strategy?  Who is responsible for translating data and analytics into action?  How do you react to new business models that haven’t even been thought of yet?   There is no Chief of IOT. She remarked on the skills and talent landscape required to navigate this treacherous terrain.  It will require a pipeline of talent and remarkably, “the Alliance Manager is in the absolute best position to lead”. Some of the skills needed are: 

  • Ability to communicate complex concepts.
  • Having a customer orientation, keeping focus on the customer experience
  • Agility and adaptability, continuously learning, willing to take risks and enter ambiguous areas
  • Focus on contingency planning (things will go wrong)
  • Ability to lead cross-functional collaboration
  • Technical literacy, understanding value drivers, aware of cyber security issues

Lisa also advocates a cultural assessment for companies heading into this transformation.  Culture can inhibit or propel a company’s progress into this new world.  The successful culture will have less emphasis on authority and more on partnering and often partnering in the most unlikely of places.  

How does this all play out in the channel?  Sam Coyl, the CEO of Netrepid, a cloud service provider, has successfully transitioned his company from providing on-premise computing to cloud.  His data center is highly commoditized. He views hardware as expendables. His focus in providing reliable, on-demand, secure computing resources to his customers. Service providers should be asking customers how they access data and applications. What devices do they use? It is all about how they consume computing.  What does he look for in technology partners?  He looks at how well they have moved to support a consumption model.  There has been a shift in the channel and partner relationships from the large scale sale to a recurring revenue model.   This impacts business models, compensation models and incentives. 

Summary: With so much new opportunity  and the high risks of doing nothing, the savvy partner manager will step up to lead in this new future, forging new ecosystems that will position their companies to thrive in the Internet of Everything!

Tags:  Barcode  Daniel Chang  Fitbits  Internet of Things  IOT  Lisa Caswell  Mike Cuneo  Netrepid  salesforce.com  Sam Coyl  SMAC  smart phones  watches 

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New England Chapter Event Discusses Alliance Management amidst Disruption: ‘You’ve Got to Be Strategic, You’ve Got to Be Entrepreneurial, You’ve Got to Be Adaptable’

Posted By John W. DeWitt, Wednesday, November 12, 2014

Moderator Jan Twombly, president of The Rhythm of Business, introduced the panelists last Wednesday night, Nov. 5, as ASAP’s New England Chapter convened at the Verizon Innovation Center in Waltham, Mass. USA: Petra Sansom, head of alliance management, Genzyme; Alyssa Rosinski, global business development director, IAPP (International Association of Privacy Professionals); Kathy Faigen, Certified Client Executive, IBM; and Tony DeSpirito, VP, Global Alliances—IT Partners, Schneider Electric.

 

Twombly’s vivid opening slide—two planets in collision—acknowledged the challenging context of the evening’s topic, “Alliance Management in an Age of Disruption: Today’s Critical Partnering Success Factors.” Twombly then flashed four percentages on the screen: 92% … 68% … 42% … and 53%.

 

“Recent studies say 92% of chief marketing officers are looking to partner to get closer to customers and better understand them,” Twombly explained. “68% of chief information officers are partnering to bring additional capability to their organization,” she continued, noting that IBM studies are the source for these two data points. “42% represents CEOs in last year’s PwC survey who said they were going to enter into a significant strategic alliance within the next year.”

 

Finally, 53% represents that very familiar data point for anyone involved in alliance management—the virtually unchanged success rate for strategic alliances despite the proliferation of alliances and alliance management practice across most industries. “It is so clear that alliance management has to step up its game as partnering proliferates,” Twombly said. With her final slide, she asked her panel of expert practitioners, “So what’s changing for alliance managers—do the fundamentals still apply or do they need to change as our businesses change?”

 

Panelists then dived into the discussion—bringing diverse perspectives to an exploration of why alliance management matters more than ever today, yet must adapt if partner success rates are to improve.  Tony DeSpirito discussed how Schneider Electric—confronted with major disruption around the internet of things—moved beyond its stodgy infrastructure company heritage, recognized that it lacked many capabilities, and embraced partnering across both its traditional and emerging business lines. IBM’s Kathy Faigen discussed how her company developed a coherent approach to the disruptive technologies of SMAC (social, mobile, analytics, and cloud) while honing in on the crucial role of engagement, with customers and other constituents, in allowing businesses to successfully embrace unrelenting waves of change. Petra Sansom shared with the audience how Genzyme, a powerhouse biotechnology company now owned by Sanofi, is evolving its partnering strategy as it, and the biotechnology and pharmaceutical industry overall, grapple with pricing pressure from all around the world.

 

Alyssa Rosinski rounded out the discussion with her organization’s interesting lens on disruption. Privacy challenges are exploding thanks to ubiquitous connection, mobile device proliferation, whistleblower disclosures (think Edward Snowden) and correspondingly magnified risks of exposure that companies of all types now face when handling personally identifiable information, she explained. In the face of this challenge, over just the past few years, IAPP membership has grown from 8,000 to more than 20,000.

 

When partnering amidst disruption, DeSpirito said, it’s vitally important to ensure that your partnering is tied to overall strategy—and to do that requires a strategic review of the portfolio, making sure you’ve got the right partners aligned to your company strategy . Faigen talked about the critical importance of ensuring you’ve got the right value proposition for your customer as well as for the partners. It’s never been more important to rethink, to relook at it, and make sure the value proposition remains relevant, she explained.  

 

Wednesday night’s panelists also talked about importance of governance and metrics.

 

“That can be harder to do amidst disruption, because people are so crazily busy, so it’s hard to make the time to plan, to evaluate, it can be hard to think beyond the current crisis or meeting the current quarter’s numbers,” Twombly noted. “I think some of it is a maturing of the alliance capability, where people are recognizing the importance of having good governance. In biopharma, governance is in the contract but that’s not always the case in other industries.”

 

The final question of the night went to Alyssa Rosinski. Asked what quality or skill she is finding essential, she said that adaptability is at the top of her list.

 

Adaptability is, not surprisingly, crucial for alliance managers, who must “understand your partners’ needs, understand what your organization needs, understand what the customer needs, and be flexible and adaptable about how you’re going to get your result,” Twombly said in summarizing the discussion.

 

“In other words, you’ve got to be strategic, you’ve got to be entrepreneurial, you’ve got to be the expert,” she said. “You’re the one who needs to know everything about your partner, to represent the partner within your company, and everything about your company, to represent it to the partner. You’re the only one who has that big picture view, and that’s part of the expectations of senior management today.”

Tags:  alliance management  Alyssa Rosinski  ASAP’s New England Chapter  biopharma  disruption  Genzyme  governance  IAPP  IBM  Jan Twombly  Kathy Faigen  Petra Sansom  Schneider Electric  SMAC  The Rhythm of Business  Tony DeSpirito  Verizon Innovation Center 

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