The only constant in life is change itself, and it looks like the channel is in for yet another change. The IT industry has always been a fast-paced arena, where VARs need to adapt and re-adapt to survive. But these are particularly interesting times, with an economic crisis tied to an energy crisis and an environmental crisis.
But it seems people are ready for change (well, maybe not so much in Canada, but at least in the U.S.) with the election of Barack Obama as president.
Change – even if it’s for the best – is never easy. People hold on to what’s tried and true, even if something better is out there. That’s always been the case with technology, which many people find overwhelming and try to avoid until they’re actually forced to deal with it.
This may be one of those times. The channel has already been forced to move from peddling products to selling solutions. Now, tough economic times could lead to bankruptcies, further consolidation and changing business models.
There’s been some bad news over the past week, such as AMD laying off 500 employees worldwide. Of concern to VARs is that IBM Global Financing has discontinued credit programs for solution providers – so this begs the question, will more cuts come from other third-party lenders, such as distributors?
But if distributors keep up their credit and other value-added programs, they’ll become an even more important partner. Because the need for technology isn’t going to disappear – companies are trying to cut costs by virtualizing their data centres, rolling out remote access strategies or streamlining their business processes to reduce power consumption.
And all of this requires technology. That isn’t going to change. But it may be the solutions themselves – and how they’re delivered – that’s going to change (in fact, many solution providers in the software-as-a-service business say they’re doing just fine right now).
So distributors have an opportunity to make themselves even more relevant to the channel, especially if vendors start pulling back support. Arrow ECS, for example, sent out a list of tips to help its partners during these tough economic times. VARs should know their customers’ total information technology spend – and budget cycle – and how a solution fits into that environment. Also, the distie recommends solutions with a short-term return-on-investment. No one’s looking for two-year ROI right now.
And, not surprisingly, Arrow recommends taking advantage of the resources offered by your value-added distributors – and it’s not bad advice. Doing it all yourself means increasing your cost structure, so why not use the technical and marketing resources that are already available to you? (Arrow has its MPower program for the midmarket, for example.)
And, if a project requires skills you don’t have, partner with your distributor or another VAR if necessary. Sure, we can’t predict the future, but we can focus on our strengths and partner where it makes sense. Because change is coming, whether we like it or not.