Part 1: What gives one VAR an edge over another?May 19th, 2008 by Heather Clancy
I’m sure it won’t shock you to hear that I was on yet another set of planes last week, this time winging my way to Chicago, where I gave a presentation at a dinner seminar hosted by Tech Target’s channel media organization. I was asked to talk about how a solution provider executive can create a more differentiated value proposition, one that will help his or her company stand out from the competition without putting the bottom line in jeopardy.
Here are some of the high-level observations I focused on during that talk. I’m actually going to focus on the business management ideas I shared, rather than the technology trends that I think are worth investigation. I’ll handle that in a separate entry. Happy to engage with anyone out there who’d like to discuss any of these issues in greater depth. Here goes:
- Talk Business Solutions, Not Products. Some of you have heard me preach about this for some time, and many of you call yourselves solution providers. But when you look deep within, can your sales team REALLY discuss the products you’re selling in a business context? There are several really good reasons to consider this approach: You will develop more strategic relationships with your customers (both inside and outside the IT department) and from a financial standpoint, you could see bigger deals, with higher margins. Oh, and you might EVEN be able to create some budget where none previously existed.
- Listen to Your Engineers. Obviously, these are the people who are closest to your customers on ongoing basis. Who better to pick up emerging trends or test your ideas? These are the people who provide a sanity check. You could formalize this process by putting in place some kind of system to reward valuable feedback.
- Select Vendors Selectively. I could write a whole blog about this one issue and I’ll probably do so in the near future but there are three “Cs” you should look at when evaluating a new vendor or focusing a lens on an existing relationship: Communications (what do they say about partners in their high-level branding messages and is the channel really acknowledged?); Compensation (how are you paid AND how is the vendor’s direct sales field organization incented to work with partners?); and Collaboration (how does the supplier engage at the field level on joint sales calls?)
- Partner Strategically. (Or, Test Before You Invest.) If you’re thinking about adding a new solution line but don’t have the technical skills yourself, consider teaming up with another company that does. This way you can test out whether the line extension you’re thinking about makes sense for your business without spending a lot of money beforehand. Make sure you set specific ground rules, though, especially when it comes to customer interaction and support.
- Brand Thyself, Not Just Your Product Suppliers. I’m still astonished by how few VARs have invested in marketing their own company, rather than just their vendors’ wares. By sitting back, assessing your solutions sales messages and then focusing on how to talk about them more simply and broadly, you can create buzz for yourself despite whether or not you have a particular vendor involved. THEN you can use those frameworks to help promote a particular product within that context. NOW is the time, also, to educate yourself about blogs and social networks. Both can be valuable tools for extending your message beyond your local business community.
- Finally, Think Long-Term. When I step back and think about how long it has taken for IP telephony and unified communications to really become a mainstream conversation, I am astonished. Taking on a new practice in an emerging technology requires a multi-year investment, one that will probably run at a loss initially. That’s why it’s important to assess exactly how far your company is willing to go to establish itself in that market and how other practices can be run more efficiently in order to help fund that investment. This will need the support and buy-in of everyone in the company, not just some skunkworks team. Three years seems to be the benchmark that many VARs use in making a transition like this.