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Known as the horse capital of the world, Lexington is the second largest city in Kentucky and is the proud home of the Kentucky bourbon trail.  It’s also where technology experts, Software Information Systems’ (SIS) roots were firmly planted with the goal of supporting their customers with the skills and tools to embrace the rapid technology evolution.  SIS CEO and Executive Vice President of Sales, Steve and Pat Sigg, also father and son, take a nostalgic look back at the last 30+ years and explain why the company’s transition to an MSP business model was the biggest challenge they’ve faced.

The 1980’s v.s. now – how different does your business look?

It’s changed drastically but given the very nature of the industry we’re in, it’s to be expected.  What drives our market is technology and the pace at which our customers embrace those technologies.  We started life in 1982 as a small custom application development company – particularly focused within the RPG space, writing code for what was back then, IBM’s AS400s before there was an off the shelf package that could deliver this.

Through the 90s, we became an IBM business partner, reselling their full portfolio of hardware, software and services products.  It was the mid-2000s where we underwent our biggest step change for the business as a result of our customers demanding that we diversify out of being just a ‘true blue’ IBM shop and look at supporting them with other types of technologies.  This meant us having to transition to a multi-vendor VAR, focused on offering a diverse range of best of breed technologies from multiple vendors including IBM, EMC, Cisco, Microsoft and VMware.  Back then, it was all about the data centre and adjacent technologies.

How significant is the cloud’s role today?

It’s all about cloud-based services.  We embarked upon our cloud strategy eight years ago due to the noticeable market shift which brought about the development and build of our first data centre in Lexington and an additional centre in Chicago and from there, we were able to launch our hosting capabilities.  This move also helped us to streamline our revenue which to date, had been centred around a model which drove big transactions – now it’s more consistent and reliable.  Today, we have a hybrid IT approach – that is on-premise, off-premise, public and private cloud solutions that we take to our customers.

What has been the biggest business challenge you’ve faced?

It has to be our transition to an MSP – for two reasons.   Firstly, we had to fund this change in our business model through our working capital which inevitably, placed immense pressure on the business.  But also, this was a huge cultural shift for the business.  The transition and continual support of our customers from VAR to MSP is a very different sales cycle and customer relationship.  Not only is the sales cycle more challenging due to the change in business model of the customer’s IT operations, but the customer relationship becomes much more involved as we have many more daily touch points and responsibilities in order to ensure we provide them exceptional support and service.  Making this transition from the VAR model is challenging but also really rewarding for both our customers and us.

What are the most important attributes MSPs need to have to remain relevant and profitable?

I would say agility and tenacity.  Agility because you need to be able to respond and evolve quickly to changing requirements – not just from the customer perspective but also the industry as a whole.  We always need to be one step ahead of the competition and the more agile you are as a business, the more likely you are to be able to achieve this.  It’s also one of the reasons why the Predatar offering was so attractive as it was all about helping us to evolve as a business quickly.  Tenacity is also important – when making a fundamental change to your business model, you need to have a long-term view and patience is key.  You can’t climb Mount Everest in one day.

What role has Predatar played in helping you transition to an MSP?

Predatar has most certainly helped us bridge a significant gap in our ability to offer our customers a truly value-added data availability as a service when it comes to disaster recovery, back-up and recovery and the data management and monitoring required to help optimise performance.  Predatar is multi-tenant and by far, the most versatile and easy to use solution out there today.  The great thing about the solution is that it has been built by the channel for the channel.  When we were looking to develop our multi-tenant cloud solutions, we knew that we needed to create new products fast.  This meant new delivery models and processes – the Predatar framework enabled us to build a service architecture and the fact that it’s all centred around rapid evolution, it reduced our time to market for our ‘Tru’ portfolio of solutions such as TruBACKUP – an important factor in the hyper competitive market we operate in.

The platform has also empowered our people.  By automating the repetitive tasks and helping to take care of monitoring, alerting and reporting processes, it has not only improved employee and customer retention, it’s allowed our team more time to focus on delivering outstanding customer service.  And, we can do this because the platform is always ‘learning’.  Through data driven insights, including deep learning AI, it’s enabling us to understand our customers better and become experts which in turn, increases customer satisfaction.

Not only does Predatar provide that speed, it also provides us with the ability to scale our service in a profitable way as more customers come on board.  It does this by eliminating silos across the business.  Managing a growing number of contracts where we need to track customer usage and billing, as well as continuously record time and effort can all become headaches.  By connecting different business functions, i.e. back office, sales, service and support functions, Predatar eliminates those problems providing us with the best possible opportunity to maximise revenue and avoid missed payments.

Jeremy Brovage, SIS Solutions Architect adds: “It’s also the closest solution customers can get to having their very own dedicated AI consultant – the platform is continuously watching and analysing the systems and carrying out health checks to help improve data backup quality.   Having this as part of our portfolio means that our customers can feel confident that their backup environment is being taken care of and they don’t have to worry, allowing them to focus on carrying out higher value functionalities for their business.”

What does the future hold for SIS? 

For us, it’s all about a Hybrid IT approach.  Our customers are really embracing the cloud – faster than we ever thought they would.  Although we still have our traditional VAR business which is still alive and well, we’re complimenting this with all of the new technologies available – we have to adapt, otherwise we’ll be obsolete in the next 5-10 years.  Every application has an ideal place to live and we need to help our customers get there, ensuring that we’re always focused on delivering that value add.

In 1897 Mark Twain reportedly said, “the rumours of my death have been greatly exaggerated”. Today, there are certainly many commentators on social media platforms who like to preach a similar fate for salespeople.

It is they who I think are the snake-oil salesmen of today. Usually for their own pecuniary gain, they peddle the latest cure to avoid having to learn the art of professional salesmanship.

Yet, there is something rotten in the state of selling today. CRN’s annual IT VAR report shows average earnings falling for a second consecutive year to just 3.4%. This, for the biggest 100 companies, the 1%, the cream of the crop. If company margins continue to fall, the average tech salesperson is going to see their own take-home pay go into reverse. How can we avoid this happening?

Predicting the future can be an embarrassing exercise. Unlike Bill Gates, who in 2002 said “five years from now, the windows tablet will be the most popular form of PC”, I don’t have the resources or the time to make erudite predictions. I do believe however, that salespeople will continue to flourish for many years but only if they adapt to what’s happening around them.

Why are margins falling?

When I started my career in IT sales, customers learned about products from people like me. Knowing my stuff, coupled with a dose of emotional intelligence, would ensure success if I worked harder and faster than my competition. Simply making more calls would guarantee an increase in my salary.

But today, empowered customers approach suppliers armed with certainty about their own needs, what technology is available, and what they are willing to pay. Faced with this scenario, salespeople have little left to negotiate but price. Perfect knowledge and unlimited choice make odd bedfellows with profit margin.

In addition, companies are experiencing longer sales cycles, lower conversion rates and less reliable forecasts.

What’s the answer?

One of my favourite proverbs is “empty vessels make the most noise”. About 10 years ago, the inbound marketing movement promised to empower downtrodden IT marketing executives. For salespeople, it promised an end to telephone prospecting. Suddenly, the social media feeds and inboxes of IT buyers were drowning in content and yet, it’s made not the slightest difference in reversing the downward margin trend.

More traditional IT sales leaders looked to sales force automation as their silver bullet. Customer Relationship Management (CRM) would solve the problem but it simply became a tool for middle managers to monitor their sales teams. It didn’t fundamentally change the basic sales model of identifying the customer’s needs, sending a proposal and trying to close it before any of your competitors get a sniff. With the empowered customer, that model no longer works no matter how fast or efficiently you drive it.

Artificial Intelligence – friend or foe?

At a big tech conference last year, Marc Benioff of Salesforce was peddling Einstein, an AI infusion into his CRM platform. I’m not convinced. Here’s why?

The only way IT sales can cure its ills is to completely change the model. To earn more margin, you must give the customer greater insights; tell them something they don’t know. I call this “Disruptive Selling”. But how can you disrupt the thinking of the buyer?

I agree with Jeff Bezos who said, “there is no institution in the world that cannot be improved with machine learning”. In 2019, I predict we will see a move by IT salespeople not just to sell AI, but to use it to gain greater knowledge about their customers’ IT environments. Armed with this knowledge and bucketfuls of good judgement and creativity, disrupt the thought processes of customers, for mutual benefit.

That’s our mission at Predatar in 2019; to give our partner salespeople the tools to harvest greater insights and customer knowledge. The smart salespeople will grasp this opportunity with both hands, others will be like Napoleon Bonaparte when told about the new steam-powered ships.

“How, sir, would you make a ship sail against the wind and currents by lighting a bonfire under her deck? I pray you, excuse me, I have not the time to listen to such nonsense.”

The Predatar team would like to take this opportunity to wish every sales person in the IT channel a Happy Christmas and a very prosperous 2019.

The 1990’s was a decade that brought us tons of gadgets, baggy jeans, alcopops, bandanas and the Gallagher brothers, to name a few – not only was the World Wide Web starting to change our lives, we saw the dawn of a new era in the way we shopped and sourced information with the birth of eBay and Google.

It’s easy to get swallowed up in nostalgia and take a step back in time to an era that was jam packed with truly iconic musicians, movies, TV shows, games, toys, snacks and fashion trends.  But who or what has stood the test of time, evolving through the years and remaining relevant to this day?

Text messages

In 1992, Neil Papworth sent the world’s first ever message.  At the time, he was asked to develop a messaging service for Vodafone. The text message read “Merry Christmas” and was sent to Richard Jarvis, a director at Vodafone, who was enjoying his office Christmas party.  26 years later and SMS has become a lifestyle – according to the CTIA¹, in the U.S. alone, 6 billion SMS messages are sent daily – that’s a whopping 2.27 trillion every year!

Coldplay

Formed in 1996, Chris Martin and his fellow bandmates were an instant hit and with their heart-melting indie music, they quickly turned into the band that everyone worth their salt wanted to collaborate with.  With nearly 70 awards under their belt, they’ve shared the stage with a host of well-known musicians including Beyoncé, U2 and Kylie Minogue.

World Wide Web

It’s hard to think about life before the internet and, the fact that it’s not even 30 years old beggars belief.  1990 was the year that Tim Berners-Lee formally published his proposal and it only took him another year to launch the first ever web page.  In January this year there were a staggering 1.8 billion live websites!

Nintendo

Now, you’ll argue that this brand wasn’t launched in the 90’s – and of course, you’re right!  In fact, its roots trace back to the late 1800’s when it was originally founded to produce handmade hanafuda – Japanese playing cards.  The brand came into its own when it entered the video gaming world and the launch of the Nintendo 64 in 1996 set the brand on a course that is still very much alive and kicking today.  The little boy or girl in us can’t help but feel nostalgic when we think of being embroiled for hours in the adventures with the Super Mario Bros.

IBM

Now, we all know how much computers and the way we store things has rapidly changed over the years and yet, IBM has remained a constant throughout.  Take IBM Storage Protect – although it may have changed its name a few times along the way, it has been a perennial seller for the past 25 years.  Consistently featured in the Gartner top right magic quadrant, people continue to bet their businesses on the brand.

Classic, perennial brands and products such as these have one thing in common.  Quality!  Of course, a product can evolve throughout the years – maybe a change of name or a different design, but the fundamental concept or premise endures.  You don’t always have to be the latest and greatest to bring value to businesses or even society.  Let’s stop and celebrate these true classics that have stood the test of time and will no doubt continue to dominate for the next 25 years and beyond.

1 Cellular Telecommunications Industry Association

The big day is fast approaching. Your palms are starting to sweat, and the nerves are intensifying. You’ve not felt like this since the birth of your business.

It’s now time to launch your first service offering. The pure reseller days, when “name that product” was someone else’s responsibility are officially over.

The big question is: what do you call your new service?

Your first port of call is the trusted Thesaurus where you’re hoping to be inspired.  Or maybe, you go for a walk, or get high – anything to ignite that creative spark.

You convince yourself that the name isn’t that important and that it’s all about feeling the quality.  Instead, you’re left thinking: who am I trying to kid!

A strong, memorable name will help position your product or service. It provides you with the platform to inform your audience what it can do for them and what it stands for. Most importantly, it helps to differentiate you from the competition. It’s the first step, but only a step, in building a brand.

A recent baptism

When looking for a name for its new data availability service, the team at UK-based Predatar partner Silverstring, asked for my advice.  Establishing a foothold in an already crowded market was going to be no mean feat so we needed to think outside the box.  We focused on what was important to the clients which was centred around not just protecting their data, but helping them to get more value from the data. Cost reduction was also high on the list of requirements so all in all, a challenging brief. After much discussion with the creative juices well and truly flowing, we agreed on the name Alchemis Protect™, the concept of turning legacy data assets into liquid gold, whilst ensuring clients can sleep easy knowing their data is protected.

Here are my top 6 tips when naming your product or service:

1. Do you put your house name on the product?

That depends on whether you called your son “Junior” or “the third”. If you didn’t, we recommend originality unless your company does just one thing – then it’s ok.  It’s also important not to confuse company with product. People buy products and services first. If they like the product then they fall in love with the company, not the other way around.

2. Avoid similarity with existing products in your space.

Imitation is great if you want to be a “me 2” kind of brand and I’m sure your competition will be flattered.  This kind of approach only serves to reinforce the fact that someone else got their first so try not to ‘copy’.  Be different – don’t be afraid to step out of your comfort zone and go with something completely unique.

3. Avoid Abbreviations.

Unless you’re IBM, FBI or JFK. IBM could do it because they were already well known. JFK was not called JFK until after he became president. If your product is new, people need to know what it is. An abbreviated name won’t help.

4. Sound and length.

In the search to be descriptive, we first explore the written word so it’s easy to overlook how it will sound. Don’t worry, your salespeople will soon tell you if it sounds terrible. Names with too many syllables are also a no-no. Guess what happens next? It gets abbreviated.

5. Naming a service vs. naming a product.

People think about what a product is and does. For a service, try to focus on what it can do for your prospect. This requires you to think like a customer and ignore the oh-so-amazing patent you filed.  The focus needs to be on benefits.

6. Think Global.

Naming your service “Chicago Cloud Backup” is great if you want to dominate in that city but it won’t do anything for your sales effort in Europe.

Finally, your words must match reality. Don’t over promise with a name your operation can’t deliver on.

Good luck with the launch of your new service.

Happy name hunting!

In the future, for companies to have confidence in their backup systems, assistance from machines will be essential.

According to McAfee and Brynjolfsson¹, the likelihood of any job being automated can be understood by asking the 4Ds; is the job dull, dangerous, dirty or dear? Not sure about dirty or dangerous but people tell me Backup is dull, and it can be expensive to operate.

Our ability to keep pace is the problem. Keeping data protected is a growing challenge as the volume and variety of data increases. And if data is the new oil, it’s also becoming more of an imperative. Backup and Recovery best practices move slowly from company to company, often only when skilled engineers move jobs. In ecological terms this is the equivalent of DNA mutation through procreation; a very slow evolution.

New data points from IoT and the proliferation of cloud computing models all point to data protection becoming a bigger challenge. With increasing regulation and ever more sophisticated malware attacks, we need to accelerate this evolution to keep up in the data protection arms race. Hackers are using artificial intelligence (AI) techniques to steal your, or your customers’ data, it’s time you considered it too.

Applications of AI in Data Protection

Machine learning is different from regular programming. Rather than developers writing explicit code to perform some computation or task, a machine learning application can use the data to create models.

One use case exploited by the most successful service providers, is improving customer satisfaction. An AI powered customer service chatbot can support and scale business operations.

Predictive analytics can help answer the question of what will happen in the future based on what is happening now. This technology can be used to identify patterns of backup failures, helping predict when the next one will occur.

How to get the best from AI?

Architect your platform for learning

For the successful adoption of AI in data protection, we believe that the learning platform must be separated from the underlying applications. Developers must have access to the metadata, so they can ask the questions to turn dumb backup data into smart insights. Large enterprises typically use multiple backup tools, so having your AI platform out-of-band will also create more training data for machine learning.

Develop an open mindset

A requirement for the successful adoption of AI in data protection is a large ecosystem. We believe the service provider and channel community will create the future of AI innovation in data protection. Cloud service providers, as they scale, will turn to AI to solve the toughest problems in backup and recovery. The most successful AI platforms will need to embrace the channel ecosystem.

In the middle ages in London, England, merchants and craftsmen formed Livery companies to protect themselves and their customers. Highly skilled artisans, such as the Leather Sellers or Merchant Taylors, even though competitors, would band together to gain network effects. Today, despite a global communications revolution, clusters still exist. Hollywood is where movie makers congregate, Silicon Valley for tech start-ups, and in Oxfordshire, UK, there exists a hub for Formula One racing teams.

Applying the same logic to today’s worldwide digital age, just as economies prosper when trade is unrestricted, AI in data protection will flourish when companies provide open architectures; fostering innovation across a wide ecosystem.

What happens next?

Our final belief is that we will see AI being deployed to help vendors and consumers co-create more personalised and effective solutions. An out-of-band AI platform is a co-creation development platform; bringing the makers much more insight into how their products are actually used.

We expect to see in the coming years a new wave of innovation in data protection as AI bridges the knowledge gap between product manufacturers and their customers.

¹ Machine, Platform, Crowd: Harnessing our Digital Future by Andrew McAfee and Erik Brynjolfsson 2017

A Passion for Excellence

Empalis Consulting GmbH, based in Stuttgart, brings its deep expertise in IT infrastructure to businesses across Germany. With a rallying cry of “Perfektion geht nur gemeinsam” (Perfection only works together), the team has an attention to detail which is extraordinary, even by German standards.

Known for its breadth and depth of expertise in data storage and protection, the company has a loyal following; it regularly welcomes over fifty participants to its famous “Noon-to-Noon” storage briefings. I recently attended one of these briefings and was impressed by the level of engagement between host and delegates.

Searching for perfection requires constant innovation. This has led Empalis to design and develop a new product range, called Empalis Service Plus. The management team at Empalis realised, that despite having a large team of data protection specialists, they could not be with all their clients as often as they would like. Empalis Service Plus allows the team to provide a continuous delivery of exceptional customer service.

Data Protection is not a part-time gig

As the value of data to a business increases so does the responsibility of ensuring it is always available and protected. Threats, appearing from anywhere across the globe and at any hour, drove Empalis to find a better way to stay closer to their customers. Much closer than the eponymous bi-annual health check. This led them to design Empalis Service Plus, powered by Predatar.

As Markus Stumpf, Technical Operations Director of the Empalis Service Plus team, said; “our primary purpose is to provide confidence and peace of mind; to free the customer so they can focus on their core business.”

Empalis’ development of its tiered packages will place it in the vanguard of companies capable of responding to increasing cloud adoption, enabling it to on-board clients needing managed services very swiftly.

A 5-Star Service

Staff at Empalis can already see how customers are using Empalis Service Plus to improve service levels. Markus Stumpf sees increased customer engagement when using the new service. As one client recently said;

“we no longer see Empalis as an extended partner but as part of the team”.

Frequent flyers know that aircraft manufacturers have sophisticated telematics to constantly check the health of their fleet. This level of protection has contributed to the dramatic rise of air travel safety. For many businesses, data protection is also a life and death matter, which is why Empalis’ new product is nothing short of a revolution in customer care.  Customers know the Empalis team are constantly keeping an eye on their systems for any sign of trouble and applying their own telematics for greater insights.

Changing Cultures

In 2019 Empalis will celebrate its thirtieth anniversary. As well as having a loyal customer base, the company enjoys a strong sense of community within the organisation.

Empalis Service Plus is more than a new product. It is at the core of a new people strategy which prepares the business for the future. Its leaders recognise that whilst they have been the beating heart of the business for many years, a succession plan is essential to bring in new people with new ideas.

Especially in Germany, which is known for its tight labour market and ageing workforce, having more recruitment options is vital. Empalis Service Plus has allowed the company to hire engineers who are not prepared to travel and bring on new talent, whilst also increasing customer responsiveness.

Alina Mot, the recently promoted CEO of Empalis, had this to say;

“Empalis Service Plus has given our business a new direction and new sources of revenue, which makes the future very exciting.”

Empalis is not standing still. The new CEO is navigating the transition from traditional consulting to modern service delivery.

The Predatar team are proud to support this programme to help ensure the company remains highly relevant, for many years to come.

For the original value-added resellers, professional services were a means to sell more product. In some cases, product-attach services were even given away to facilitate closing large infrastructure deals. The customer was saying, “look, you want to sell us this stuff, so you should be here when it arrives. Oh and while your here you can install it”. The margin was in the resale of the product, so it was the equivalent of a car salesman throwing in a set of foot mats; a closing tactic.

As margins in product resale have declined, VARs have been on a journey to monetise their technical expertise. The journey started with professional services and progressed to managed services in a bid to build recurring income. Whenever business models change, there are unintended consequences. These require board-level decisions about how best to structure and operate the business.

For example, if VARs want to place their star technical engineers into a profit centre, should that extend to charging for presales work? If the VAR is more reseller than service provider, should the presales fee be waived to help win a big deal? With the introduction of managed services what is their relationship with the professional services team? Who should own the primary contact with the customer?

Let’s look at four areas where the VAR must adapt to meet the challenge of becoming an MSP: Organisation Structure, HR, Billing and Scaling-Up.

Organisation Structure

Originally, technical engineers were aligned to the sales division as presales engineers. When services needed to be commercialised, a new and separate division was created, then another, just for managed services. Each division had its own incentives and goals, as well as different business tools to help them do their job. This division of labour was great for making everyone accountable but not so good for presenting a unified experience with the customer.

The general trend in the channel today is one towards a flattening hierarchy so that data and information about customers can be shared across the business. As revenues flow from product sales to managed services, technical teams may have the most customer touch points. When this happens, who should own the primary relationship with the customer?

The increasing adoption of SaaS computing models has seen a hollowing out of the sales function into new business functions. One team “lands” the deal while another, customer success, is responsible for on-boarding, adoption and renewal. As the VAR becomes more MSP-like, the model is less about product-attach services and more about long-term operational run.

Breaking down organisation silos is tough but imperative if you are to compete in a world of increasing automation and AI.

Services Billing

In the cloud era, especially in B2C, many services are free to the user. Subscribers who pay for a service certainly don’t expect to be charged for set up and configuration. In the B2B enterprise world, channel CEOs expect a return on highly-paid technical engineers, so they install professional services software to track their utilisation. Time must be accounted for, so every day is billed on a time and materials basis.

There is a customer backlash against this as they increasingly expect to be billed on value and outcomes, not time. More progressive channel players, confident in their capability, are turning to fixed price contracts. CSPs like Google and Amazon Web Services go one step further, they never mention the cost of labour. Their massive scale is achieved through automation, propelled by artificial intelligence and machine learning.

Like Uber, who could never control millions of taxi drivers with a room full of people armed with 2-way radios, IT services will be increasingly automated. Every successful company is now a technology company, regardless of industry.

The managed services model with outcome based, pay-as-you-use billing, is more aligned with the needs of customers who want to align IT expenditure with value and measurable ROI.

Scale and Efficiency

One of the great things about professional services is the amount of trust and understanding which can be built between the VAR and its customers. When a client feels confident you really know their environment they are less likely to shop around. In that regard, a great professional services team can build tight relationships and foster loyalty.

On the downside the people with both the technical and consulting skills are in high demand, causing wage inflation. Neither can they be everywhere at once and are most often placed on the highest producing accounts. As an organisation adds consulting resource, revenue can grow, but only linearly. Onsite visits build close links, but travel time limits the reach and efficiency of the team.

A managed service model is a different dynamic. The people who deliver the service are often remote which can make it hard to build such tight relationships. However, if modern communications can bridge the relationship divide, then the economic model for an MSP can be much more scalable. Shared resources, both people and infrastructure, help service providers achieve much greater economies of scale, as well as geographic reach. Revenues can grow exponentially.

Using this model MSPs and CSPs disrupt the status quo and put consult-heavy organisations at an economic disadvantage. Most of the world’s largest outsourcers are currently shedding staff.

Training and Human Resources

With employer demand for tech talent routinely outstripping supply, companies with ambitious growth plans need to pay attention to the most efficient organisation models. A growing managed service team requires multiple roles and can be a great training ground for new talent. Platforms which can capture knowledge and diffuse it around a team can really help to accelerate skills development.

Whilst professional services are often very bespoke, managed services are built on processes and platforms. The difference between a small pizza delivery business and Dominoes is the process used and process is driven by technology. If you want to scale your managed services business, you need to design the right process first.

It’s important to realise that the successful transformation from VAR to MSP requires executives to make decisions about organisational structure, business focus and revenue models. Predatar provides great software on which to build your managed services portfolio as well as consultancy to guide you through the transformation.

To find out more please drop us a line at info@predatar.com

When I travel I like to sample some of the local cuisine. Recently I was visiting the Philadelphia area on business and decided to fuel up with a Philly Cheese Steak. For those of you yet to sample this delicious treat, it is a sandwich made from thinly sliced pieces of beefsteak and melted cheese in a long hoagie roll. As the name suggests, it is a popular lunchtime food in Philadelphia; I found a restaurant on South Street which fitted the bill. The food was good.  It wasn’t exactly Michelin star dining, but the business operation behind the production and serving of my sandwich was impressive. It got me thinking about the way service delivery is changing.

The business was a carefully considered operation, serving many customers quickly, with no degradation to the product or service. To facilitate this, I was led to an entrance line, then to a simple menu – a choice of 3 kinds of cheese. Finally, I was led to pay, cash only, and out of the establishment via a different exit. Despite the long lines of customers, I was in and out in less than 30 minutes.

Technology choice

How much choice should you offer your customers? Are 3 kinds of cheese enough? The traditional VAR didn’t need to answer this question. The VAR supplied the technology, with some additional project services, but it was the customer’s responsibility to configure and manage the solution.

The benefits of this approach included;

• the customer had a truly customised solution
• the VAR could invoice the customer up front
• the VAR could quickly move on to the next project

But the implementation could take so long that the ROI was poor and there was often a part of the project which was never completed. Even if the solution was properly installed, it would degrade over its lifetime because upgrades were time consuming, resource heavy and expensive.

The current climate

1. The cloud has changed how customers consume IT infrastructure. Whether on or off-premise; simpler, faster to deploy solutions are required to deliver the ROI that customers demand from their IT investment. If necessary, they are willing to sacrifice some customisation in return for reduced administration and future proofing.
2. Take an MSP’s Backup-as-a-service (BaaS) offering. It would be extremely customer friendly to offer a Michelin Star style choice of configuration, but is it realistic? When the responsibility and associated risk of running the service falls to you, the MSP, how will you cope with the complexity? Too many options confuse not just your front-line service engineers but also the back-office finance and renewals team. As for the salespeople, they hate complexity!
3. Cloud-like SaaS solutions are growing rapidly where traditional outsourcing is currently in decline. HP recently sold off its outsourcing business to form DXC. IBM, the biggest of them all, is shedding staff as it shifts its operations to automated cloud. Contrast this to the performance of SaaS providers like Salesforce, Hubspot and Workday who offer solutions which are faster to on-board and simpler to run.

Your options

As a data protection service provider, you have the advantage of cross-industry experience. If you’ve been in the business a while, then that experience should lead your customers too. Like my cheese steak restaurant, your BaaS portfolio should consist of no more than 3 or 4 offerings. The restricted choice must be off-set by faster time to value through quick on-boarding and Michelin star customer care.

Your MSP platform should allow you to build a service catalogue which provides extra customisation on top of the basic service offerings. This gives you the best of both worlds – profitability for the MSP – and for the customer, greater choice.

Slowing user growth at Facebook and Twitter suggests that nothing ever saturates; there will never be just one dominant IT consumption model. We think the successful channel partners of the future will offer Michelin star style technology delivery and SaaS. This transition will be difficult, causing much angst in the channel. But that’s what makes this period of transformation so interesting.

To talk about ideas on transforming your business just get in touch, we’d love to hear from you. Our contact page has the details – Predatar Contact

Coming soon: the “technology consumption gap” – what is it and how the smart MSP can close it?

Emerging channel models

The IT channel; selling and implementing great technology from vendors to solve customer problems. The channel provides a sales engine for the vendor. The reseller makes money from reselling products and attached services. The customer operates the technology. Everyone is happy. Aren’t they?

Product resale is still an enormous market, but the channel has become a more complex place to operate:

• Growing revenues often comes at the expense of shrinking margins.
• Professional services revenue is squeezed as in-built software makes for easier hardware deployment.
• Reseller software revenues are disrupted by vendor XaaS offerings

In the age of cloud and XaaS, the relationship between vendor and channel is under severe strain. The old ecosystem of vendor, channel partner and customer may no longer be sustainable.  The ecosystem is changing; you may be wondering how you can best adapt.

The new channel model is all about the delivery to customers, not of products but of outcomes. Managed service providers (MSPs), unlike VARs, are constantly connected to their customers and add value in real time. Predatar exists to smooth the transition in moving from a VAR to an MSP model when there is an impulse for change.

Which route to take?

Predatar serves organisations with an ambition to brand and sell their own managed service. Organisations who prefer to resell various OEM XaaS offerings will need to recognise the following issues:

• The OEM owns the customer relationship
• The OEM collects and stores the data analysis about each customer
• You will probably lose professional services implementation revenue
• The OEM customer engagement platform may not allow customer data to be shared with channel partners

We assume that you want to build your own XaaS offering. Your role in this model shifts from the sale and implementation of technology, to the operation and optimisation of the technology. You will start to add true value to your customer, playing new roles traditionally performed by their in-house IT, or neglected altogether.

This opportunity does come with new risks, but only if you do not have the tools to deliver.  The tools, policies and procedures used for the old ecosystem, won’t be sufficient to get you where you need to be.  How do you know where you need to adapt and evolve?

10 signs you might need to tool-up

1. You are unable to collaborate with multiple customers through a single platform.
2. You must employ additional people to perform basic “run” tasks such as capacity management, reporting, monitoring, workload and recovery management.
3. You miss important customer engagement moments for up-selling, cross-selling and renewing contracts.
4. You struggle to measure customer outcomes.
5. Your customer usage and consumption analysis processes are not automated.
6. Service level and risk management systems are non-existent. Worse, you have no audit trail for problem resolution.
7. You find yourself having “fire-side” chats with customers rather than data-driven review meetings.
8. The tools you currently have are not easy to customise.
9. Your finance, sales and technical teams are using different tools.
10. You still rely on your OEM partners for leads and referrals.

What are we doing to help?

It’s important to recognise that a successful adaptation to the new ecosystem requires advisory services, not just software.

Predatar is the only channel transformation specialist to offer both platform and process; equipping its partners with the tools and the techniques for a lucrative evolution.

To accelerate this transformation, we are inviting partners to preview our next generation Predatar software in July. It will equip our partners with the best customer engagement platform for delivering data protection-as-a-service (BaaS, DRaaS).

A recap of what’s currently available through the platform.

Predatar provides a true multi-tenant platform for hybrid cloud data protection. It provides:

• extensive monitoring and reporting capabilities
• license management
• consumption analytics
• recovery management
• security and service intervention features.

What’s new?

In our next generation product, R10, we have built a brand-new client designed for modern, API-driven, data protection applications. This will allow our partners to connect across their different service offerings, delivering greater value-add to customers.

There is added consumption analytics capability to help you build true pay-as-you-go data protection services.

We have extended the self-service functions. The increased automation of routine and labour-intensive tasks will free up your experts to add value and focus on business outcomes.

As a Predatar partner, you won’t have to spend years coding your own MSP operating system. You don’t have to make expensive and time-consuming mistakes. We’ve done it all, so you don’t have to.

Are you ready for the new ecosystem? We’d love to hear about how you are adapting. Get in touch at https://www.predatar.com/contact-us/

Mike Tyson. He stood out from other boxing professionals because he knew what he wanted, what he stood for and what was important. An extreme desire to win coupled with his trademark spartan attire (black trunks, black shoes, no socks, no robe) enabled him to focus on what was important; knocking out 22 fighters in the first round. This differentiated him from others who often let the hype distract them from their objective.

The B2B IT market is hyper-competitive. Being able to differentiate your product or service while focusing on your key skills is critical. Being different helps you win contracts, grow market share, build loyalty and compete against bigger players.

What is Differentiation?

We see products and services being differentiated by price, geography, industry and customer type. Does following this strategy allow you to win consistently?  Mike Tyson knew that real and long-lasting differentiation comes from knowing what you stand for. What do you want to be remembered for?

Sixteen years ago, we founded a channel value-added reseller, called Silverstring. Our basic plan was to sell IBM storage solutions at low-cost to the smaller enterprise, but it just didn’t get the juices flowing. Our business only grew once we differentiated; providing a consistent customer experience, at scale, in the data protection niche. Our focus became operational processes and service methodology. We used automation to create consistent experiences; freeing up our skilled employees to add value to the business.

As a service provider (MSP), what will make you stand out from the crowd? I’m a big believer that the answer lies in the name, service. Your service should define your brand, not the technology features of your products. Technology inventions are notoriously elusive and easy to copy. Imitating a service or company culture is far harder.

Winning in a crowded market

Take the business I know most about, backup and recovery. In 2017 it attracted one-third of the venture capital money invested in IT infrastructure and yet no vendor has more than a 20% market share.

The data protection industry is predicted to grow from $7.17 billion in 2017 to $11.6 billion by 2022, a compound annual growth rate of 10.2%. Much of this growth will be from data protection delivered with a consumption or utility model, BaaS and DRaaS.

This is a huge market and can be profitable for large vendors. However, the channel players can find the market fragmented and hyper-competitive. VARs and service providers should look beyond price as a competitive advantage (you’re not Amazon). Look to differentiate through better service, better processes, brand identity and culture. Peel back the layers and define the core customer problem.

Let’s look at another competitive business, aircraft manufacture. An engineering and technology business you might think. In fact, the industry spends $15 billion a year servicing these aircraft. This equates to $3.6 million per aircraft per year or around $1000 per flight hour.

At trade fairs the latest technology from Boeing and Airbus make the headlines. This is ironic considering what matters most to the flying public is the quality and professionalism of the maintenance.

It’s the same with protecting your customers’ data. Even great technology can fail. If the service is lousy, sooner or later an event will happen causing data loss and damaged reputations for you and your customer. It’s not enough to just focus on the vendor technology which underpins your service.

Advice for the Managed Service Provider

Remember Mike Tyson? To differentiate, MSPs must personalise their service offering and focus on what’s important to them and their customers.

As a starter-for-ten here are some ideas to get you thinking about how to create a competitive advantage:

1. Focus first on your customer service team before your technology platform
2. Make it easy to engage with your service
3. Deploy new workloads faster
4. Customise your offering for a specific industry
5. Innovate your pricing model – reduce financial friction
6. Build confidence in your service – find ways to be more transparent
7. Have differentiated branding and appeal to narrow market segments
8. De-risk the outcome – put some skin-in-the-game and commit to results

Be more like Mike. Be remembered for delivering excellent outcomes every time.

Please feel free to send us your questions on building a growing MSP business. We can be reached at info@predatar.com

Written by Alistair Mackenzie, CEO, Predatar