Our industry is changing. The technology channel is changing, driven by a combination of new technology models and customers eager to use those models. But it will also be the simplest definition of this change as things only get more complicated.
Customers often don’t know how to get to where they want to be with these technologies. Suppliers, banks, and other key parts of the channel ecosystem don’t necessarily have the necessary processes to keep up with the changing industry. And, above all, service providers such as distribution SMEs do not know how to adapt to the new market.
Today we first address the last question: How can small channel providers adapt to a changing industry? How are they evolving to offer new types of services and support and, ultimately, to become managed service providers?
This is not a moot point. From the customer’s point of view, selling equipment is no longer enough. If you want a part of their business, you often have to bring more skills to the table or support more elaborate SLAs. Customers want the value and opportunity offered by the new market of flexible and modular technologies. Only changing channel providers can meet this expectation.
Still, it’s not a change you can make overnight, and it’s hard to say when that change will happen. If your traditional business is still strong in terms of revenue streams and your consumption-based business continues to grow slowly, when will you reach the tipping point? Will you ever reach it? How do you encourage it without putting your results at risk? Is it possible?
These are difficult questions with no apparent answers because there is no specific right way to get them. Adopting new skills and new products is risky, especially if it is a big pivot from what your business is used to. A bad choice of skills or a bet on a supplier can bring down a supplier SME.
This is partly because the digital transformation is unclear. I consider it a bespoke jacket – you have to keep adjusting and changing the jacket before it fits properly. And sometimes we get lost in the details and then fail to see digital transformation for what it is. The current transformation triggered by the pandemic could be artificial. People working remotely are not a transformation because it does not change the business model. Once everyone has a laptop and a dongle, it’s back to square one. The fundamental digital transformation must be the transformation of the business. A channel provider who doesn’t understand this will continue to chase after surface trends.
How do you avoid being part of these companies and instead manage your transformation to services in a smart way? Start by seeing what your customers are talking about. What are their ambitions around the cloud, digital consumption and managed services? Also look at what non-customers and competitors are doing. Look for deeper trends that won’t evaporate when things are sorted out.
Then move on to the second (and most difficult) step: Evaluate your own business. Inertia within your organization and attachment to current income streams will be your biggest obstacle. This can hinder your skills transformation – and you will need to take care of your skills. If you don’t have digital skills, your new business can’t transform digitally. And you certainly can’t help clients transform their businesses.
These are tough questions and tough decisions, which is why Axiz is mobilizing to help reduce some of this risk. We asked how we can help our partners – especially SME channel providers – to change to meet new market demands. After focusing on this strategy for several years, Axiz is now able to combine skills and services, and distribute them to allow our resellers to make the transition at their own pace or at the pace of their customers. We also provide business advice, supplier opportunities, transaction management and financial support to our registered small business partners.
If you want to find your place of distribution business in the new channel market, look for these deep trends among your customers, non-customers and competitors. Assess the direction, appetite and resilience of your business. Take stock of the skills you need. And contact Axiz – we are also transforming our business and part of that is giving more support to our partners in a rapidly changing world. Let us help you grow in services and take advantage of new market opportunities.