“Seismic” Events in IT Services


Seismic and Nimsoft Join Forces by Justin Crotty
August 28, 2009, 1:27 pm
Filed under: Uncategorized

Stay tuned for full details on our upcoming announcement – Ingram Micro Seismic and Nimsot have joined ores to target the mid-market and enterprise space. More details next week!

http://www.mspmentor.net/2009/08/28/ingram-micro-seismic-to-offer-nimsoft-managed-services/

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The Elephant In The Room by Justin Crotty

The managed services market is growing rapidly and has strong, long-term potential for many who are pursuing it.  It is changing the way IT services are consumed and delivered.  It is helping many of us diversify and strengthen our value propositions and balance sheets.  We are all bullish about the future and the opportunity in front of us. 

There is one significant hurdle, however, that nobody seems to want to acknowledge – the proverbial elephant in the room.  For those of us who target the reseller, solution provider, or managed service provider market as our customer base, this issue is top of mind.  Selling managed services is hard, but not because of the technology involved. 

Not enough end users are consuming their IT services in a “managed service” form factor yet.  There is a very real, and very problematic growth bottleneck at the point of sale with end users of these services.  We, as an industry, are simply not getting the penetration into the end user base that is required to grow and scale this market quickly.  And for many of us, that growth is not happening fast enough. 

In fact, the technology sale is not the problem.  The bigger issue here is the selling itself – how do we take our offerings to the next end user?  And the next?  And the next?  If you ask several solution providers how many customers they have and then ask them how many managed services customer they have, you will find that the managed services penetration into their overall customer base is low.  Why? 

We, as an industry and a channel are still not investing enough in the sales and marketing capabilities of our respective organizations.  Everyone is to blame – vendors, distributors, solution providers.  Nobody invests enough in developing their sales and marketing capabilities. 

When I hear a VAR ask a vendor how much margin is available for him to sell a managed service, I know we are not evolving.  The margin in any managed service is how much you can get, not a number determined by a vendor or application provider.  Yet we continue to ask those around us, or blame each other, for margins we can or cannot get out of any particular offering.  The reason that this concept is so hard for us to grasp is that we simply don’t understand how to sell value and differentiate ourselves from one another.  And until we recognize that and take steps to resolve it, we will always struggle to provide the value proposition that customers demand from us. 

If you find yourself fortunate enough to have some dollars to re-invest in your business, where are you going to focus those dollars?



Greg Meyers of Tech Data On Managed Services: We’re Sitting This One Out by Justin Crotty
June 3, 2009, 8:25 am
Filed under: Uncategorized

I found this article, published June 1, in a well known Canadian IT channel trade publication.

http://www.echannelline.com/canada/story.cfm?item=DLY060109-2

The article struck me in a couple of ways. 

First, it was a rare direct shot from one of Ingram Micro’s largest, toughest, and most respected competitors, Tech Data.  Typically, the Ingram Micro/Tech Data rivalry is very respectful.  While we may disagree on strategy, course, and direction, you rarely see Ingram or Tech Data take direct shots at the other or call the other out in such an audacious manner.  

We were surpirsed at the statement Greg Meyers, a VP of Marketing for Tech Data in Canada, made regarding Ingram Micro’s Seismic program.  We were suprised simply because we don’t know Greg at all and he obviously was not familiar with Ingram’s managed services strategy. 

The second thing about the article that struck me was that Tech Data basically admits they don’t see how distribution can add value in the largest IT growth opportunity in 20 years – managed services.  Mr. Meyers states that “partners don’t want packaged services like Seismic,” and “[Tech Data’s role] is facilitator.  We’ll direct our customers to those who provide managed services.”

We were stunned and dumbfounded.  Ingram has over 1100 reseller partners consuming some or all of our Seismic platform of managed services and private-labeling those services under their own brands.  Those services provide huge margins for our vars who partake of them.  Ingram (and distribution) is well positioned to bring huge value to the table to not only assist our partners in selecting managed service partners, but also procuring, provisioning, billing, hosting, and managing many of those services in a private labeled strategy.  35-50 new reseller partners per month are becoming Seismic partners – who is Tech Data speaking to when they say partners are not interested?

I would also ask Greg, whom I don’t know, have never met, and have never heard of, what does he know about Seismic?  He’ll probably take the time to understand it if he reads this, but when he made the statement I would guess he had very little, if any, understanding of the Seismic strategy, our platform, our services, or how we deliver those services for our vars.  Could he name 3 of the offerings?  Could he describe our Seismic partner community – 1100 strong?  Doubtful.  Which is what made his statements so confusing to us.

Saying distribution has no value in the delivery of infrastructure-intensive services is like saying distribution has no value in the delivery of IT products.  Our role in the service delivery supply chain, if executed correctly, is very similar to our value in the physical product delivery supply chain.  We can help our partners go to market with a comprehensive suite of services and eliminate the complexity tranditionally involved in selecting, procuring, managing, and delivering those services…..just like we do in product distribution.

Is Greg alone in his views or does Tech Data really just not get it?  Either way, I would suggest that if Tech Data’s strategy, as Greg outlines it in the article, is simply to facilitate – point vars who are looking for managed services to those who provide managed services – I will offer Seismic as a preferred partner.  Tech Data can send its managed services customers to us.  We have 1100 reference accounts to back us up.  We’ll take good care of your customers for you, Greg.



Economic Crisis – A Rare Opportunity by Justin Crotty

Also published and originally appeared on MSPMentor.net in Feb 2009 as participating sponsor guest article.

 

 I saw an old proverb once that said of economic opportunity or commerce, “Be scared when others are greedy and be greedy when others are scared.”  Fitting advice for any MSP these days.

 

The current economic crisis is a monster – no doubt about that.  If you are under the age of 80, this is shaping up to be the worst market downturn of your life.  Cautious and prudent fiscal, managerial, and operational policy in our personal and business dealings is critical.  But what many companies and managers, in the midst of a crisis like this, may not recognize is this: Downturns are significant opportunities that don’t come along very often.

 

I am not suggesting that the current economic situation is anything other than an unmitigated disaster – it is.  Blame whoever or whatever you want for the mess we are in – government, mortgage brokers, Wall Street, hedge fund managers – everyone had a hand in it.  We didn’t ask the hard questions when times were good.  Home values were up, stock funds were delivering strong returns, money was cheap, and debt skyrocketed.  We turned a blind eye to the fundamental economics that govern markets.  Only after those very fundamentals reminded us just how far we had drifted did we stop and look around and ask each other, “how did this happen?”

 

Now we’re in a mess and the question everyone needs to ask themselves is: What am I going to do about it?  How am I going to grow my company?  Win new clients?  Retain current clients?  Make money?  Grow revenue and profits?  Invest in innovation? 

 

HP’s was born during the Great Depression.  Amazon, ridiculed and left for dead in the wreckage of the dot com bust, rose from the carnage to become the innovative, industry behemoth it is today.  IBM, during the downturn of ’79-80, bet big on a thing called the PC.  Microsoft, a small software company that successfully weathered the downturn in ’90-91 emerged to become a household name around the world.

 

What did these companies have in common through tough economic times?  Innovation.  Vision.  Risk-taking.  Market awareness.  Confidence.  Belief in self.   

 

It is critical to the current and future success of our collective businesses and companies to continue to innovate during challenging times.  No IT channel companies are better positioned for innovation than MSP’s.  MSP’s have been on the bleeding edge for years.  Now is the time to capitalize on those innovations and attack your competitors who have not made such investments relentlessly. 

 

Be prudent and manage carefully, but do not abandon the innovation and aggressiveness that is required, not only to persevere through the downturn, but to emerge from it stronger, faster, and further ahead of your competition.  Don’t succumb to the temptation to hunker down and wait it out – let your competitors make that fatal mistake.  Focus on your value proposition to your clients – reduced costs, high quality, predictable budgeting.  The downturn plays to your value as an MSP – companies need what you have to offer.

 

In the book Outliers, Malcolm Gladwell illustrates that successful people and companies, through years of preparation and dedication, capitalize on that preparation when they find themselves in the right place at the right time.  We, as MSP’s, have spent the past few years investing, building, and learning.  Suddenly we are confronted by a significant challenge, but one that we are well prepared for with a killer value proposition to leverage. 

 

We are in the right place at the right time.



Successful VARs Understand the Importance of Hiring by Jason Beal / Ingram Micro
August 5, 2008, 10:38 am
Filed under: Uncategorized | Tags: ,

There is an old expression that says, “If you pay peanuts, you get monkeys.”  Although there is a good amount of humor in this metaphor, there is also a great amount of truth in it.  Having worked with many solution providers on their staffing strategies in recent years, I’ve seen the hiring (and compensation) strategies of VARs of all sizes and shapes.  There are some solution providers who are willing to pay (and want to pay richly) for high-end, specialized talent at higher-end salaries.  Conversely, there are solution providers who reject good resume after good resume because they are unwilling to pay a market-appropriate rates for highly-qualified, hard-to-find talent.  With the trends in the IT channel towards high-end, emerging technologies focus and solution provider specialization, uniquely qualified talent is becoming one of the most critical success factor for VARs. 

 

One local solution provider in Southern California, KnowledgeCentrix, embodies the hiring, compensation, and benefit practices of successful organizations. Chris Andreozzi, Founder and President/CEO of KnowledgeCentrix, only wants to hire highly-qualified, uniquely-skilled talent. He strives to find those diamonds in the rough; he knows what he needs to pay to recruit and retain them.  KnowledgeCetrix’s benefits and “total compensation” package is on par with Fortune 500 companies. It is not a coincidence that his business is growing astronomically fast. He has a solid management staff and a team of unbeatable engineers.

 

A well-qualified Cisco engineer who is appropriately paid $30,000 higher than another less qualified, less certified Cisco engineer will certainly yield multiples more than $30,000 in billable profit to his or her company.  Each and every resource at your company is critical.  I encourage you to maximize each hire by finding those diamonds in the rough, finding unique talent, and then paying them appropriately.     

-Jason Beal



Welcome to the Seismic Blog! by Justin Crotty
January 29, 2008, 5:19 am
Filed under: Uncategorized

If its happening in IT services its happening here (or soon will be).  You’ve stumbled upon the Seismic blog – a decidely un-corporate, informative, and entertaining place to understand the services evolution transforming the IT channel. 

Ok, so that sounds really grandiose.  To be frank, I’d rather be a quarterback in the NFL and playing in the Super Bowl.  In lieu of that, selling IT services isn’t too bad.  It just doesn’t have the supermodels, the TV endorsements, or the glamour that the NFL offers.  That doesn’t mean we can’t make it interesting and fun while making a few bucks together. 

For those of you who worry that the capitalist pigs have overthrown the blog world and that this is just another example of Corporate America using a blog to drive revenue and profits….well….you’re partially correct.  But rest easy.  Together we’ll make sure this blog is informative, accurate, and valuable to those who find IT services interesting.  And let’s never lose sight of the fact that we shouldn’t take ourselves too seriously.

Stay tuned.  Peace – Justin