During the last year, I attended many entrepreneur meetings all over Switzerland and I met many, many new cloud fans. Cloud solutions are spreading. What does that mean for the traditional business partner? Bad news actually.
Cloud solutions with the most impact on our business, are normally provided by the biggies. Microsoft, IBM, Oracle, SAP, Google you name it, they have it.
SAP one design is eating into the SAP Business One business, Microsoft 356 into every business partners revenue stream, IBMs LotusLive, too. Suddenly, the Big Ones can provide services to everybody fast and easy and all we can do, is migrating our customers and then they are gone for good.
Customers love cloud solutions. No more hassle with servers and all the updates. Access it everywhere. It is cool. They may loose a bit of individualism, but today’s software has so many features, that at least 90% of the needs are covered by one provider or the other. The need of the average business for individual software is diminishing. Some of this is just happening in the heads of CIOs and CEOs who want main stream solutions. They see it as less risky to buy of the shelf. That this may lead to additional manual work, instead of automatizing, is just not a factor. ROI isn’t an overwhelming argument (Silly, if you ask me). Many customers see recurring manual work as more productive, then taking the time to create a template and reusing it. Really! I heard this story so many times, my blood pressure doesn’t even raise anymore. A gain of productivity and a pay back within 6 month just isn’t always an argument in IT. BTW, that’s one reason, why Lotus Foundations failed in the market (apart from that nobody knew it). Gaining time in setting it up and having a incredible good backup and recovery system, isn’t enough. Because during normal operation it works like anything else and you can’t complain at the country club, like your chums who went main stream, or in other words, it had no want-to-have-feature for the user.
Now back to the cloud. It’s the new black. It was Apple and Google that broke the Microsoft monopole for good to make room for everybody else to start cloud solutions. Today it’s cool to have an iPhone, iPad, Mac Book, iPod, at least at home. Android is kinda cool, too and Microsoft is just for the rest. You need it in your company, it is taken for granted, but it is not the ultimate thing to have. Today customers only want to know, if the new CRM works in the web browser and on the smart phone. The technology isn’t important at all anymore. Or would you care, if SAP uses Oracle or DB2 for SAP by design?
As a Business Partner of any of the biggies, we should be alarmed. Don’t get me wrong. If I was Sam or Steve or Gini or Larry, I would do exactly the same thing. Eliminate the middle man (the BP!) and bind the customer directly to me. Hey, but what about the BP, who has been a loyal follower for years? Who cares. Frankly, we are all attached to Notes, not so much to IBM. Probably to Ed, but not to IBM. BPs who are playing on both sides, Exchange and Domino, are from my point of view as the boss of IBM, not my loyal followers. Yes, yes, we always told customers that Domino is so much better, but they still want Exchange. Got it? We are rather loyal to the customer. If there was a completely new product with all the nice things of Notes and more, more speed, better design and so on, we would all jump wagon before you can say SUPERCALIFRAGILISTIC – EXPIALIDOCIOUS. Now why should IBM care about us? They don’t have to (we would better call ourselves resellers or something neutral, than partners).
It’s all about keeping the customer. There are a quite a few arguments, that do not work.
If you tell customers that by US law for US companies or companies that just do business in the US, his data must be made available on request to the US authorities, without the need to inform him!
He does not care. I do, but I have yet to find somebody who does care.
„If you have no internet, you don’t work.“
Internet is extremely reliable today, therefore not an argument.
„You still have to do backup, because you can’t trust your cloud provider.“
Customers just expect, that the clouds backup works.
„You will have problems to get your data back, when you want to migrate.“
Why should I think about migration now?
„You will have problems to get support.“
No, not really, it may be less comfortable than just calling you, but it works.
„You will have outages at the worst possible time.“
But they do guarantee 99% accessibility!
… and so on. The answers of the customer may not be always entirely correct, but he believes it, because the cloud sales told it.
What should we do now, to keep our customers? I know, on premises isn’t dead, but if the stuff in the server room is more complicated and less performant, than the cloud, more customers will move to the cloud. Incidentally, there are solutions which are less complicated, than the traditional stuff (LF was one, Collax is another) and they could provide customers with something that feels like the cloud.
IT companies can set up on those tools their own clouds. Collax cluster solution is pretty cool … and has a license scheme, which is clear and easy. Even I can handle the installation and the administration and it is the chance for any IT company to go forward and keep customers.
Another idea would be fractional ownership in the cloud. Buy part of a cluster and share the hard- and software with other IT companies. Makes it easier to start.
What is the advantage, if you go cloud? Keep the customer! Create a continuous revenue stream. Easier path to the customer to offer new services. Become a customer to the big ones, instead of a reseller. They will like you much more. You can take whatever technology suits YOU.
Disadvantage? Initial investment, but that isn’t so big, if you start with KVM solutions. The change of the business modell is quite a step, but managable with good planing.
If you have a customer, that wants to go cloud, why not going with him? It’s a chance or a lost customer. Rather take the chance.
And now think about XPages and XWork Server. We just got the easiest path for extremely cool cloud solutions presented on a silver tray.
Grab it. See! IBM is still caring a little bit about it’s BPs. But IBM is changing and the BP has to change, too.