I think I've made my thoughts about IT service providers pretty clear.
Many of us believe that there will be a fundamental shift in IT consumption, from "IT as products" to "IT as a service". As a result, there will be a new cadre of service providers who will cater to this fundamental shift.
We, as EMC, intend to be the #1 provider to service providers. To do this, we need more than great products and services -- we need to be business development partners as well.
And, over the last few weeks, I was fortunate to participate in a handful of "second round" discussions with more than a few of our service provider partners. It was fun.
Second Round?
I suppose I can't explain the second round without describing the first one, right?
The "first round" is when we work with a service provider on setting up the first round of IT services based on EMC and partner technologies.
There's a lot of market sizing and segmentation, designing and building the service(s) (usually on a Vblock these days), helping to light things up, and then doing our bit to promote and drive consumption of the new service.
There's also a sense of teenage first-date awkwardness -- we don't know each other too well, how the other party works, what's expected, etc. Lots of good intentions on both sides, but -- in reality -- we barely know each other.
A few months later, though, we're usually ready for a second round of discussions.
The first service is going well. There are happy, paying customers. These same customers are starting to share other things they might want from an enterprise-focused IT service provider.
They now want to sit down with us, and discuss a second round of EMC-based services that complement the first round. That's cool.
Common Themes?
The discussions in the second round are very different, as you might expect.
During the first round, there's a predominance of "first offering jitters". Will anyone want our service? Will it be too expensive? Will we be able to explain to prospects what makes us different? Will we land in the lap of a stronger competitor? And so on. All normal stuff.
During the second round, the focus has changed. They've found willing customers. Price is always an issue, but not so much. They've learned the quintessential skill of differentiation. And they've found that no one out there does exactly what they do.
Confidence is restored -- and with that confidence comes a new-found desire to do more, and do it faster.
A Pragmatic Approach To SP Business Model Planning?
All of this provides only more reinforcement to my overall approach to SP business model planning.
Who are your customers today, or the ones you could easily reach? What are their unmet needs? What's the Very First Service you could offer them without too much effort on your part?
Learn from that first service offering. Tune your approach, and figure out the Very Next Service you'd like to offer them.
Avoid over-investing in creating a gold-plated whiz-bang service until you see paying customers line up. And avoid over-investing in trying to reach customers that are inherently hard to reach.
Let one market success lead you to the next one.
Fast incrementalism. Learn your way into a market. Lather, rinse, repeat. Balance investment against revenue and profits. Avoid the big bang.
On To A Third, And A Fourth ... ???
On the traditional enterprise sales side, we usually meet with our customers regularly to review the last IT projects we've done with them, and explore areas to do even more. Less of a sales meeting, more like a planning review.
With our channel partners, we do the same thing: how is business going for you, and where should we be working together on new opportunities?
It's nice to see the same cadence shaping up with our SP partners ...
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