We are seeing huge growth from our service provider channel, but sometimes we come across a partner who struggles to get their service off the ground. Don’t let that be you! Are you in danger of falling into one of these traps?……
Step 1 – Over commit and under deliver. Large corporations are seeking ways to drive their cost models down in the market place today by using Cloud based services. Bespoke outsourcing is not a Cloud based delivery model and yet many large Outsourcing companies are billing their services this way to large enterprise. Committing a custom delivery for thousands of subscribers with thousands of applications will lead to a higher cost model and lower customer satisfaction. If you are a Service Provider, better to start with a catalog of applications and meet the needs of the SMB first, then move up stream to the larger businesses. Migration of subscribers from large enterprise into a cloud data center is very time consuming.
Step 2 – If you build it they will come. Cash is king… it always has been so why develop an environment spending tens of millions of dollars/euros unless you have adequately done the research for who needs what and where. Looking at IaaS purchases in the last three years should give a clue. How many of these purchases (buy vs. build) have led to the success in cloud delivery of services? Again, Service Providers should develop a business model based on the demand for apps, desktops and data in the SMB and stoke your cash flow engine before sinking huge capital costs in data centers?
Step 3 – Do the same thing you’ve done for the past 10 years. Amazon has changed the face of computing with AWS and EC2… no doubt about it. And with this change comes a change in expectations. Corporations, both large and small are looking for a model that maps to their needs and AWS/EC2 is setting the standard for highly efficient, lower cost IT. Developing a plan to change your outsourcing business to meet these expectations is critical to success. And that means a sea change for many service providers.
Step 4 – Wait for someone else to lead the market. With thousands of service providers in market as a part of the Citrix Service Provider program and hundreds of thousands of subscribers, we have a bit of data on the behavior of the market dynamics. One of the foundational elements of delivering IT-as-a_Service (inclusive of apps, desktops and data) is churn. On average the churn rate for subscribers of these types of services is less than 3%. So any end customer who is acquired using this model is not likely to switch to another Service Provider. If you wait, they may be gone before you market your service to them.
Step 5 – Assume your current sales team knows how to sell IT-as-a-Service. Once again based on our knowledge of the industry with our many service provider partners this is not “just another data service offering”. Selling a catalog of applications with a defined profile(s) for desktops and a secure data offering at scale is different. It requires a sales person who can articulate the value of a predefined service and use the brand of your company to drive trust for these services. The days of “your mess for less” in an outsourced data center are quickly fading away. Selling IT-as-a-Service requires service providers to train their sales teams accordingly.
Hopefully you don’t see yourself in any of these examples. For some tips on the right way to build out a service, check out this blog .