Traditional channel programmes - which focus on rewarding partners for reselling hardware, software or services - are "fundamentally challenged", according to a Gartner analyst, who has called for a "re-imagination" of how vendors engage with partners.
Tiffani Bova, who is a vice president at the research firm, argued in a blog that vendor channel bosses are being "held hostage" by the age-old metrics that have governed partner programmes since the industry's salad days in the 1990s.
"As the interest, applicability and use of cloud services expands, fundamental challenges to the existing/traditional channel programmes continue to arise," Bova (pictured) wrote.
"The long-term view from channel leaders requires more innovation and willingness to take some risks when it comes to channel programnme development - especially by the traditional on premise providers who now have introduced cloud services to the market."
Unfit for purpose
Programmes that have at their centre resale of hardware, software and services, including cloud, are no longer viable, according to Bova, who argued vendors need to move to a "holistic, integrated and customer-driven" programme framework.
Most programme development today focuses on tweaking what is already in place, Bova lamented, rather than the long-term needs of the vendor and its ecosystem. Even vendors who introduce targeted incentives to help partners make business model transitions are missing the point as this stops partners finding their own path, she added.
Only radical change will be sufficient, Bova said, before adding that this will not happen overnight.
"Nevertheless, the re-imagination of how to work with the channel will be necessary if a provider wants to respond accordingly to the new speed of business and IT departments," she said.
"Programmes should focus on the financial relationship between the vendor and the partner and further driven by how the partner is using the technology within their overall offer, and what advanced services and intellectual property they bring to the table and not the volume of ‘product' they resell."
Vendors and partners should look back fondly and remember their favourite channel programmes from the 1990s which brought a sense of stability and predictability to business, "because those days are gone", Bova counselled.
"There is nothing we can do to slow down the pace of change we are facing as an industry," she said. "However, what we can do is work hard to become more agile and adapt to those changes more quickly, without disrupting the existing business too much."
Bova concluded: "These next few years won't be for the faint of heart. They will be for those who have the courage to lead their companies into a healthier future driven by market and customer demands and not the latest vendor programmes and incentives."
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