Channel Partners Critical to Successful AI Adoption, Says Research

Artificial intelligence (AI) is the topic on everyone’s lips. But channel partners will be critical in helping customers transition from hype to adoption, according to new research.

Data observability and security vendor Dynatrace commissioned an independent global survey of 1,300 CTOs, CIOs and other technology leaders in large organizations. It discovered there is a real opportunity for the channel to grow revenue by helping customers to drive successful AI adoption.

Specifically, the research identified a need for the channel to deliver services that help customers accelerate their AI adoption strategies with greater confidence and reduced risk.

The research found 83% of technology leaders say AI has become mandatory to keep up with the dynamic nature of cloud environments. Eighty-two percent say AI will be critical to security threat detection, investigation and response. Eighty-eight expect AI to extend access to data analytics to nontechnical employees through natural language queries. Meanwhile, 88% think AI will enable cloud cost efficiencies by supporting FinOps practices.

'Unmistakable Opportunity' for Channel Partners

Michael Allen, VP partner sales worldwide at Dynatrace, said the hype cycle triggered by the release of ChatGPT late last year has generated significant interest in AI.

However, 93% of technology leaders are concerned that AI could be used for non-approved uses as employees become more accustomed to tools such as ChatGPT.

Dynatrace's Michael Allen

Allen said customers are looking to invest in technologies like AI and automation to drive down operational costs while also increasing the speed of digital transformation. But they’re also alert to the risks of moving too quickly and handing over control to an AI or an automated process before sufficient guardrails are in place.

“Channel partners have an unmistakable opportunity to add value and unlock new revenue by helping customers to establish these controls so they can adopt AI safely and securely," he said.

Good news for channel partners is that 61% of technology leaders will increase investment in AI over the next 12 months. This is driven by a desire to speed up development by automatically generating code.

Channel Partners Pivotal to Dynatrace Growth Plans

Channel Futures met recently with Dynatrace CEO Rick McConnell. He talked about the vendor being dependent on channel partners to help the company grow.

“What got Dynatrace to $1 billion in ARR – and we’re now already bigger than that, isn’t going to get us to $3 or $4 billion. To get to those levels, we need leverage our go-to-market approach,” he explained.

McConnell said he expects the percentage of Dynatrace business fulfilled by partners to increase.

Dynatrace's Rick McConnell

“We’ve all always been partner-focused. More than 60% of our revenue is delivered through partners. So we’re not starting from scratch. And yet, there’s so much more leverage that we can get out of the partner community.

“We’ve been particularly focused on global systems integrators, regional systems integrators and hyperscalers. But we have a broad ecosystem of partners, all of whom contribute to a material way to the growth of the company. We look at the partner community as a flywheel. Once you get it started, it really amps up the pace of acceleration,” he added.

“We believe based on the feedback we get from customers, we have a solution set that adds a ton of value to companies. We just need to get to more of them faster. And the partner community enables us to do that.”