Channel Visionaries: Traditional Channel Models Becoming Obsolete

We’ve been hearing about it for a few years now: The traditional tiered channel partner program is a dinosaur close to extinction. Now, it seems vendors need to start writing their obituaries.

That's the message from Tiffani Bova, vice president and distinguished analyst at Gartner, who offered her vision of the channel in 2020 at the Channel Visionaries conference this week in Newport Beach, California. As the channel moves beyond the traditional hardware reseller into hybrid and born-in-the-cloud models, the traditional channel models no longer hold sway.

“Most born-in-the-cloud guys don’t even know what MDFs are,” Bova said to the crowd, made up mostly of vendors with traditional channel programs. “Your current programs don't have what they need.”

To succeed, vendors must focus less on their traditional partners and instead develop programs that cater to the hybrid and born-in-the-cloud service providers.

For the record, Bova describes hybrid providers as those traditional channel partners that have integrated cloud services into their palette and have begun developing their own services and solutions. They also have made “logical investments” with existing providers and have increased their application development and professional services muscle.

Born in the cloud providers, meanwhile, are those companies whose core business model is professional services and system integration, Bova said. They also have heavy custom application and software development knowledge and are more closely aligned with cloud services providers than other technology companies. Recurring revenue is a significant part of their business.

And therein lies the disconnect between the majority of today’s channel partner programs and those up and coming channel partners.

“You need to work hard to let go of your muscle memory and the DNA of past programs. You need to reimagine the future of partnering,” Bova noted. “New partners don’t look for the traditional things.”

Those companies that are getting it right when it comes to meeting the needs of the new face of the channel are those that, too, were born in the digital economy. “Companies such as Amazon … whose programs look nothing like traditional channel programs.”

Bova, as she noted at the beginning of her discussion, is looking at the channel from the lens of the year 2020. But she pointed out we are five short years away.

“The decisions you make today won’t manifest in 18 to 24 months,” she said. “This is a journey toward where we empower the channel three to five years out.”

Still there’s no time like the present to start working on ensuring the success of the future.