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Taking on Transformation

By Khali Henderson
September 01, 2011 - Article

In this installment of our ongoing report on the channel’s movement away from transactional models, we will take a closer look at the best route to transformation, e.g., hiring, acquiring, building, partnering, etc.

“This really is the magic question, isn’t it?" said Lawrence M. Walsh, president and CEO, The 2112 Group, a hannel consulting firm. Walsh said that the tactics must come second to a commitment to a change in the business model — how the partner defines its value, packages its products and services and takes it to market. “Embarking on acquisitions or partnerships without first adjusting the underlying business model will doom a transactional partner to failure," he said.

Commitment to the transformation is oft-repeated advice from channel analysts, vendors and partners Channel Partners interviewed for this special report. One reason for this, explained Tommy Wald, CEO, White Glove Technologies, is that “transformation often comes at the cost of intentionally destructing one or more parts of your business in order to focus resources and priorities on the new way."

In other words, it’s not for dabblers. And, the market will respond accordingly, noted Darren Libby, program vice president for software channels and alliances research at IDC. He said regardless of a partner’s chosen path to transformation, “tentative experimenters are always going to lose out against the committed partners who have taken a position on their new lines of business."

Experts took care to suggest that all avenues are legitimate for transformation, but the best route is likely to depend on the partner’s starting point. “There is no one right answer," said Tiffani Bova, vice president of research for Gartner Inc. “You must do a complete inventory of your business to ensure what you have is able to sustain any major changes or if you need to find another way to get yourself where you are trying to go."

Begin by evaluating your company’s strengths, weaknesses, opportunities and threats (SWOT), said Ken Bisnoff, senior vice president of strategic opportunities for TelePacific Communications. (Google “SWOT analysis" for tips on how to do this effectively.) “Your largest returns will come from exploiting those things that you do very well," he said, noting the hard part comes in honestly assessing your weaknesses and threats and looking at the best ways to fill those gaps.

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