“You’ll never find a better sparring partner than adversity.”– Golda Meir
This week, we’ve are all currently swamped by news items of doom and gloom. The Covid-19 (novel coronavirus) is on the verge of WHO‘s definition of a pandemic – a globally prevalent disease. (By the time this goes to print it probably will be classified as such.)
Many countries are already treating it as such by enforcing their own travel restrictions, blockades and disinfection programs.
And now the flow on effects are coming thick and fast. Major equities market corrections that show no sign of slowing down are rapidly turning a 10-year bull run into a bear market.
Does it seem likely that Warren Buffet – with his cash pile of $130B plus – knows something the rest of us don’t? Probably not – it is just astute investing practice – keep cash on hand when markets are seriously over-valued.
If all this seems a bit distant from business-as-usual in the channel here in Asia, then you’re living on some other planet called Not-Reality.
What channel partners in Asia need to quickly wake up to is accept that nothing right now is business-as-usual. The going is going to get tough and the tough need to get going.
Here are five key challenges that will confront channel partners and what actions need to be taken.
Supply chain disruption
Arguably this is the biggest crisis for vendors and partners. Assuming that you have solid deals in the pipe, how are you going to deliver? What commitments have you made to your customers? And in turn, what commitments have your vendors made to you?
The bottom line is that disruption is the new norm and partners need to be contingency planning.
Partners should immediately begin discussions with their vendors on delivery schedules and be aware that vendors will likely prioritize partners who have committed forecasts versus those who do not.
When dealing with commodity items, having alternative sources for product can be critical. The bigger the vendor the larger the clout they have in successfully negotiating with their own supply chains.
Whilst vendors likely won’t directly share the impact that is having on them compared to their competitors, partners must be cognizant of the reality of their situation and how it impacts your own business.
3rd platform transformation
Let’s assume that your partners that have begun transformational planning to the 3rd platform. They are certainly in a stronger position than those that have not.
IDC defines the 3rd platform as the continuing rise of cloud and the general availability of the supporting pillars of big data, analytics, social and mobile. Being fundamentally supported by cloud technologies of course reduces the need for physical supply chain dependencies.
The necessity to have implemented some form of transition plan existed well before the current situational emergency and partners who have begun the transition to the 3rd platform should consider accelerating their transformation.
Sales compensation
If you haven’t done it yet, then this would be an excellent time to implement compensation plan changes. To get more focus from sales on the 3rd platform, partners need plans tailored to focus on recurring revenue streams versus big deal one offs.
Questioning whether even if a big deal of servers and storage happens, can it actually be delivered in the necessary timeframe?
Moving more business opportunities to cloud infrastructure eliminates the need to source hardware supplies. Can your existing deals be reworked to a PaaS, IaaS and SaaS model? If you don’t know it might be a good idea to find out what the client’s preference is, particularly if you start discussing the possible implications of supply disruptions.
Digital and Social marketing
How many events have been cancelled across the region as companies avoid close quarter face-to-face marketing? Cisco, Oracle, IBM have all either cancelled or postponed large gatherings.
Partners who have in the past focused on marketing development fund (MDF) spending aligned to traditional marketing need to get shake things up quickly. Getting smarter about how you get your messaging out to the market – buying booth space at large events – won’t cut it under the current crisis. Accelerate your plans and investments to deliver results on all aspects of social media and start paying attention to those digital marketing activities that you had previously put on the back burner.
Flexible working arrangements
How has your company implemented flexible working arrangements? Many companies are simply not set up properly to promote and implement alternatives.
Staff working from home can be a good option providing that those staff are effective in a home environment. It suits some employees, but not others who can find themselves easily distracted in a non-office environment.
HR teams need to take a close look at what the alternatives are and ensure that suitable tools are available to maintain productivity.
IDC has composed extensive research on Partner Transformation over the past several years which provides detailed transitional roadmaps for companies recognizing the business need for them to change.
