Channel Partners: You CAN Make Money with Cloud
It’s good news that a lot of SAP channel partners have taken to cloud. In addition to it being a consumable model that customers increasingly want, it also allows everyone to be more flexible, more dynamic and more efficient.
The great looming challenge in this trend is that as cloud becomes more prevalent, it also becomes more competitive. This makes solution providers, vendors and developers ask the question, “What should I be doing to stay one step ahead?”
There is a list of solid answers for this, but I believe that the first priority is in partner intellectual property (IP). These are the unique differentiators that package the right solution, service and added benefit to the client while also offering rich profit margins to the partner.
Take Note of the Customer Journey
So how can you recharge your cloud batteries and add more value? To start, take a look at the entire customer journey, which includes but is not limited to the job design, build, test, deploy and support cycles. Take note of the questions you’re asked regularly, the special notes your consultants receive from clients and the gaps you see in the customer’s processes. If you’re not aware of what’s happening at each stage you are likely not serving the client to your fullest capacity and missing opportunities for growth within that account.
Commit Yourself to Package Your IP
Our experience shows that if you can identify IP within your business offering and package it for marketing and delivery that it will first attract more customers and also increase the profitability of your business. IDC estimates that IP-based services have a 70% profit margin which is 60% higher than re-selling alone and 35% higher than services alone The time it takes to identify and articulate your IP is worth its weight after approximately 2-4 customer engagements .
Options for Partner Intellectual Property
I’m always impressed by the intellectual property that SAP partners develop to complement our existing solutions and technologies. Gaps are being filled in the market with expertise and offerings that make SAP solutions soar in helping businesses run simple.
There is a strong footprint already in offering pure services such as implementation and consulting for partner IP. The opportunities go beyond just services to include support, applications, integration services, localization, industry verticalization, training and application development. We’ve found that the most profitable businesses also have a well-defined channel to sell these add on services. In some cases, it is the SAP Store, sometimes through our own direct sales team and most often through the partner’s own marketing and sales teams.
Services is the most prevalent of all partner IP. I suggest looking at all possible services that can be bundled around cloud—training, business consulting, monitoring, management, support and change management. When partners are looking at the entire customer lifecycle they find opportunities to continue to communicate and serve their customers. By identifying the key strengths that a given partner can deliver to that customer and packaging it into a predictable cost, time and delivery they not only have a natural opportunity to increase awareness of their capabilities but they also are mirroring the cloud-based solution approach. Cloud software is all about having a consumable approach. Partners who are working hard to not only deliver services, but also identify their special IP in a given environment are sliding right into a cloud software and cloud delivery model.
Programs for Partner Success
Rodolpho Cardenuto, president, Global Channels and General Business at SAP, said during a launch event, “SAP must rely on our extensive network of partners to tap into this expanding market and help customers succeed on the path to the cloud.” To make this happen SAP has several key programs that can reduce the time to value in packaging partner IP. We also have specific support for the journey oi enable our partners to better recognize their existing IP and services skills, as well as develop them into meaningful, marketable packages to take to customers.
The first place for our partners to look is the Solution Centers. The Solution centers have been helping our partners develop and certify SAP Business All-in-One partner’s solutions for many years. They’ve taken those years of practical on -premise experience and extended it to the cloud, supporting our partners in development of Rapid Deployment Solutions. This is just the beginning, with the innovation and creative approaches continuing to meet the customers’ demands for easy to consume and deploy every day.
The SAP PartnerEdge Cloud Choice, profit option is a great alternative for partners who are just ramping up their cloud practice. With this option, partners can focus on building their offering instead of looking at ways to de-risk the financial liability of a cloud customer. This option helps our partners invest in building differentiated offerings, a sustainable approach to profitability in the long term. Cloud Choice profit is a great way to get started and build a successful practice.
Also, when SAP introduced its SAP PartnerEdge Cloud Choice, referral option last fall, the impetus was to reward members for generating new business leads to SAP. We do all the heavy lifting, but you still make money and retain the ability to focus on your own services.
These initiatives are just examples of the benefits of partnering with SAP and our SAP PartnerEdge program. SAP has set the table for our partners’ success. Now it’s your turn. What kinds of cloud services can you cook up to ensure customers keep coming back for more?
 “How the Partner Ecosystem is Evolving in the Digital Economy”, IDC, Steve White, Directions 2017 February 28, 2017, Santa Clara, CA
 “GB Cloud Partner Packaging: The opportunity to drive growth from packages”, Credo Group, February 17, 2017