As our world of physical devices and data exchange becomes more and more connected, business processes are rapidly changing. We are entering a new era of computing technology called the Internet of Things (IoT.) Like many of the disrupters of the past such as virtualization and cloud computing, IoT presents many challenges to both end-user customers as well as the channel. It shifts the players and standard conversations of Information Technology (IT) to be more aligned with Operational Technology (OT.) In fact, Gartner foresees by 2020, we will see this convergence grow, we are talking 50 percent OT service providers seeking partnerships with IT-centric providers for IoT offerings.
To fully understand the opportunities and challenges the IoT era poses for Value Added Resellers (VARs), Managed Service Providers (MSPs) and the channel, we need to look at the complete picture of IoT adoption, not just how to gather information from sensors but how to convey to the line of business the stages of ideation through traction that leads to a successful roll-out of IoT. Let’s discuss how to approach IoT opportunities with your customers. Gartner Predicts 2017: IT and OT Convergence Will Create New Challenges and Opportunities.
Establish a guideline: Identify what is being compensated.
Although the world is becoming increasingly interconnected, your sales force may not have the right incentives to support this growth. Motivation is always a strong factor so it is key to understand how sales representatives are being compensated before expecting them to initiate an IoT conversation with their customers. Similar to cloud, IoT can be a subscription based, pay-as-you-go model. If sales representatives are only compensated on hardware and compute, they may only target a CIO and may never have a conversation with IoT’s true contenders - the line of business.
You need to pivot your concentration from 2nd platform enterprise hardware to 3rd platform technologies that are more focused on OT line of business. Additionally, enterprise hardware sales plus maintenance renewal is shifting, and in order to offset some of the loss and revenue it is more sensible for traditional sales models that fret over one-off sales every month to consider a Monthly Recurring Revenue Model (MRR) that helps them focus foremost on customer support and retention. VARs and MSPs may need to rethink their sales processes, compensation plans and incentives if they would like to stay competitive in this prosperous era of interconnectivity.
Build a strong case: Gain a true understanding of vertical application.
When it comes to IoT, the CIO is no longer your target customer. Your source for IoT opportunity is with the line of business, no matter the industry. Gaining a true understanding of verticals and how to speak to their particular challenges and business needs will encourage your customers to be more receptive to the possibilities of IoT, including how to ultimately improve efficiency in their line of business.
In retail, an IoT opportunity could mean reaching out to a building manager or possibly a store manager to discuss how products could be more visible and tracked for real-time inventory. For manufacturing, it could mean speaking to the production line manager to discover pain points in production efficiency. In fact, one manufacturing bottling company benefitted greatly from IoT to help address an issue in their production line. It was uncovered using a 5-4-3 ideation approach that this company needed a better way to detect blade dullness in their labeling process to schedule proper maintenance so they could avoid the $35,000 hit each time production had to shut down due to a broken blade. Because the blades were expensive they did not want to change too soon and required smart device technology to detect the ideal time for maintenance. This opportunity could have easily been overlooked if a conversation hadn’t happened with the line manager. Just goes to show why it is key to understand your verticals and the key players in their respective line of business operations.
Realize your drawbacks are not limitations: Let go of this idea that you have to be a developer to hold an intelligent IoT discussion.
There is no way to sugar coat this: if you think you can manage IoT yourself you cannot, and why would you want to? Think about it: IoT consists of connecting a massive amount of devices across vast organizations, industries, networks and providers. We are talking E-C-0-S-Y-S-T-E-M and there is no one company that is the sole possessor of all this intelligence. This is why the concept of IoT thrives on partnerships to leverage shared resources and knowledge to address the many facets of its ecosystem. Why waste the time and investments needed in developing when there is a shorter path to revenue for you – by partnering with an IoT ecosystem aggregator. Let a trusted resource of suppliers, services, tools and finance options help accelerate your sales cycle.
Engage in IoT: Understand why partnering with an IoT ecosystem aggregator is beneficial.
There is an online resource that millions of people nationwide utilize to help them find the most suitable local service providers, like electricians, plumbers, carpenters, roofers, mechanics, doctors and dentists; it’s called Angie’s List. It is a valuable resource to help consumers navigate available services and make informed decisions to fulfill their current needs. By helping take the guess work and fear of the unknown out of people’s decision making process, consumers are able to engage with service providers with more confidence.
Now take this same concept regarding convenience and detailed insight of service providers within one platform and you have Tech Data’s version of an “Angie’s List” for the IoT ecosystem. Tech Data provides edge-to-enterprise capabilities from sensors and devices to communications and platforms to deliver holistic solutions. With trusted resources such as seasoned sales and technical pre-sales support along with tried-and-true proof-of-concepts and real world technology use cases at hand, access to IoT solutions just got easier. We help guide our partners through the challenges of IoT and its many facets by acting as your ecosystem aggregator.
In addition, to the aforementioned tips on understanding how your sales force is compensated and the importance of vertical application, our marketplace for IoT solutions is another resource to consider for expanding your market share with little risk.
Now is the opportunity for Solution Providers to understand how they can become players in this new era. For more information, check out this video, IoT in the Channel.