Channel partners selling technology solutions to small and medium businesses (SMBs) and large business enterprises are transforming to stay relevant as their customers move an ever-increasing number of business processes and workloads into the cloud. This transformation requires careful planning and execution, and channel partners across all regions are actively seeking guidance on how to manage this process, according to AMI-Partners’ newly launched Business Transformation Playbooks for Channel Partners and MSPs.
“This transformation requires carefully architecting the initial cloud and managed services portfolio against the available customer base, internal technical and sales skills, service delivery tools and investment dollars,” said Deepinder Sahni, SVP at AMI-Partners. “However, a well-managed transition does end up quickly boosting business performance.”
Benchmarks and metrics reported by MSPs that have undergone successful transformations underscore impressive business performance gains:
6X ROI within three years of initiating VAR-to-MSP transformation
50 percent of total revenues driven by new customers among top-performing MSPs
18-24 months’ time horizon to new managed services profitability
1.4X growth in size of workforce to support expanded services, revenue and customer base
Business Transformation Drives New Customer Logos and Revenue Acceleration
From less than 50,000 in 2016, the number of managed services providers will grow to almost 75,000 worldwide by 2021. AMI-Partners’ tracking of these MSPs indicates most have yet to fully penetrate their existing customer base – on average, MSPs have so far converted only 20 percent of their customers to managed services.
More significantly, by transforming themselves from a reseller to an MSP, 1 in 2 have acquired net new customers that were previously beyond their capacity to serve, thus accelerating revenue growth.
Technology vendors can accelerate this transformation within their partner ecosystem by setting up formalized advisory programs that impart strategic advice via workshops and tracking key metrics with partners on a one-on-one basis.
AMI-Partners’ Transformation Playbooks are available at the U.S., Latin America, Asia-Pacific and Western Europe regions, are based on a global study of 1,000 managed and cloud services providers conducted across several leading countries.