Consortiums – Where does this lead us?

The rise of consortiums (multiple manufacturers integrating their products to produce an integrated, “pre-built”, solution) poses an interesting set of questions about what IT will look like in the future and the role the channel will play in that future.  Integrated offerings look to the purchaser to be easier to understand, easier to justify, and easier to support or to acquire support.  The channel may need to recognize that a new wave of thinking with regards to addressing end-user needs is upon us.  Being a bit sarcastic, but are we looking at another round of “evolve or die” in the channel?

What does it do to the channel?  Does it minimize the value the channel provides, or does it open up newer opportunities?  There are newer opportunities, for sure, but are they more vertical? More limiting?  Deeper knowledge and expertise can now be acquired, retained and delivered across the specific components of the integrated stack.  This is great for the consortium’ and their specific product, great for those in the channel who have that expertise, and great for the end user.  Conversely, does it impose limits on the breadth of solutions that the channel partner can participate in selling and supporting.  One would think that it has to.  The channel partner only has so many resources.  But, the consortium’s products should already be built to work together, and hence there are limited support requirements since the platform should perform more effectively than if someone had sown the platform together themselves.  So, there are a number of opportunities to argue that the consortium solution requires less support from the channel. But the consortium’s integrated solution still needs to work in the heterogeneous environment of the end user.  So, will channel partners evolve who focus purely on the integration of consortium solutions into brown field opportunities. Can the partner scale, becoming an expert in both the actual consortium built solution, and the integration of that solution into the end user’s heterogeneous environment.  Can channel partners combine (collude?) to marry their expertise of the consortium’s product and various end user environments?

The Consortium’s solution should be, theoretically, easier to sell.  Once you create an integrated offering, you basically move up the technology evolutionary scale, becoming a business solution as opposed to just being a technology solution.  Business solutions imply an easier ROI equation as opposed to technology solutions.  The opportunity for the channel is the relevance of that business solution to the end user’s needs.  The channel is now presented with the opportunity to more deeply ingrain themselves in the strategic decision making process of the end-user.  In order to get there, new thinking in the areas of relevance selling become critical.  The consortium’s solution has multiple components that are synthesized into a business solution.  Traditionally the channel was more adept in the lower rungs of the technology scale – selling the components or providing the services necessary to synthesize the solution.  With these two components of the sales opportunity now being potentially commoditized or completely eliminated via the consortium’s solution, the opportunity to focus more on the end-users business needs takes on greater value to the channel.

This all presumes the consortium concept really takes hold.  It could be that the HP’s, IBM’s, and Cisco’s of the world are just going through a “phase” and their relationships and partner eco-systems will reform so often that integrated offerings being created by consortium’s today will just be an ongoing stream of alternatives, with the consortiums themselves being fluid and temporary.  But, the investments and rhetoric seem to indicate that this time we may have more substantial, long-term entities being formed.  Whether we are in a temporary fad or a true market transition, the channel will most like succeed by focusing on moving up the technology/business solution evolutionary scale, listening to the needs of their customers, and solving for those needs with the most effective, stable solutions available.


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