Software publishers and their partner communities have made (and will continue to make) significant capital investments in robust trial engines with an expectation that the trial experience will provide sufficient “proof” and “comfort” to intelligently inform and drive an accelerated decision making process. If only it were that easy.

Historically, “proof” and “comfort” were established via product demonstrations delivered throughout the sales/buying cycle. Prior to product demonstrations sales professionals typically facilitated structured discovery sessions to determine prospect business pains and business process challenges, then converted them into recommended functionality. This functionality would then be demonstrated by a seasoned pre-sales/delivery consultant, who inevitably framed and positioned their solution recommendation as well as handled objections and/or corrected misconceptions. With these comprehensive and influential “proof” activities in place, most Partners drove a 20% – 25% close ratio; and buyers experienced a 50% – 65% project failure rate.

Replacing this structured approach with an unmanaged trial experience will inevitably lower both conversion and close ratios. Business applications are complex beasts, so unless prospects are looking for simple contact management (CRM) or a basic set of core financials (ERP), there is a high probability their trial experience will be a frustrating one as they root through complex modules and wrestle with unfamiliar UIs in search of their ERP/CRM panacea.

Yet…..with average selling prices dropping, cost of sale increasing and a demand-side transition towards subscription licensing on the rise, trial experiences are here to stay. The question becomes…..how do we mitigate or reduce prospect frustration and confusion as they blindly attempt to unearth their utopian future state amongst the hundreds, (or thousands) of available menu and screen options?

The answer lies in developing a trial management strategy that includes some or all of the following options:

• Limit the trial experience to 1-2 contacts
• Create a template for prospects that helps them define the specific functionality they need to explore during the trial to meet their critical business requirements
• Document and provide prospects with a “trial guide” that walks them step-by-step through the most critical (and differentiating) business processes
• Deliver regularly scheduled mandatory one-to-many trial preparation webcasts that prospects must attend prior to securing access to their software trial
• Deliver one-to-one trial engine ‘tours” for larger opportunities
• Configure trial engines for specific vertical industries
• Implement a “chat now” capability throughout the trial application that routes requests to a defined customer friendly support resource in real-time
• Schedule and facilitate post-trial reviews to address outstanding questions as well as misconceptions, unspoken objections and confusion.

Given the breadth, depth and maturity of business applications, prospect confusion and frustration is an unavoidable by-product of the trial experience. CRM and ERP providers do not allow their own pre-sales engineers to deliver prospect/customer demonstrations until they have completed a rigorous and exhaustive training and testing program that often lasts months. Expecting unsophisticated prospects (by comparison) to intuitively replicate this experience on their own is unrealistic. Software publishers and partners will need to support their trial experience with structure and prescriptive guidance, or risk the anticipated returns from these significant and strategic capital investments.

Fortunately, many do this against a backdrop of economies still needing to invest in many forms of basic infrastructure to take their place on the world economic stage. So demand for business solutions is strong for them, even now. Some are experiencing 30%+ growth in revenue, year-over-year. Which, of course, is good news.

My assumption in heading to the continent was that the Cloud phenomenon would not really have taken hold there, at least yet. That Partners there would have the luxury of some time to restructure their business model.

I was wrong.

It turns out that there is strong and growing demand for Cloud-based solutions, even in these emerging markets. The reasons for this demand are the same as elsewhere – preservation of capital, lower costs, less perceived risk.

The way in which this demand gets served is somewhat different – instead of software publishers investing directly in hosting capacity and demand generation, telco’s seem to be stepping up to the plate and leveraging their existing infrastructure to field Cloud offerings. In some cases, the very Partners who provide the business applications end up disintermediated by their “customer”. As elsewhere, the only thing they can really lay claim to that will have a long term market value is specific IP that the bigger players cannot readily develop, or maintain. They clearly understand this, candidly in a way that many Partners in “mature” economies do not seem to, in my experience.

To be sure, Cloud offerings do not meet every need, and traditional offerings will continue to be sold around the globe. But we all know that demand is fundamentally shifting.

And if Africa is any indication, emerging economies could well be poised to “leapfrog” more mature ones by adopting Cloud solutions early. Coupled with a far lower cost of labour, and a bent towards innovation, this propensity to be early adopters could well spread the Cloud phenomenon at a far faster rate than many today expect. The real gains from this could fall to younger, hungrier, and ambitious entrepreneurs located in far flung corners of the globe.

So if you have yet to truly consider your Cloud strategy, and clearly define how you will transition your practice today to meet this spreading demand, my New Year’s message is simple.

Do it now. You probably have less time than you think.

Get real. Get honest.

Is being a leader the same as being a manager? NO! It is NOT the same! So why do we use the terms so loosely and interchangeably? Believe me there is a HUGE difference! I have seen very effective managers with profitable businesses, who are terrible leaders. The majority of their employees are exhausted and highly stressed with fear in their eyes..…but revenues are up! I have also worked with amazing, inspirational and creative leaders who oversee a loyal and hardworking team, yet lack critical management skills. Employees in their organizations are passionate and full of energy (with their dog snuggled under their desk) but their customers receive late or inaccurate invoices and no one seems to understand the terms of the office lease. Every organization needs strong management AND leadership. BOTH are critical in order to sustain a long term competitive business. The key to organizational balance is being honest in determining where your strengths (and weaknesses) lie. If, as a business owner, you believe yourself to be a strong leader but lack operational or managerial focus, hire an experienced CFO. If you are a highly effective and productive manager but struggle with vision and inspiration, find a partner or senior executive with charisma, passion and creativity; someone who will focus on what business you will be in 5 years from while you are stressed about achieving this quarter’s strategic operating objectives.

Management vs Leadership

The majority of my clients consider themselves strong leaders, but what is a “leader,” really? A leader inspires and motivates his/her team to achieve a common goal (key emphasis on the common), meaning they can relate to it and they believe in it. (It is unlikely they are motivated by your near-term goal of early retirement in a tropical paradise). Leaders have a clear vision of the future, then guide and nurture their team to create it. Teams (and individuals) follow leaders because they WANT or CHOOSE to, not because of reporting structures, obligation, authority or position power. Leaders influence their team members by earning their respect and admiration, which results in team members working harder because they believe in, trust and “buy in” to the leaders compelling vision and passion.

Managers on the other hand control, plan, organize and implement. They often rely on their position of power and authority to drive strict adherence to what they believe is the “right way” to do things. Reluctantly, their teams comply and follow, but without a sense of loyalty or passion. Managers focus on the short term; achieving goals, increasing effectiveness and driving efficiency and productivity at the expense of creativity. The worst type of manager, when his/her followers are too exhausted (burned out) or resistant to work harder, resorts to using fear as their primary method of motivation, without even realizing the high price they pay.  Loyalty is often measured in terms of how employees spend their discretionary time……..ask yourself (honestly) if your teams work late into the evenings because they WANT to or because they feel they HAVE to? I guarantee the quality of work will vary significantly based on whether they view you as a leader or a manager.

So which are YOU?

The following is a quick assessment to help you determine if you lean towards leader or manager. Select EITHER the sentence on the left OR the right, whichever better describes how you honestly see yourself today, not how you would like to be (now or in the future)!

If your total on the left is higher than on the right, you are predominantly a MANAGER and would benefit from developing more leadership skills and capabilities. If your total on the right is higher than the left you are predominantly a LEADER, and may benefit from focusing on developing your operational capabilities, or from hiring a resource to cover your blind spots. If your two scores are very close, you are likely a well-balanced leader with strong management skills.

Stephen Covey claimed, “Management is efficiency in climbing the ladder of success; leadership determines whether the ladder is leaning against the right wall.” Peter Drucker eloquently states “Management is doing things right; leadership is doing the right things.”

Go forth and lead!

With the cloud of the tip of everyone’s tongue, I thought this might be a great opportunity to reflect on where we have been and where we are headed. Those folks who have heard us talk about cloud will recognize the following slide.

This slide was part of numerous presentations we made throughout the past 18 months or more. We used this slide to introduce the concept of “Orderly Unwinding”

We told partners they should be proactively building action plans that contemplate the inevitable, though not necessarily immediate changes in customer demand, desired solutions and buying behavior caused by the cloud.

We explained that while there is debate and conflicting opinions with regard to the adoption rate and ultimate impact of Cloud computing, few argue that an increasing proportion of IT services will be delivered via the Cloud moving forward.

With changing customer buying behavior and changing expectations, Partners must start the process of consciously unwinding their current solution sets and business models to prepare themselves for a reconfigured demand model in the future.

Here are our predictions (made 18 or more months ago) based on the information we were able to put together at that time:

• In 2011

Overall, Partners have a GREEN LIGHT. We do not expect a material change in how partners react to customer demands.  Most customers today are only beginning to understand the benefits of the Cloud.  However, if Partners resist the market shifts caused by Cloud computing they will significantly increase their risk as the window closes on traditional on-premise solution sets.

• In 2012

Partners will still have a GREEN LIGHT.  We will see Cloud based business application demand increase. No longer primarily just CRM, but the increased viability of numerous ERP Cloud applications will place more pressure on those partners that have yet to fully embrace the Cloud and therefore fall behind schedule in the process of changing their businesses.  If they were in denial in 2011, they will suffer “fear of worsening” in 2012.

• In 2013

The light changes and turns AMBER. By mid to late 2013, we expect that 50% of customers across all application areas will be seeking Cloud solutions.  Partners that have done nothing to migrate their business will move into “catatonic shock” as their funnel and pipeline drops by half.

• In 2014

The light turns RED. 2014 will be the tipping point for Cloud solutions, with the majority of buyers looking solely for Cloud solutions.  All partners that did make the commitment to embrace change in the previous three years will be “angry and depressed” as they see their livelihood’s slipping away.

In 2015, the light STAYS RED
2015, is now a Cloud world with less than 25% of customers looking for on premise solutions and local infrastructure support.  Partners that failed to act, will be facing “little to no hope” of success if they have done nothing up until this point.

For those folks who are more visual, our predictions look like this…

The color of the calendar years indicates when it is excepted that demand for cloud solutions should near 50% of total demand, meaning that 50% of customers will be demanding cloud only options from the eco system (late 2013 – 2014).  With all the work a partner must do to prepare themselves for this change, it leaves little time for inaction.    What will you be working on in 2012?

For most partners, however, the idea of creating your own intellectual property and taking it to market is akin to asking an airline pilot to create his or her own aircraft; seemingly impossible.  But having worked with 1,000’s of partners over the years and now dozens more who are making this transition, the mechanics of developing, launching and reselling your own IP is not as complex as you may think.  In this first of a 3 part series we will look at a few steps to getting started:

1. Defining Intellectual Property (IP) – Anything you can bundle into a resalable “product” that augments the base application (Microsoft Dynamics, CRM, etc.).  Think software, services, templates, tools, specialized hardware or any combination.
2. What do you have that’s unique? – Take an inventory of your assets that often stay hidden in most partners’ businesses.  Consider:
   1. If you’ve been customizing code for clients, review your library of code units to determine if there are:
      1. i.      Individual code units that could stand on their own to be resold
      2. ii.      Any themes to the source code’s functionality that could be used to direct the creation of a more complete product
   2. Review your consultant’s and programmer’s domain expertise and find out if there any consistent service themes that could be “packaged” for resale.  For instance, if you are a CRM partner, you may find that one consultant is very good at sales process improvement.  Or a programmer has lots of experience with converting data from certain legacy systems.
   3. Look at your client base to see if there is a vertical market or micro-vertical that a few of them fall into.  If so, focus in on functionality that these customers always ask for that is missing from the base product that no other ISV provides.  Can you include some services with this additional functionality?
   4. Talk to your best clients to see if there is a portion of your implementation project that stands out as consistently outstanding that is unique enough to bundle and resell. Some examples could include a portion of your implementation methodology, the way you helped the client adapt to change, a particular training technique, or systems integration services.
3. Is there a viable market for your product? – This is a bit tougher to identify, but a crucial piece to the puzzle.  Once you’ve identified the “product” above consider conducting a little market research.
   1. Poll all your clients that could be interested and find out if they have a need for your product if it were to come to market.  While you’re at it, ask them how much they would pay for it on a subscription basis.
   2. Using your marketing database, call a percentage of contacts within the target market and ask similar questions.
   3. Talk to industry influencers (i.e., CPA’s, engineers, publications, hardware vendors, etc.) that understand the market to obtain validation of your ideas.

If you take inventory of your current source code work, domain expertise and market feedback and you find that you have some potential intellectual property to pursue, then you are ready for part 2 of this series, so stay tuned.

In the meantime, if you have any questions about these “how to” steps, feel free to respond to this post or send me an email at ross@salesworks.com.

There is a reason that the PMBOK guide (A guide to the Project Management Body of Knowledge, a well known resource) dedicates its entire chapter ten to communication. Communication is paramount to successful project management and is said to be 90% of a project manager’s job.  Too often we minimize the time in communicating key information clearly to project stakeholders on both client and service side because we are concerned about spending too much time and budget on something that perhaps is perceived to have low value. While there is no question that budgets can quickly be burned up with unnecessary detail, I have found it is also true that taking the time to follow some important steps during a project will help to make it a successful one.

• Listen. We all benefit from enhancing our own ability to listen to what someone is saying and understand what they actually mean by their words and where they are coming from. It helps us to plan, react and communicate accordingly. Listening, after all is the most important part of communicating.
• Identify what disciplines, departments and expertise will be needed for a project as well as any external information or services that will need to be included.
• Disseminate and make available, key information, specific tasks and timelines that each project stakeholder will need for their part in a project. Make sure you get your questions answered and that you answer as many questions as needed at project start. People generally don’t like to admit that they don’t understand something, so find a positive way to confirm that they have what they need. This may come in the form of a project plan or charter.
• Make sure that you have your information distribution planned and executed so that there is a centralized area where stakeholders can access the resources they require.

We seem to be equipped to communicate our initiatives plans and goals better today than ever with scalable project management software solutions available at our fingertips through the cloud. There is no question that these tools when utilized properly can equip us with greater visibility and intelligence while empowering us to be more efficient, productive and profitable.  It’s all about communication after all.

Everyone else is now madly searching for “Cloud Power”. Trouble is, no one’s exactly sure what it looks like. What is the exact nature of Cloud demand? What will it take to meet it? And make a viable business out of it? What does the customer really want?

The answer, I believe, is that today’s customer wants to consume technology NOT as a service, but as a utility.

For the better part of 3 decades now, as businesses have grown totally dependent on technology, they have also grown incredibly frustrated with it. It has consumed an ever increasing portion of the corporate budget, basically in the vain search for a lasting competitive advantage. But to the degree everyone has the same or similar technology, no one has an advantage. And of course, the technology industry itself exists to make sure this is the case. At that, it’s done exceedingly well.

Not so much the customers, though. They feel held to ransom by technology, many times. They can’t operate without it, or they lose competitive ground, and they feel forced to pay through the nose, to be experimented on and receive solutions that are both expensive and often don’t really hit the mark in terms of what the business needs. And really, they’re done with that. It’s as though the customer community has decided en masse that they’re mad as hell and just not going to buy it anymore. Cloud computing, to them, represents a way to consume the technology they really need, at a lower cost and with less risk. That promise has truly captured their attention, even though very few providers have been able to deliver it. Yet.

In short, customers want to consume technology as a utility. They want to just turn it on when it’s needed, and off when it’s not. They want to pay only for what they use. Of course, they want it to be appropriate to their business. And most importantly, they want someone to just take care of the details of making all that happen, without charging large sums for “services”.

Their logic, after decades of feeling experimented on at great expense, only to receive solutions that only do a part of what is really needed, is very simple. If you really know what you’re doing, you ought to be able to bring a full solution to the table, in exchange for a monthly subscription price. My setup costs should be minimal, too. And don’t even talk to me about customization.

If you can’t do this, you don’t understand my business, even though you’ve implemented hundreds of solutions. So move on. Let me know when you’ve got something real for me, but otherwise don’t waste my time. Don’t tell me how “complicated” and “unique” my situation is, unless you’re talking about a real strategic differentiator for me, and recognize that there won’t be many of those. Just keep me current with my competitors technologically, at a lower cost and with less risk.

In other words, provide me with technology as a utility. Not as a service.

A tall order, to be sure, and one that requires an entirely different business model to deliver. But like it or not, that’s what the customer wants. The question is if you’ll be the one providing it.

As October approaches, those of us in the Value Added Reseller (VAR) ecosystem know the impacts of the MPN changes are coming into effect. The very economic model Partners have built their businesses on over the last 15-20 years will change dramatically. By now, all Partners should have factored the MPN changes to margins into their financial forecasts, sales forecasts and business planning, and considered what needs to be done in respect to cutting costs and sustaining their businesses.

Beyond the MPN changes, Partner businesses are facing a shift in customer needs, with an increased focus being placed on the Cloud.

With the announcement of Sage MAS90 in the Cloud, it is clear that Cloud based offerings are not only here to stay, they are increasing exponentially by the day. The Sage MAS90 Cloud announcement comes with a very aggressive pricing structure – $170 per user per month, all in. This puts increased pressure onto Microsoft partners, as they have to adapt to and compete with that price point.

When you combine the MPN changes with the shift towards Cloud based computing, the traditional Microsoft Partner is on a collision course with financial calamity.

As the tides shift, Partners need to pay special attention to all aspects of their business. In particular:

• How are you adding customers?
• What are the costs of adding customers?
• What is your current profitability?
• What are the margins you currently drive from your products, and how are they changing?
• What are your customers saying about the Cloud?
• What is your Cloud strategy?

By now, every Partner should have explored their Cloud strategy and begun developing it. Partner marketing should be Cloud focused, with a particular emphasis on developing your Cloud offerings on the web. Cloud based customers are web-centric buyers, and, without a web presence in the Cloud, Partners will be unable to capitalize on the new emerging opportunities. Partners with no web-based Cloud presence won’t even be aware of the deals they are losing, because the prospects won’t be talking to them at all.

When we look at the release of Sage MAS90 in the Cloud, alongside the plethora of already established Cloud players like NetSuite, Salesforce, Workaday and more, it’s clear to see that a Partner who fails to position themselves in the Cloud will also fail to succeed as the tides change. Most Partners haven’t even really contemplated the effects of the impending shifts, but now is the time to really stop and think about your business, and what you want to do.

As we build out to year end, and start our FY12 planning process, we need to put our lens of examination on 2 factors:

• What do the underlying changes to the economic model in the MPN mean to you, and;
• What does the underlying economic shift in cash flow mean to you in relation to the Cloud?

Both of those factors put Partner businesses at risk if Partner’s don’t know the answer and haven’t planned for the effects.

As the economic tidal wave is bearing down on the Partner ecosystem, thought has to go into what is the next move of the Partner.

Questions to ask:

• Should you join forces with another Partner?
• Should you acquire another company?
• Should you sell your company?
• Should you ride out the storm?
• Should you make deeper investments into your Cloud offerings?
• Should you write your own IP?

These questions need to be addressed, before your business gets pulled out to sea by the economic tidal wave, never to be seen again.

Over the years, things have shifted dramatically. With changes in technology, the ability to work remotely or abroad, and the vast expanse of possible careers ever growing, traditional ways of being employed are a thing of the past. No one expects you to commit a 20 year life sentence to the same monotonous job anymore; they want to keep their teams fresh and full of new ideas.

They want you to continue to grow and develop yourself, so they may reap the benefits, then send you on your merry way.

You can’t just be skilled at your task. Employers want you to be an expert at it, and then some. Gone are the days of a single, focused career. You must be multi-functional, you must keep up with the marketplace, and you must fit into the corporate culture. The business world shifts at lightning speed, and if you have any desire to keep up, you best keep learning.

With the sheer amount of information available, the need to continue learning has never been more important.

We’ve recently begun hiring, both for ourselves and on behalf of some of our clients. As someone who did a brief stint as a recruiter at an agency, it’s interesting to see how much things have already changed. Even amongst all this change the mantra “hire for fit, train for skill” has always rung loudly in my ears when thinking about making a hiring decision, and I think it is a good place to start.

Sometimes, people have all the right skills on paper, but when considered in light of your company’s vision, your corporate culture and the attitude you want to demonstrate to your client base, you just can’t justify proceeding with the decision to hire. Other times, the person’s skills are only somewhat aligned with the job role you’re trying to fill, but they just feel like the right candidate. If you’re really lucky, the person will have exactly the skills and personality you want; but that can be hard to find.

The bottom line is this: your company needs the kind of energy and fresh ideas that will result in the highest success rate.

Sometimes, the perfect candidate isn’t the person who is most qualified from a skills position. Sometimes, the perfect candidate is simply the person who will work effectively in your unique business.

The world gets increasingly complex, and with advances in Cloud computing, social media and search marketing, it is important for your company to really understand what they are looking for, and why.

Is this year going to be different? What does the “crystal ball” say about the coming fall selling season?

Consider that the economy is still on very shaky ground, so why would any company part with cash right now unless they had no other choice. Most companies will likely still delay / postpone any capital expenditure if they can do so.

And with all the hype about “the cloud” coming, have we managed to confuse and paralyze potential clients into waiting to see what happens with this whole cloud thing instead of buying the old traditional stuff. After all, everyone knows you never buy version 1.0 of anything, right? So, why take a chance with CLOUD version 1.0? Many will say that cloud is NOT even up to version 1.0 yet.

Also consider that unless a company is incredibly basic in their needs requirements, many are having great difficulty in finding a complete solution to run their business in the cloud, thus making it difficult if not impossible for a company who wants to “buy cloud” to purchase anything right now. Although, I will agree that this is definitely more the case in ERP then it is in CRM. And btw, this is changing quickly.

So, as an industry, we have positioned ourselves so that the latest, greatest offering we have is very impractical for a typical customer to buy right now. In addition, we have told our customers that the “on premise” stuff is old technology, and here is the best part… we told our customers that this old “on premise” stuff is even more expensive then cloud technology. PERFECT MARKETING STRATEGY to help increase sales in a down economy, right?

My question to you is how deep did you dig yourself into this hole? I guess the more important question is how do you get out?

Here are some options:

Option #1:

• Ignore the cloud completely. Put your head in the sand and claim it to be a fad that will never catch on in the real world. Best of luck with this strategy, I think you are fighting a bit of an uphill battle.

Option #2:

• Go all in on the cloud. Stop everything you are doing with on premise work, abandon all your existing on premise customers and drink the cool aid from the fountain of “cloud”. Paint clouds on your car, house and mange to include the word cloud in every 4^th sentence out of your mouth. I hope you have a lot of capital; you will need every penny if this is your strategy. You will likely find you need to hire a bunch of new employees as well.

Option #3:

• Embrace the cloud, but be cautious and don’t burn bridges. Be sure you add verbage that helps to position you as cloud experts on your website.  Visitors to your website MUST be able to very quickly recognize that you offer both on premise and cloud alternatives. Be prepared to debate the pros and cons around cloud with any potential new customer.

Be prepared to sell either cloud or on premise and work towards building a stronger cloud-based offering as quickly as practical. The biggest question you need to consider is “What value does your company add to the equation in a cloud-based offering? Why can my company NOT be simply taken out of this equation as customers drive to save money and simplify complexities? These questions should be right at the top of your thinking of as part of your 12 to 24 month business strategy,

A smart short-term strategy might include an offer to help a company determine which is right for them, cloud or on premise and why. This could be a paid engagement or you can provide it at no cost, your choice. But, you should recognize that for sure, just about any company you chat with today is going ask about cloud, so be prepared.

People that know me know that I always like playing offense, not defense. I find it’s always more difficult to win when you are playing defense. Therefore take the cloud issue head on instead of defending against it.

If you approach the potential customer with a more diagnostic approach like we have been preaching for years now, you will likely find that although the cloud may sound real appealing, the customer has business needs that cannot yet be met through any cloud-based offering from any vendor at this time. Your job is to uncover those needs. What are the key business processes and how will they be impacted by the new cloud-based software. How does this impact affect the company’s business strategy?

While small, simplistic companies can find cloud-based alternatives, more sophisticated companies likely cannot YET.

The exact same approach we have strongly encouraged for many years, still works today. Know what your customer needs, what makes them tick, determine if business case can be made, and make sure you are working with the right people at the potential customer site.

Although I am very quick to admit that they game is changing, it has not changed yet. During this transition period, you might find it advantageous to offer a customer financing or even better a software leasing program to neutralize the whole out-of-pocket, up-front cash concerns they may have.

Hope this helps you with a short term strategy during this transition period.