Chasing Shiny Objects

There’s a strategy most follow when considering what to invest in for their business, and at no point is the question, “What looks the coolest?” asked in the course of that decision-making process.

By Diana L. Mirakaj

When car shopping, it’s always fun to look at the available options for the vehicle you want: sports package, panoramic sunroof, heated steering wheel, etc. While I may not spend much time asking questions focused on the engine, transmission, or wheels, I know that without them, the car is worthless since those are essential to its operation.

When it comes to building your business, it may not seem sexy to focus on the basics, but it’s necessary to achieve growth.

Over the years, The 2112 Group has noted a distinct performance difference between solution providers with solid business acumen and those without it. Channel partners with strong business fundamentals often achieve greater levels of growth and profitability. Again, focusing on the foundational elements of your business may not be the most alluring aspect of your journey, but the decision to invest in management functions, such as vendor relations, training, and human resources, is far more likely to reap long-term benefits than attending a scintillating event or relying on marketing gimmicks.

Rolling the dice isn’t a strategy (at least not an intelligent one), and rarely does growth come organically or without effort. While many solution providers are making plans and investments to turn their growth expectations into reality, a large percentage of the investments that still need to be made are around expanding operational capacities to meet market demands and attainment of goals.

2016 Midyear Channel Performance ReportOur 2016 Channel Forecast Report found that more than one-half of solution providers plan to grow their businesses through the expansion of sales and marketing of existing products and services to existing customers. This can be viewed as a positive change, as solution providers have traditionally been more focused on technology skills, preferring to invest in technicians and engineers rather than sales and marketing personnel.

The strategy of selling to existing customers is seen vividly in the investments solution providers made in 2015 that are paying off halfway through 2016. Those plans were recently validated in the 2016 Midyear Channel Performance Report, which revealed that expanding sales to existing customers has been the most lucrative investment for partners thus far this year.

The logic behind targeting base customers is somewhat sound, as this tactic requires less sales acumen and shortens sales cycles because the customer is already familiar with the solution provider. But therein lies a dilemma in the form of a talent shortage. Partners continue to be challenged in recruiting and retaining both salespeople and technical professionals. While investment in sales is admirable, it also proves problematic. Solution providers report that sales representatives are the most difficult to hire and retain.

It’s the worst-kept secret that the average solution provider prides itself on technical acumen, not salesmanship. While most solution providers emphasize the technology-based value they deliver to their customers, they don’t invest enough in business management and development. That’s a problem, and there’s no question that more needs to be done to improve those capabilities. But before emphasizing the need to innovate new business models and go-to-market strategies – the shiny objects with sex appeal– more needs to be done to lay a stronger foundation of management oversight, governance, and investment-strategy development.

Let’s face it: Everyone wants the fancy car with the bells and whistles, but you have to be sure you can drive it before grabbing the keys.


Diana L. Mirakaj is president and chief operating officer of The 2112 Group. You can follow her on Twitter at @dlenam.